Author | Li Xiaotian
Source | Kasumiga-kosha
Express "dark horse" Jitu, recently has a new action.
Recently, there are screenshots showing that J&T Express completed the docking test with the Jingdong platform, and Jitu appeared in the sight of Jingdong merchants. The partner page of J&T's official website shows that in addition to Pinduoduo, which ranks first, more than 30 e-commerce platforms, including Kuaishou, Douyin, Dangdang, etc., have reached cooperation with J&T, plus this access to the Jingdong platform, J&T has covered all mainstream players of Chinese e-commerce.
From starting overseas to opening up all domestic e-commerce platforms, from unknown to shaking animal flow industry giants, what did Jitu, which galloped all the way and opened up its territory, do it right?
Taking advantage of e-commerce, the rabbit is crazy
On August 20, 2015, J&T Express was born in Jakarta, the capital of Indonesia, and its founder was Li Jie, the former CEO of OPPO Indonesia.
The reason for leaving the mobile phone industry to enter the logistics track stemmed from the local logistics pain point that Li Jie found when selling mobile phones in Indonesia: at that time, although there were many logistics companies in Indonesia, all logistics would be suspended for about 10 days during Ramadan, a Muslim festival that evolved into a shopping carnival, and those days coincided with OPPO's peak sales period, and the delivery efficiency was greatly reduced. "So we thought, why not start your own logistics company?"
The birth of Jitu happened to hit a critical period in the history of the rapid development of Indonesian e-commerce.
In 2009, Tokopedia, known as the "Indonesian version of Taobao", was officially launched, opening the era of e-commerce in Indonesia. With a population of more than 270 million, a young demographic, and high internet penetration, Indonesia's e-commerce market is booming. According to global market research firm Euromonitor International, Indonesia's e-commerce penetration rate was only 2.2% in 2016, and by 2021, this figure had grown to 28%.
In 2016, Alibaba took the lead in entering the Southeast Asian market and acquired Lazada, a leading e-commerce platform, whose e-commerce business covers Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. In August 2017, Alibaba exclusively invested US$1.1 billion in Tokopedia's Series F financing, followed by a US$1.1 billion Series G financing with Son's SoftBank Vision Fund in November 2018. Shopee, which has received multiple rounds of capital injection from Tencent, has also accelerated the pace of expansion in Indonesia; At the same time, local Indonesian players such as Bukulapak have also grown rapidly and have a place in the domestic e-commerce market.
Jitu has established a close relationship with these e-commerce platforms has risen rapidly. In just two years, the delivery volume of J&T in Indonesia has reached an average of more than 200,000 pieces per day, and an average of more than 250,000 pieces per day in peak season, ranking first in the daily order volume of the Indonesian express delivery industry, and continues to grow at a rate of 20% per month.
Polar Rabbit's ambitions go far beyond that. In the following years, J&T expanded its business in Southeast Asia, expanding its business to Vietnam, Malaysia, the Philippines, Thailand, Cambodia and Singapore. By January 2020, bright and conspicuous red express cars can be seen in major countries in Southeast Asia.
2020 was also a year of strong growth for the Southeast Asian e-commerce market. According to the Southeast Asia E-commerce Report 2020 jointly released by Google, Temasek Holdings and Bain & Company, the GMV of e-commerce in Southeast Asia soared from US$38 billion in 2019 to US$62 billion in 2020, achieving a rapid growth of 63%. With the help of the rise of Southeast Asian e-commerce, Jitu has become the largest express delivery company in Southeast Asia.
Elsa, who is studying in Malaysia, told Xiaguang that Jitu helped her relieve her homesickness while studying abroad. "Sometimes I miss the variety of snacks in China, such as mochi, dried apricots, spicy strips, mung bean cake, etc., which cannot be bought in Malaysia; Go to the Chinese Super League to buy, the price may be about two-thirds more expensive than in China, and there are still very few types. After comparing multiple express prices, Elsa chose to try the consolidation service launched by J&T in Malaysia.
"The cost performance is really super high, the first order of new customers has a discount, and the volume and weight calculation method of others is length * width * height / 6000, polar rabbit is length * width * height / 8000, so I also bought a few storage boxes such a relatively large thing." A total of four packages were placed, three arrived in 5 days, and one arrived in 7 days. Elsa told Xiaguang that J&T's prices and services in Southeast Asia gave her an experience close to online shopping in China.
