The global e-commerce sector continues to grow at a stunning rate as more and more people are now constantly connected to the Internet. The implementation of new technologies such as 4G and 5G connectivity is also expected to have a positive impact on the market growth, as they help provide an uninterrupted experience to the user. Furthermore, during the pandemic, the shift to online shopping has swiftly accelerated, with an estimated 85% of people worldwide now shopping online, according to data provided by Facebook. Capitalizing on the opportunity, Facebook announced the introduction of Facebook Shop last year, a new place to discover businesses and shop for products within the social media app. E-commerce is also driven due to the increasing importance of online marketing tools, such as Google ads and Facebook ads. Overall, according to Grand View Research, Inc., the global e-commerce market size was valued at USD 9.09 Trillion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 14.7% from 2020 to 2027. Scienjoy Holding Corporation (NASDAQ: SJ), JD.com, Inc. (NASDAQ: JD), Alibaba Group Holding Limited (NYSE: BABA), BigCommerce Holdings, Inc. (NASDAQ: BIGC), Pinduoduo Inc. (NASDAQ: PDD)
Geographically, the Asian-Pacific region dominated the market in recent years, and is expected to witness the fastest growth from 2020 to 2027. This is attributed to a growing preference among businesses to carry out operations through B2B e-commerce platforms. Furthermore, developing facilities and a surging the number of internet users are expected to fuel the regional market growth. “Additionally, the Chinese market is going through a consumer revolution, wherein international products are taking benefit of innovative marketing, research techniques, and advertising. Brand consciousness is getting more importance in attracting Chinese consumers. Luxury goods and service providers are witnessing significant growth in China,” Grand View Research explains.
Scienjoy Holding Corporation (NASDAQ: SJ) announced yesterday breaking news that, “it has signed a memorandum of understanding (MOU) with Beijing Douneng Maihuo Culture Media Co., Ltd. (“Douneng Maihuo”), a prominent multi-channel network (MCN) and health e-commerce provider on Douyin. Both sides have signed the MOU to establish an official partnership and explore cooperation details. This announcement marks a substantial step in Scienjoy’s expanded presence in livestreaming e-commerce.
Douneng Maihuo stands out as one of the few MCNs in China that comprehensively covers the categories of fitness, fashion, health and weight loss. It is dedicated to establishing a health industry base and incubating and training Key Opinion Leaders (KOLs) and livestreaming broadcasters. In addition, it provides a one-stop solution for Key Opinion Consumer (KOC) training, live broadcast services, supply chain management and self-media content production. At present, Douneng Maihuo has nearly a hundred KOLs and has achieved rapid growth in 2021 with over 40x year-over-year growth in the first quarter of 2021. Douneng Maihuo has become a leading e-commerce provider on Douyin, the Chinese version of TikTok owned by ByteDance. In 2019 it was named as a top MCN in Douyin’s health and fitness category and was chosen in campaigns to introduce and recommend products to Douyin users.
Douneng Maihuo’s operations include providing famous health food brands with integrated marketing solutions, training KOLs to become leading influencers in health and fitness, and aiming to operate China’s largest private domain traffic for the health industry by aggregating fans on its health KOLs matrix. Douneng Maihuo uses precision marketing to target Chinese consumers who are concerned about health and fitness with health food and nutritional supplements brands such as BE-KIND, My Protein and Nestle.
China’s e-commerce livestreaming industry has huge room for development and a high market growth rate. According to a report on the livestreaming industry published by iResearch Consulting Group, the gross market value (GMV) of e-commerce livestreaming in China was RMB451.29 billion in 2019, accounting for 4.5% of China’s overall online shopping market. With the increasing integration between content platforms and e-commerce sales, the penetration rate of e-commerce livestreaming is forecasted to increase to 20.3% by 2022. The GMV of e-commerce livestreaming is estimated to reach RMB2.85 trillion by 2022. Furthermore, according to a report on China’s health food market released by the consulting agency Intelligence Research Group, China’s health food market is expected to reach RMB400 billion in 2021. With the increasing health awareness among Chinese consumers and the trend of more and more young consumers paying attention to health, China’s health foods market has huge potentials.
