netease challenges chinese e-commerce giants on new battleground: own label retail - home appliances manufacturers in china
Alibaba and JD.
Com is busy controlling each other and a new competitor has joined the competition in an attempt to gain a foothold in China's $860 market
Billion net purchase market: NetEase.
Things they do are a little different.
Technology company, April 2016-
China's fourth-richest tech billionaire, William Ding, owns--
Beginning sales of fashion clothing, accessories, furniture and household appliances, allegedly manufactured by original manufacturers supplying top international brands such as Gucci, Burberry and UGG.
But they sell on NetEase's own brand Yanxuan at a lower price. How much lower?
For example, on both JD, a pair of original UGG boots cost just over $200. com and Tmall --
On the same pair of Yanxuan produced by the "UGG manufacturer", the price is only $45.
The model is working. NetEase's e-
Business, including cross-border
Border arm Kaola's net income increased by 160% to $1. 8 billion .
Since Yan Xuan's portfolio currently covers 10,000 products, Ding plans to earn more than $3 billion in revenue from the site in 2018 as it tries to catch up with companies like Taobao and JD. com.
Forbes MORE: Alibaba lost to Tencent in China in trillions
$ Pay war?
Alibaba launched its own label retail site, Taobao Xinxuan, in 2017, while Jingdong is not willing to show weakness.
Com launched its refined brand in January.
Nor did they sell their products like big brand manufacturers, nor did they approach Yan Xuan in scale. IP Theft?
However, there are some folds in Yan Xuan's feathers.
A spokeswoman for Australia said: "Yan Xuan's promotion will mislead consumers into believing that they are buying authentic UGG products . "
According to Forbes.
"We want consumers to understand clearly that UGG has no partnership with Yanxuan.
The American Apparel and Footwear Association also expressed concern about "potential theft of intellectual property.
More on Forbes: people who are engaged in a US trade war with Chinese counterfeit products "claim that the product is made by the same manufacturer", which is a telling --
Steve Lamar, executive vice president of the organization, told Forbes that it could be a story sign for a bad actor.
"The manufacturer may have violated the agreement with the brand partner.
"Yan Xuan declined to comment in contact, but according to Pan Xiaoning, director of the intellectual property department of Yingke, a Chinese law firm, Yan Xuan's statement is even true, if there is no brand authorization, it will be in a gray area.
"Most brands will enter into binding terms with manufacturers to prohibit them from using these brands for third parties --
"In this case, NetEase's behavior is more likely to be an infringement," she told Forbes . ".
Chinese consumers don't seem to care too much.
There are hundreds of reviews on the page where Yan Xuan sells UGG
The boots are commendable. -
Despite some points, there is still a gap in the quality of UGG Products.
Zhang Lin, 43year-
Old housewives from Shanghai, attracted by the brand association, bought a pair of short boots for every family member.
"A typical pair of UGG boots don't have much design and Ikea has a sheepskin for only $30," she told Forbes . ".
"Yan Xuan helps us realize the cost of the product.
More on Forbes: China is facing a flood of counterfeiting and contraband. year-
Old technicians from an online game company in Beijing found that Yan Xuan's real comparable products are not authentic, but ordinary products.
Long transferred from Taobao to Yan Xuan to buy kitchenware and daily necessities, "the price is slightly higher and the quality is more stable", which is guaranteed by large brand manufacturers.
But will this own-brand market challenge e-commerce?
Taobao or Jingdong business model. com?
Jiao Dingkun, an analyst at iResearch, a Chinese consulting firm, is skeptical: "One obstacle to the business model is whether it can find high-quality factories in the supply chain.
In China, the number of such factories is limited, which will put pressure on the scale. up.