He is also the general manager of the overseas platform. He looks at emerging markets like this
Mature market is a foregone conclusion, but the emerging market is developing very fast, but the pit is also a lot, how to stand out under the tide?
Recently, in the '2017 China (Chengdu) cross-border electricity export summit', Linio, Jumia, Daraz, general manager of China Duan Chengchen talk about their understanding of emerging markets.
Linio, Jumia, general manager of Daraz China Duan Chengchen
The following is Duan Chengchen readme:
There is a reason for the outbreak of new markets
Linio, Jumia, Daraz three platforms themselves belong to different regional markets (Linio for the Latin American market, Jumia for the African market, Daraz for the Pakistan market), the regional market, although the culture and language are different, but these emerging electricity market Also have some commonality.
First of all, these countries are emerging economies, the whole economic trend is in the uplink, whether it is the level of national economic development, or national income are walking up.
In these emerging market countries after the rise in GDP and national income, the local consumer demand for the material will continue to rise, and these emerging electricity market countries to the primary industry-based, the main consumption of natural resources, so the entire manufacturing Industry is relatively weak.
At the same time, these international retail is mainly based on the general trade, that is, the form of traditional trade. What is the general trade drawbacks? The most obvious is the process cost is relatively high, because through the Chinese traders import, and then in the target country through the distributor , Retailers distribution, level is very much, the cost of circulation is also very high, and ultimately to the consumer level is the price will be very high
In addition, the general trade circulation is also very low.Most of the general trade is through the form of shipping, from the procurement to the final hand to the consumer process is very long.For the replacement of the fast shopkeeper product, the consumer through the general The category of trade is not enough.
This is why electronic products in the emerging electricity market soon rise.On the one hand, cross-border electricity business can be in a very short period of time to show these goods, on the other hand, electricity sales price is lower than the general trade, and their own consumption of these countries The demand for products is very large, as long as the electricity business compared to the general trade, you can more quickly to consumers to show more products, electricity business will continue to flourish in the local market.
Opportunities many but the challenge is also a lot
Compared to the European and American markets, because of the particularity of the market mentioned above, the emerging market growth in the emerging market is shorter, but there are opportunities in emerging markets there are many challenges, leading to the growth of Europe and the United States and China did not develop the rapid development of electricity.
Electric business behind the ecological is very large.Why is the domestic Jingdong, Lynx are doing well, not only the development of domestic electricity business is good, there are behind the ecosystem, especially logistics.If there is no logistics company such as SF Development, electricity providers will not develop so fast.
Therefore, the Chinese seller to sell products to the world the biggest problem is the logistics of the country.For example, if you are in the Latin American countries you buy a product online business, when you click on the purchase, tell you to 30 days to be sent, I believe most Consumers will not continue to buy.
Especially Chinese consumers, has been Lynx, Jingdong spoiled, and sometimes not more than three days to consumers can not accept, not to mention more than 20 days.But this is in emerging markets to do cross-border electric business challenges In addition, the local customs clearance is also a major obstacle to the reasons for logistics aging, such as Latin America clearance is very slow.
So in so many emerging markets to run up, we will find their development speed is different, which has become a major influencing factors in logistics.
Such as Southeast Asia, think of these emerging economies, the development of electricity is the fastest, because the concentration of Southeast Asia is relatively high, although the island, but the population, and most of the population concentrated in the city.
While the second development is about to count Africa, especially in North Africa because North Africa's geographical environment is plain, population concentration is relatively high, most people concentrated in the city.
Relatively slow development is Latin America, because Latin America is mainly mountainous, the population living very scattered, whether it is electricity platform level, or behind the national level, to develop logistics need more infrastructure.
For emerging markets, these infrastructure construction needs the first funds, the second construction cycle is very long, so the logistics can not support the development of short-term business, so the electricity business is lagging behind.
In addition to logistics, the payment is also a major factor in the development of electricity providers.Why is the development of domestic electricity business on the one hand is the development of logistics enterprises to support the development of electricity, the second is the domestic electronic payment system is perfect, as most Chinese consumers may Almost do not need to use cash, and directly with Alipay, WeChat can be very convenient and fast to buy goods on the platform.
But for these emerging economies, most consumers may not have electronic means of payment, more accustomed to cash purchase.For cross-border, the current most of these emerging markets model or through direct mail, where the platform orders , This side of the direct delivery of the past, so the whole time is relatively slow.From the consumer's point of view, he first need to prepay the way in a few days or even tens of days after the receipt of goods, for most consumers Is unacceptable.
In addition, for the cross-border sellers, because the emerging markets are different from the mature market in Europe and America is the main reason is that most countries do not speak English, traditional foreign trade sellers, whether traffic or from the volume , Mainly to serve the European and American countries.For emerging markets, subject to language restrictions, many sellers have not done a lot.
Sellers need to sell the product to other non-English speaking countries or non-English platforms, which need to optimize the content, not only the content is correct, but also accurate, so that consumers can search at once, and you can know what this is If the seller on the platform to display the product translation is very accurate, will lead to a lot of consumers can not search, search, conversion rate is relatively low, so the whole sales will be very Big influence.
Self-built logistics breakthrough bottleneck is king?
So, which emerging markets will first 'run up'? From the degree of development, the relative is certainly better in English-speaking countries.
In addition, to do a platform, not only the platform infrastructure construction, but also around the electricity business platform around the ecological - logistics, payment and service, these links are able to get through.
Jumia's current play is also built on the basis of the above. Jumia in addition to building a platform, but also responsible for the entire logistics and distribution links in the well-known large and small domestic and foreign business platform, to have their own logistics and distribution in fact only two Home, in addition to Jumia is the domestic Jingdong. (Amazon has a distribution system but no end delivery)
Why is Jumia building this piece of logistics? In the understanding of many sellers, in fact, emerging markets only need to upload products, the price is low enough to attract consumers.However, this idea is dangerous. In fact, the more emerging Market, the more need to do a good job of consumer experience.Because the emerging market itself, the degree of development of the Internet is relatively backward, its face a small proportion of consumers.
The second Internet has a small base of online shopping crowd, so the target consumer base is very small.For a platform to develop, nothing more than to attract consumers to buy more, the platform in order to allow consumers to buy more Must do the entire purchase experience, the purchase experience on the one hand the platform presents more products, the price is good.On the other hand, how to ensure that consumers receive orders faster, logistics is a very critical link. Several links need to work together in order to make the whole platform to go farther.