In March 2020, Jitu returned to China and officially launched the Internet in China. At that time, there were already "four links and one reach" (Zhongtong, Yuantong, Shentong, Best Connect, Yunda), SF Express, Jingdong Logistics and other head express companies in China that controlled the market share, and Jitu stepped on the explosive growth of China's e-commerce sinking market, thus achieving a strong breakthrough.
The cooperation with the e-commerce platform Pinduoduo has greatly contributed to the rapid growth of J&T's business in China. According to the financial report released by Pinduoduo on March 17, 2021, in 2020, the total order volume of Pinduoduo platform was 38.3 billion, a year-on-year increase of 94% over 2019. A large number of buyers are located in third- and fourth-tier cities and below, and Jitu has completed the initial network coverage to absorb orders from Pinduoduo on a large scale, and in only ten months, it has achieved an average daily express order volume of 20 million. And to reach this magnitude, the mastery department has taken more than ten years.
In addition to Pinduoduo, Jitu's cooperation channels also involve traditional e-commerce, live streaming e-commerce, micro-commerce and other e-commerce types, including the two most popular short video platforms - Douyin and Kuaishou.
In 2021, J&T acquired Best Express at a price of 6.8 billion yuan, successfully cutting into Taojie e-commerce, breaking the pattern of four links and one connection that has lasted for more than ten years, forming three links, one connection and one rabbit. After the integration of the two networks, the daily single volume of Jitu is stable at more than 40 million, surpassing SF, Shentong, and Yunda, and directly catching up with Yuantong. In terms of single volume, Jitu successfully squeezed into the first echelon.
On March 1, 2023, J&T successfully won the JD.com platform and became JD.com's third-party logistics service provider, successfully covering all players in the domestic mainstream e-commerce industry. Successively connected to Taojie e-commerce and Jingdong e-commerce, Jitu is like a subversive and innovator in China's logistics ecological pattern, which forces Chinese express delivery companies to join a more open and fierce competition, express delivery no longer has to bind and attach to any e-commerce platform, but rely on real strength to compete for market share.
After stabilizing the domestic market, J&T set its sights on the global market, hoping to seize the boom of cross-border e-commerce and lay out global logistics links.
In January 2022, J&T officially entered the Middle East and launched express network operations in the United Arab Emirates and Saudi Arabia; In February, J&T entered the Latin American market, with its first stop in Mexico and Brazil in May; In June, J&T officially operated in Egypt and began to leverage the African market; In August, J&T launched "J&T Wangbao" in the cross-border e-commerce market in Europe and the United States, focusing on cross-border light and small delivery services.
So far, Jitu has its own terminals in 13 countries in Southeast Asia, the Middle East and Latin America, and has built overseas warehouses in 9 regions in Southeast Asia, Europe and the United States; In August 2022, J&T joined hands with Hainan Airlines Cargo, with the help of its belly capacity of more than 600 aircraft and more than 2,000 routes, it reached multiple destinations in Europe, North America, Australia and other destinations. J&T realizes the full-link closed-loop from the dispatch, trunk customs clearance to the terminal distribution network.
In overseas markets, J&T not only cooperates with cross-border e-commerce platforms such as AliExpress, Shein, Tiktok, and Shopee, but also became an Amazon back-end service carrier in March 2022, planning to open sites in the United Arab Emirates, Mexico, the United States, Canada, the United Kingdom, Germany, France, Italy, Spain and other sites.
On the one hand, J&T makes use of China's years of e-commerce express development experience and strategies to attack cities in emerging markets around the world; On the other hand, it also accompanies the globalization of China's cross-border e-commerce, helping Chinese manufacturing and Chinese brands to go to the global market without hindrance. The extremely rabbit that has been soaring all the way is gradually becoming an international express giant in the e-commerce era.
The sword points to the world, and the polar rabbit breaks through
Since its birth, Jitu has the background and genes of the barbaric growth of OPPO startups, and has repeatedly staged plots of rising against the trend and coming up later in the 13 countries covered, rewriting the logistics pattern at home and abroad with extreme speed and service.
When J&T started in Indonesia in 2015, the Indonesian logistics market was mainly occupied by JNE, a veteran player founded in 1990. JNE stipulates that the company does not process packages on Sundays and holidays, and many agents do not work on Saturdays, so unless the package is sent on Monday and Tuesday, it will not be received until the next week.
