Under the impact of the new crown epidemic, what business will be the most difficult to do in 2020?

Hotel? FOOD? travel ? Film and television?

There is no difficulty, only more difficulty. Under the overturned nest, there are still intact eggs.

However, looking across various industry segments, due to the "consumption downgrade" caused by the epidemic, one of the businesses that has been hardest hit must be luxury goods.

Chanel has stopped production, Gucci has zero orders, LV has lost 200 billion... These bad news have been emerging one after another in the past two months. Some analysts predict that the size of the luxury goods market is expected to shrink by 15-35% in 2020. The annual loss is expected to be 600 to 700 billion yuan.

On April 6, Hurun Research Institute released the "Special Report on Changes in Wealth of Global Entrepreneurs Two Months After the Epidemic". The No. 1 person in Waterloo is also a big boss in luxury goods - the head of LV. Bernard Arnault has lost 200 billion yuan in the past two months, which is equivalent to a daily loss of more than 3 billion yuan, making him the richest man with the worst losses in the world.

However, we also discovered a surprising phenomenon. When these traditional industry giants were losing their jobs, there was a mysterious Internet tycoon who accurately followed the steps of epidemic prevention and control. Make money!

That’s right, he is Liu Qiangdong, the head of JD.com who “doesn’t know the beauty of his wife”, commonly known as Brother Dong.

How does Brother Dong make money?

First of all, what we want to talk about is the capital operation that the "strong generation" Internet BOSSs are best at. As early as 2017, JD.com invested in Farfetch, a famous British luxury e-commerce company, with a shareholding ratio of approximately is 16.7, and the investment principal is only US$397 million.

What kind of company is Farfetch?

According to the introduction on the website, Farfetch was founded in 2008 and is the world’s most watched and fastest-growing high-end fashion e-commerce website. The company uses a zero-inventory platform model to connect with more than 400 buyer stores in more than 40 countries around the world, covering more than 1,600 fashion brands.

At this point, many novices understand that its positioning is similar to that of YNAP and Secoo. Luxury products are actively "e-commerce" and one of the capitalized products seeking breakthroughs in consumption scenarios. However, its positioning is similar to that of YNAP and Secoo. The base is overseas (the United Kingdom), and it targets overseas shopping parties from all over the world.

However, although it is similar to Secoo, Farfetch's stock price performance is much better than Secoo - this is one of the reasons why Dongge can "lay down and make money in 2020".

According to data from the New York Stock Exchange, farfetch’s stock price has risen by more than 120 since this year, with a market value of US$7.5 billion. The latest stock price has reached US$22.22 per share.

How much money did Brother Dong make from this shareholding? It is difficult to calculate now, because the shareholder structure of farfetch has become more complicated since its listing. Considering that some financial investments have become direct cooperation, JD.com’s shareholding ratio should be diluted, but judging from the current situation, it is lower than the original of US$397 million, which still needs to be doubled several times. (Farfetch’s current price is close to its issue price, which is much higher than Dongge’s shareholding cost)

Of course, making money from investment is a matter of vision and luck. As one of China’s largest Internet e-commerce companies, being able to Good management of luxury goods is the true reflection of strength.

In this regard, Brother Dong obviously has a lot of experience. At least in the first half of 2020, JD.com’s luxury goods matrix is ??still quite impressive.

Based on the data of 618, on the JD platform that day, the transaction volume of more than 100 brands including Prada, Miu Miu, Salvatore Ferragamo, etc. increased more than 10 times year-on-year. The transaction amount of luxury goods within 10 minutes It even increased by over 500.

The results of the day were finalized. The transaction volume of luxury clothing accessories increased by 213% year-on-year, and the transaction volume of luxury shoes and boots increased by 172% year-on-year, becoming the fastest growing category on JD.com 618.

Luxury goods have become the strongest growth engine of JD.com 618, which was unexpected in the past.

Of course, the success of JD.com’s luxury goods layout is also related to JD.com’s investment in Farfetch.

In 2019, JD.com gave up its self-built platform route and merged Toplife into Farfetch China. As of now, the Farfetch platform covers more than 3,400 brands, of which more than 500 are partners.

In fact, this move by JD.com is very smart. It knows that it does not have accurate user operations and lacks the operational management level of Farfetch. It simply chooses to invest while talking about cooperation, so as to make Farfetch full of potential. The precious resource "interface" needs to come over, and through the Internet, the precise marketing capabilities of big data can realize the traffic realization of "1 1 is greater than 2".

It is worth mentioning that JD.com’s gameplay is also very healthy – after the acquisition, Farfetch will still be an independent brand facing consumers, rather than selling its products through JD.com. This seems to retain Farfetch's independence to a certain extent, but JD.com is not watching from afar in this cooperation - similarly, it will use JD.com's Heilong technology and big data resources to establish an automated marketing system in China; "JD.com Pay" and The microfinance service "Jingdong Baitiao" will become the preferred method on the Farfetch platform; in addition, its logistics also uses the "Jingzunda" recently launched by Jingdong. Under the background of strong cooperation, both companies are almost reaping the benefits.

Of course, Farfetch also likes to "exploit" each other with JD. According to the financial report, the company's full-year GMV increased by 5.2 to 2.13 billion US dollars year-on-year in 2019, exceeding the 2 billion US dollars mark, and its revenue increased year-on-year. It rose sharply by 6.9 to 1.02 billion US dollars.

Ignoring the aftermath of the epidemic, the two fronts are advancing vigorously. Dong Ge’s dream of luxury goods is fulfilled. Looking at LV, the founders of Burberry have to issue stop-loss orders even when their temples are turning gray. (Closing stores, discounting and clearing stocks), JD.com, which was precisely ambushing, was able to counter the trend, eat up their offline share, and at the same time increase its voice in cooperation online. At this moment, Dong Ge, who is proud of the success, smiles unexpectedly. I'm afraid it will be difficult.