JD.com is acquiring Ceconomy - and from a European perspective, the deal raises far more questions than the headlines suggest. In this episode, Ingrid takes a deep dive with China expert Ed Sander. They discuss why JD is not treating Europe as a growth adventure, but as a strategic detour. They unpack why JD’s own platform experiments such as Joybuy and Ochama failed in Europe, why trust and localisation are decisive here - and why Ceconomy is less a retail asset for JD than a distribution shortcut. The episode also focuses on the growing negotiating power of Chinese players that bundle Western and Chinese brand volumes - with tangible consequences for prices, margins, and market structures. An episode about structural shifts in European commerce - and why this deal should be understood as a signal rather than a one-off.

They were saying, oh, we've opened up the whole market and we're selling to Poland and Austria and all of these different places in Europe.

I don't know if there are any orders coming in, but I seriously doubt it.

I think that was just window dressing.

So now with Joy Buy, they are relaunching the whole thing.

And what you definitely must have seen in the first couple of weeks is that it was quite dreadful.

Let's Talk Marketplace the Marketplace Podcast with Ingrid Lommer and Vana V. Dichtu hello and welcome back to let's Talk Marketplace.

It's great to have you back again.

I'm Ingrid, as always your host, and today I have a topic for you on one particular player that you might not have heard about until about last year when they were the first talks that they would take over the economy.

The mother company of Mediamarkt and Saturn.

Of course, I'm talking about JD.com one of the big Chinese commerce players, but not the loudest one.

By far not the loudest one.

And I've been looking into them over the last month because of their takeover of MediaMarkTagThorn.

And to be honest, I couldn't really make heads or tails of them.

You know, why are they buying Zeconomy?

What are they doing here?

Why are they building logistics centers?

What is their plan?

I have no idea.

But the point is, whenever I have no idea about a Chinese player, I know who to call.

And it's great to have you back, my close business friend and an absolute authority on China commerce.

And it's always good to have you on the show if I have questions on China Players.

So hi, thanks for having me back.

Great to have you again.

It's been a while since you've been on the podcast.

I think about half a year since.

So how have, how have you been doing?

What have you been doing in the last half year?

Yeah, I've been quite busy.

Last October we had our second tour with K5K and that was great fun again.

So we actually are, I'm preparing for a tour in April where we take the people that have been on the first tour to what we call the Episode two tour, where we're going to go much deeper into the.

The material but also visit completely different places that people rarely go to.

So that's one thing that I'm doing.

And then in October this year we will have another K5 tour and a tour that I'm doing with Virke from, from Norway.

So I'm also sort of preparing for that one that's going to be the standard episode one tour again.

And on top of that, of course I've been writing for techbuschina and I've been setting up my, my own new platform which is called the China Digital RET, which will basically continue what I'm doing for TechBoss China on that new platform.

But I will have the ability to publish much more and different formats of content, not just the very deep dive reports that I've been doing for Tech Boss.

So that's been keeping me busy lately.

Yeah, it sounds like it.

Definitely.

Lots of tours going on, lots of writing going on.

Really cool.

So of course when I wrote to you and said let's talk about jd, you didn't have the same problem that I have that you don't know what they are about.

So.

So why has JD sort of been missed by Europeans for so long?

I think the main reason why most people are not very familiar with JD is that they have not been very active internationally with their retail business.

I mean if you look at Alibaba, Alibaba actually started with a B2B business, Alibaba.com and then later about 10 years later they rolled out AliExpress.

So from that point of view, they've always been very active in our markets in different formats.

JD has never really been very strong in cross border retail and in international retail they've only been sort of getting more active in, in that space in the last couple of years.

So that's probably one of the reasons.

And of course you also have the matter that very few people actually look at what's happening inside China because they're mostly focused on their own markets and only when a Chinese competitor comes to their markets, they're paying attention.

Who does that guy know?

Yeah, in China, JD has been number two for a very long time.

They're currently number four.

But they were number two after Alibaba.

Okay, yeah.

So now they number four.

That might be one of the points that we were going to return to later, I have a feeling.

So why have they bought secondomy of all companies that are on the market in Europe at the moment?

What they do they want with them and how do they match with the JD DNA?

So why do they buy it?

I think basically the thing is that they want to expand internationally and if you look at what is being said in all of the press releases, that doesn't give you a lot of information about what they're planning to do with the company.

That's like the, the standard PR talk, right?

Like we're going to do great things for the customers, etc.

Etc.

But if you look at what, if you actually look at what Richard Liu, Liu Chandong, the founder of the company, has been saying in China, both to his own staff but also to the, the press in China, is that he has the opinion that the last five years were like throwaway years.

He's very frustrated.

He was also sort of in semi retirement, but he was very frustrated that nothing really happened in the past five years as far as innovation or new business initiatives is concerned.

So he stepped back in and he said we're going to do some, something like six or seven new things.