In order to solve the problem of Indonesian holiday express delay, Jitu has undergone earth-shaking changes in the Indonesian express delivery industry with a service model that is open 365 days a year, 7*24 hours express transportation, and customer service online all day.
"Indonesia spans three time zones and is made up of more than 17,000 islands. It is simply not a country, more like a self-contained world. In the book "Indonesia: The Lost Pearl of the Gods" by British journalist Elizabeth Pisani, there is a quote to describe the unparalleled geographical diversity and cultural heterogeneity of the world's largest archipelago nation.
Indonesian seascape. Source: Unsplash
And this uniqueness has added many obstacles to the development of Indonesia's express delivery industry. Usually, other couriers coming to the country will focus on the Greater Jakarta area or Java first; J&T, on the other hand, has set up branches throughout Indonesia from the beginning. This makes it the first courier company that can cover all areas in a year.
In 2017, Dion, an Indonesian consumer who uses J&T Express, was surprised to find that after J&T delivered his package to his city at 12:55, the package was immediately delivered to a distribution point within an hour, and then delivered to a distribution point near his home at 14:45, and 20 minutes later, the courier delivered the package to his home.
"This is completely different from JNE! JNE: If a package arrives in the afternoon or evening, they will not deliver it immediately but will first put the courier into storage, and then assign it to the courier the next day, and the actual receipt of the package may be a few days later. Dion said. The Drop Point, a common express delivery configuration in China, has become a unique advantage of Jitu in Indonesia.
Dion asked the person in charge of the J&R distribution point in his area, why can J&R be faster than JNE? The person in charge told him that Jitu stipulates that all packages arriving during business hours (8:00-17:00) must be transferred out on the same day, and even packages arriving at 16:00 will be transferred to the next distribution point; Packages that arrive outside business hours arrive at the courier by 8 a.m. the next day and are delivered immediately.
In addition to ultra-high-speed operations, through in-depth market behavior research and consumer demand analysis, J&T is the first in Indonesia to launch a free door-to-door pickup service with unlimited weight, quantity and distance, which allows consumers to send packages without leaving home. With the support of advanced IT systems, J&T has also become the first express delivery service company in Indonesia to provide real-time parcel tracking system through mobile application and website. With all these innovative features, J&T has successfully established long-term partnerships with Indonesian e-commerce giants such as Tokopedia, Shopee, and Bukalapak to solve the biggest delivery problems that e-commerce usually faces.
The ultimate service in exchange for the rapid development of Jitu. According to the "2022 China Express Overseas Market Development Insights" released by Analysys Research Institute, the average daily total volume of J&T in Southeast Asia has long been unique, as of the first half of 2022, among the market share of the top express delivery companies in Southeast Asia, J&T far exceeds the second place JNE with a market share of 23% and is far ahead.
The same story takes place in other countries covered by polar rabbits. In June 2022, J&T officially launched its network in Egypt, becoming the second place in the Egyptian express delivery industry in less than a year. J&T has established 1 sorting center and 10 distribution centers in Egypt, and the distribution network covers the whole country except the North Sinai Military Region. Each of the 10 distribution centers has a general manager from China who is responsible for day-to-day operations and reports to the general manager of J&T Egypt.
In the first three days of operation, J&T adopted the strategy of free delivery to attract users, and after running for more than half a year, it gradually raised the express delivery price; And with the 365-day all-year delivery service speed of China's express delivery industry as usual on weekends, the Egyptian market has rapidly expanded, and even opened same-day delivery services in Cairo and Giza adjacent to Cairo. According to local industry estimates, Egypt's Jitu has more than 1,000 express vehicles and more than 2,500 couriers, second only to Aramex, a local express in the Middle East that has been cultivating the Egyptian market for more than ten years.
"The entry of J&R into Egypt had a great impact on the original old giant Aramex, and their leadership may not have come to inspect the Egyptian market for three years, and after we started the network, they came to the Jitu distribution center in Alexandria City to take a look. They also developed some pricing strategies for J&T, and also changed the way they used to work on weekends. The person in charge of Jitu Egypt said to Xiaguang Society.
If the old express delivery company took advantage of the first-mover advantage in the first wave of economic globalization to occupy market share, then Jitu born in 2015 is an enterprise in the mobile Internet era in the true sense, with the spirit of open, innovative, fast and shared Internet, and its vitality efficiency and service awareness can better meet the needs of the current times.
Compared with the exploration of domestic express companies such as Tongda, SF and Cainiao in overseas business, Jitu born overseas naturally has international genes.