This strategic alliance will give full play to Scienjoy and Douneng Maihuo’s own resources and technological advantages. With approximately 250 million registered users and 300,000 seasoned livestreaming broadcaster, Scienjoy’s competitive operating capabilities will help Douneng Maihuo grow and maintain high private domain traffic stickiness. With the benefits of Douneng Maihuo’s MCN operation experience, vertical market advantages and public domain traffic conversion capabilities, Scienjoy can further explore different user groups, meet the needs of different vertical markets, improve the closed loop of content e-commerce monetization and develop business segments with long-term profitability.
‘Content-driven e-commerce livestreaming is an important strategic step for us to build our full mobile livestreaming ecosystem. Finding partners with existing products, a large user base and operating income will help us expand our market coverage.’ said Victor He, Chairman and CEO of Scienjoy on the cooperation. ‘We will further consider strategic partnerships that are in line with our strategy, explore and incubate new projects with high value potentials, expand market share and seek high-potential business segments, aiming to increase our market competitiveness and achieve robust performance growth.’
Douneng Maihuo’s CEO Liang Cai commented, ‘Our strategic alliance with Scienjoy will help both parties play a greater value in the field of livestreaming collaboration. With Scienjoy’s experience in online livestreaming entertainment, we will fully integrate the upstream and downstream industry chains. We believe that this partnership will assist Douneng Maihuo in achieving our goal of becoming number one in the health category for e-commerce livestreaming.”
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JD.com, Inc. (NASDAQ: JD) through its subsidiaries, operates as an e-commerce company and retail infrastructure service provider in the People’s Republic of China. It operates in two segments, JD Retail and New Businesses. Last year, the company announced that it has entered into a definitive agreement under which Jingdong Express Group Corporation (“JD Logistics”), a subsidiary of the Company, will acquire a controlling interest in Kuayue-Express Group Co., LTD. (“Kuayue Express”), a renowned modern integrated express transportation enterprise specializing in “limited-time express service” in China, for a total consideration of RMB3 billion through a combination of acquiring existing shares and subscribing for newly issued shares of Kuayue Express, subject to customary closing conditions. The Company expects to close this transaction in the third quarter of 2020.
Alibaba Group Holding Limited (NYSE: BABA) through its subsidiaries, provides online and mobile commerce businesses in the People’s Republic of China and internationally. It operates through four segments: Core Commerce, Cloud Computing, Digital Media and Entertainment, and Innovation Initiatives and Others. Earlier this year the Company announced a new suite of solutions at the 2021 Tmall Global New Seller Virtual Summit to help global brands capture growing consumption opportunities in China. “Brands, particularly small- and medium-sized players that have been hard-hit by the COVID-19 pandemic, are trying their best to enter new markets and find fresh channels for growth. In China, e-commerce platforms such as Tmall Global have become consumers’ preferred avenues for purchasing overseas products. Tmall Global is committed to providing a suite of solutions to help new overseas sellers capture these opportunities and assisting brands to bring quality products into China market,” said Maggie Liu, General Manager of Tmall Global.
BigCommerce Holdings, Inc. (NASDAQ: BIGC) reported last week that it has entered into a groundbreaking partnership with WineDirect, the leader in direct-to-consumer (DTC) services for wineries around the world. Through this partnership, the 2,000+ wine brands in the WineDirect ecosystem will be able to build a world-class online presence powered by BigCommerce, creating the ability to extend their market reach, engage with and sell effectively to consumers online. “Together, BigCommerce and WineDirect provide the modern platform wineries need to take their e-commerce capabilities to the next level,” said Russell Klein, chief commercial officer for BigCommerce. “As consumer buying behavior continues to evolve, particularly in the aftermath of COVID-19, wineries have the opportunity to significantly enhance their online sales. Through this partnership, wineries will now have access to world-class digital storefronts, inclusive of the functionality, security and speed needed to jumpstart their digital transformations.”
Pinduoduo Inc. (NASDAQ: PDD) through its subsidiaries, operates an e-commerce platform in the People’s Republic of China. It operates Pinduoduo, a mobile platform that offers a range of products, including apparel, shoes, bags, mother and childcare products, food and beverage, fresh produce, electronic appliances, furniture and household goods, cosmetics and other personal care items, sports and fitness items, and auto accessories. The company was formerly known as Walnut Street Group Holding Limited and changed its name to Pinduoduo Inc. in July 2018. Pinduoduo Inc. was incorporated in 2015 and is headquartered in Shanghai, the People’s Republic of China.
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