How JD.com Has Changed Chinese Retail And Consumer Credit Trends

China has already started combining the power of e-commerce and electronic payment solutions with traditional brick and mortar store services, and where much of North America has just begun bringing in new financial technology, they’ve already gotten ahead of it. But also significant is that Amazon, the main retail disruptor and big data giant also has two Chinese companies to contend with in Alibaba and JD.com. The latter has been seen by some in a better light than Alibaba in terms of the kind of business ethics they promote, and in some cases also because they use robots, drones, and artificial intelligence in ways that not even Alibaba does.

If you were to visit a remote Chinese village far in the interior of the country away from Beijing or Shanghai, you might see people there carrying on with lifestyles they’ve adhered to for hundreds of years; but you may see something else. It’s not been uncommon to see delivery drones owned by JD come to these villages and bring customers their packages. But e-commerce delivery isn’t the only area they’ve become specialized in. If you’re looking to apply for a loan, looking into making a large purchase or signing up for a lease, JD has developed a social credit platform using AI to check your credit. This program uses certain big data analytics to take a look at consumer risks, and it may just be the solution to cutting out all the paperwork that was required in the past. JD has been built over the course of 20 years by entrepreneur Liu Quingdong, or Richard Liu as his English name.

Even Liu Quingdong probably had no idea just how far he was going to take JD when he first started out. He came from a family who owned a business, and he attended Renmin University where he studied both political science and computer science. He opened a restaurant, an endeavor he thought would be a successful business venture, but it turned out not to be the case. But several years later he found a business opportunity for selling magneto optical drives, and this time it turned out to be the right decision. This new business was where JD was born from.

Richard Liu would take his new company, known then as Jingdong from selling the optical drives to selling many other electronics and later basic household goods. Everything was going very well for the business until the SARS epidemic became widespread across China in 2003. As employees became ill and business slowed down, Liu had to close many of his physical stores. But this brought about a whole new way of running the business for Liu as he built an interactive website he began to use as the primary sales platform. As he saw sales grow and product demand increase, he decided to rebrand the company to his website name, JD.com.

Liu Quingdong continued building the company and started exploring drone use as early as 2008. He had always kept it privately owned until he was approached by Tencent Holdings who saw the potential of the company to beat Alibaba. In 2015, JD.com had its first IPO and became traded on the NASDAQ exchange, and one of its most recent reports showed its shares were up to 33 cents per share while overall revenue came in at 121 billion Yuan. JD is already a partner of Walmart for a few product offerings, and Liu would like to see more partnerships made with US companies and tapping into new customer bases. But with President Trump’s latest trade policies on China, Liu has said this will have to wait.