In 2017, ZTO began to deploy in Southeast Asia and has established 16 distribution centers in five Southeast Asian countries (Vietnam, Thailand, Laos, Myanmar and Cambodia). However, in Southeast Asia, it is mainly cross-border business, and its business layout is more concentrated in trunk line transportation, and the layout of end-of-line delivery services with heavy assets and refined operations needs to be improved, and the lack of local resources also makes it difficult to increase ZTO's express business volume, so the voice of local express business is not loud. In 2019, ZTO and Yiwei Holdings jointly established a joint venture company Speedafei, expanding its business to emerging markets such as Africa, the Middle East, and South Asia, but it is still in the stage of testing and exploring.
After Best Group sold its domestic express delivery business to Jitu, it also accelerated its investment and development in Southeast Asia. As of the third quarter of 2022, Best has 30 Southeast Asia express distribution centers and nearly 1,500 outlets, and has achieved 100% logistics network coverage in Thailand, Vietnam, Malaysia, Singapore and other countries, and 80% coverage in Cambodia. However, its "asset-light" business model and outsourcing and franchise operation mode make it difficult for Best to escape the dilemma of declining performance in Southeast Asia. According to Best disclosure, in the third quarter of 2022, its global parcel volume decreased by 27.1% year-on-year to 27.04 million pieces; Global services revenue decreased 29.1% year-on-year to RMB211.3 million, down from RMB298.3 million in the same period in 2021.
Although SF went abroad in 2010 and set up a network in Singapore and other Southeast Asian countries, international business has not been the core of its development for a long time. In 2019, SF's international business scale was only 2.839 billion yuan, accounting for only 2.5% of the total revenue. With the vigorous development of the Southeast Asian e-commerce market, SF has also accelerated the pace of going overseas. In September 2021, SF acquired Southeast Asian logistics giant Kerry Logistics and joined the Southeast Asia express melee ; In May 2022, SF Encrypted has its own full-freighter flights to Singapore, Malaysia, Thailand, Vietnam and other countries; In July, Ezhou Huahu Airport, built by SF Airlines with an investment of more than 20 billion yuan, was officially put into operation, making it the "fourth in the world and the first in Asia" professional cargo airport; In August, SF's "Wolf Warrior Plan" aimed at the reward and punishment system for Southeast Asian export business leaked, showing its ambition to win the Southeast Asian market.
Although SF is the only express delivery company in China with a self-built airport in operation and the largest number of aircraft, the number of its outlets at the ground end of overseas is still not comparable to that of Jitu. Although the addition of Kerry Logistics has supplemented the number of outlets, its resources are more concentrated in Thailand, and the advantages of other countries are not obvious.
The rookie backed by Alibaba also has global ambitions. In 2022, Cainiao will complete the international export cargo and mail throughput of 175,000 tons, the export declared value will exceed 48.011 billion yuan, and the average daily cross-border parcel volume will exceed 4 million, and the international freight network has begun to take shape. However, Cainiao's development mainly relies on the Alibaba platform, and has not set up its own sending and receiving network like independent third-party logistics such as Jitu.
Sinking down and grasping every link of express logistics in your own hands is the biggest advantage of Jitu compared with other competitors. Among the 15 member countries of the Regional Comprehensive Economic Partnership (RCEP), which came into effect in 2022, J&T has its own express terminal delivery network in 8 countries, including China. Compared with other domestic express delivery companies, J&T has the fastest expansion speed, the highest efficiency, the deepest localization in the world, and the most empowering Chinese cross-border enterprises.
Enterprise panning for gold, Jitu helps
As the pace of development of e-commerce in first- and second-tier cities in China slows down, more and more e-commerce platforms have begun to expand the development space of the sinking market.
China's sinking market covers nearly 300 prefecture-level cities, more than 40,000 townships and towns, and nearly 700,000 administrative villages in China. According to the "2023 China Consumer Market Potential Value Research Report" released by the Consumption Growth Research Institute, the total population of China's sinking market is about 1 billion, accounting for more than 71% of China's total population. Among them, the number of mobile Internet users is 670 million, accounting for 74.7% of the total number of mobile Internet users in China.
The huge population base and Internet penetration rate determine that the sinking market is a blue ocean of consumption that needs to be explored, and the enhancement of residents' willingness to consume makes the prospects of the sinking market broader. According to the "2021 "Sinking" Market Special Research Report - E-commerce" released by iResearch, nearly half of the sinking users shop online 1-3 times a week, and prefer popular and discounted products when shopping without purpose.
