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Looking for new growth points overseas

Jingdong to launch flagship store on Google

Recently, Jingdong announced that it will push the US flagship online store on the Google platform to directly sell products to American consumers and create a larger market share in the United States.

Jingdong strategic director Bao Yan said that Google will handle payments and orders, while Jingdong is responsible for direct shipments to US customers. In June this year, Google’s 550 million US dollars in shares in Jingdong laid the foundation for Jingdong to explore the US market. Last year, Jingdong founder Liu Qiangdong repeatedly mentioned the need to open up overseas markets. Liu Qiangdong also made it clear that half of the profits in this decade will come from overseas markets.

On the other hand, domestic e-commerce competition is becoming increasingly fierce, and Pingduoduo, in less than three years, has surpassed JD in daily goods. Jingdong is currently facing a positive competition with Alibaba and Pingduoduo, and will focus on foreign countries to avoid the direct competition.

In foreign countries, Jingdong will have many advantages in logistics. Jingdong has already established a partnership with Wal-Mart to sell its products in the United States. JD.com also owns and operates many of its own warehouses and distribution services in the United States, and continues to expand. However, it is not easy for Jingdong  to do business overseas. First of all, from the perspective of the greater international environment, the current trade relationship between China and the United States is tense, which may cause a potential problem for JD's shipping by sea; meaning that it will increase the costs of freight and impose high taxes on imported goods. Second, for Google, cooperation with JD is a strategic defense against Amazon. It is still unclear how much traffic Google will provide to JD. Finally, as the head of the US retail industry, Amazon has an unshakeable status. Compared with JD.com, Amazon's local logistics and supply chain infrastructure has matured.


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