In the battle for the sinking market, Jitu that works closely with Pinduoduo undoubtedly has a natural advantage. It is precisely because of Pinduoduo's ultimate cost performance that Jitu can accurately target the urban and rural population below the third and fourth lines, lock in this part of the market through low prices, and form a regional scale advantage. Moreover, in order to make the brand deeply rooted in the hearts of the people, Jitu has brushed huge wall advertisements in Guangxi, Anhui, Fujian and other local townships, using clear and direct promotional slogans to narrow the distance between consumers and achieve the four words "deep in the local".
In 2020, J&T began to develop the "Jitu Special Product Line" to transport high-quality and low-cost agricultural and sideline products from rural areas to thousands of households in cities, helping farmers increase income and injecting strong impetus into rural revitalization.
According to the real-time monitoring data of the State Post Bureau, at 8:10 a.m. on December 1, 2022, a honey pomelo express shipped by Jitu Express from Pinghe County, Zhangzhou City, Fujian Province to Xiamen City, became the 100 billion express delivery in the country that year. Connected at both ends of the courier are the parents of Mr. Cai, a teacher who grows pomelos in his hometown, and the friends that Mr. Cai met when he was studying in Xiamen. Every pomelo harvest season, everyone will directly buy honey pomelos from Heiwa Prefecture through him.
"For individual farmers, we also benefit from it. If we sell to wholesalers, it may be less than a dollar per pound, but through direct sales, direct express delivery to consumers, one pound can be sold for 2 pieces 5, which greatly increases our income. Mr. Cai said.
As of December 2022, the Jitu specialty line has covered 147 districts and counties across the country, transporting 137 categories of agricultural products, including Shaanxi Yan'an apple, Jiangxi Gannan navel orange, Fujian Ping and honey pomelo. The in-depth development of Jitu has given fruit farmers in these areas the opportunity to directly connect with consumers, and have achieved a leapfrog and upgrade of production and marketing integration through "e-commerce + express".
In addition to going deep into the sinking market, Jitu that started overseas and has its own globalization genes has connected domestic and international express delivery networks in 13 countries in Southeast Asia, Latin America and the Middle East, thus effectively helping Chinese cross-border e-commerce enterprises go overseas.
Compared with China, overseas emerging markets are vast areas for China's e-commerce to explore new volumes. Taking Southeast Asia as an example, according to data from the International Monetary Fund, the scale of online shopping users in Southeast Asia will reach 350 million in 2021, accounting for 80% of the total number of Internet users and 58% of the total population, and the scale of online shopping users will still have an annual growth of 40-60 million people, but the online shopping penetration rate still has growth potential compared with mature markets.
Jitu undoubtedly has a huge advantage in opening up the last mile operation of various countries.
In Egypt, for example, many addresses are ambiguous, and inaccurate expressions such as "near a mosque" abound, adding a lot of difficulties to express delivery.
In response to this situation, for each delivery, J&T not only based on the physical address provided by the user, but also locates the latitude and longitude of the address provided by the customer through Google Maps; And set the order memory function inside the system, the package in the same area, the system will automatically match the "city-region-outlet" three-segment code according to the address of successful delivery, so as to improve the delivery accuracy and efficiency.
Joe, an employee of a Chinese company living in Cairo, told Xiaguang that she rarely shopped on Egyptian e-commerce platforms because there were few choices and delivery was slow; Recently, Egypt's Jitu and local e-commerce giant Noon reached a cooperation, and Joe found that her order placed at 2 p.m. the day before could be delivered the next day.
"The speed of Jitu is really amazing, and there are almost no couriers in Egypt that can compete with them in terms of service." Joe said to Kasumiga.
And the rabbit's fury is far from the end. In August 2022, Yang Jinghai, CEO of J&T International, said when releasing the new service "J&T Wangbao": "Relying on J&T's global logistics resources and the end-of-13 end-of-line delivery capabilities of J&R&T Express, J&T International has further realized J&T global interconnection in addition to opening up international logistics channels. In the future, J&T International will realize G2G (Global to Globa) with stable and competitive diversified logistics services, combined with digital construction. ”
While continuing to deeply rooted in the existing market, while betting in advance in emerging markets with potential, Jitu who wants to become the "Chinese version of UPS" is also on the way to continue the battle.