He didn't specify what these things were, but one thing that was clear is that he wanted to reignite what they were doing internationally, cross border and international markets.

Because a few years ago basically JD completely pulled back.

They closed down their cross border business in Indonesia, in Thailand they had a version of Joy Buy, which we'll also probably discuss today, that they also closed down, which at that time was like a B2B2B kind of platform.

So he wanted to reignite that.

And so the two things that he's doing is by one way opening a new version of Joy Buy.

But the second thing is what, what can you do if you don't have a local presence?

And JD is a very, is a company that is also very active in China in brick and mortar stores.

So they have a lot of experience in offline retail.

But of course, if you want to set up an offline retail business, I mean if you look around China, there's JD malls that we can talk about, but they have computer stores, they have mother and baby stores, they even have car maintenance garages because they supply all of the auto parts.

Okay, so you can even take your, your, your car to a JD garage.

So they have all of that kinds of stuff.

But, but they, they don't have feet on the ground in Europe.

So if they buy an existing business, they don't only get like the, the location, the, the real estate, the stores.

They have the customers that have already been shopping at those places, an existing business.

So they buy themselves into the channel.

Now what are they planning to do with that channel is a couple of things that like I said, you can see in what Richard Liu has been discussing with local media in China is he's been saying he wants to take 1,000 Chinese brands worldwide.

Now you can try doing that with a Joy Buy, but that's building an online platform from scratch.

It's much easier to get those thousand brands into an existing infrastructure which Media Mart Saturn is its economy.

So that's one thing.

And another interesting thing is I was having coffee with a couple of international initiative guys from Meituan, one of the competitors in China of Jing Tung of JD and I said well he probably wants this economy business to help these brands just go abroad, these Chinese brands, these thousand Chinese brands.

And then they said something that I had overlooked and that was yeah, but he's got his private label products as well.

JD is actually quite strong in private label brands in consumer electronics.

So they are taking both other brands but also their own brands into the international market.

And like I said, buying an existing infrastructure is, is a very good strategy to sort of hit the ground running.

That's interesting.

It's also interesting.

I'm just coming up with this idea because Media Mangsatun in the last years has been pushing its, its marketplace really strongly.

And they are on a good road to do that.

2027.

Sorry.

And now JD comes along which is a retailer if I understand correctly, who doesn't have any stakes in the marketplace business.

They want to control their own retail business and they are strong in private label.

So could that mean a big strategy switch for ITS economy as well?

Actually if you look at JD in China, they do have a marketplace.

They're a bit like Amazon and I think that probably their 1P business, their self operated business is bigger than their marketplace business.

But they also have a marketplace.

One difference is that they monitor it quite closely because one thing that people know about JD Jingdong in China is that's what people go for because they have trust in the platform.

They know that if they buy something there it will not be what they call in China Shanzhai, which is like counterfeits, fake goods and it's trustworthy and it's going to be delivered quickly.

So JD basically says to anything that goes on on the marketplace has to follow the same standards.

If you look at their international business that's completely self operated so far, which doesn't mean that they wouldn't open a marketplace maybe in the future or sort of leverage the economy marketplaces but for now also because they're really a company that wants to keep things under control and wants to keep that quality and the trust of the customers very high, they will with their own, for instance Joy Buy business will be focusing on self operated.

Okay, let's talk a bit about Joy by then.

And especially as you're saying that JD has this high look for quality and standards.

And now Joy Buy, as I have seen, it has been active in Europe for a longer time, but under the name of Ochama, I think.

And if you looked at that platform, it didn't really reek of, I don't know, high quality and good customer service.

It's an understatement, quite bluntly.

And of course, it went right over the heads of all European customers who looked at that thing and went like, yeah, not in this life.

And now it has been rebranded to Joy Buy.

So what's the difference?

What is Joy by in Europe at the moment?

Yeah.

They actually had to explain that it means amazing omnichannel.

And you mix that up and you get Ochama.

Oh, wow.

Okay.

I wouldn't have guessed that.

You didn't know that.

No, I didn't.

So they.

What they did is here in the Netherlands, because I was really excited.

It's like one of the first Internet companies that comes with a physical business to your market.

So I was pay paying close attention to it.

And they opened up these robot stores, which was basically like a robot arm that would get your order, basically a box with all of the stuff that you bought from a rack and put it on a conveyor belt and it will roll up to you, which is kind of cool for one time.

But then you actually realize, well, hold on, this is actually a pickup station.

And I have to do a lot more to get my goods than just simple simply having them home delivered.

So they very quickly, within a year, closed down all of these stores except for one.

And they changed to a model that was more like a pickup service, which resembles something that they have in China, which is called community group buying, where basically all of the orders get dumped at a pickup point to sort of save on the last mile delivery and then the customer has to go there and pick it up.

Now, I don't know who came to this idea, but I don't know what it's like in Germany.

But pickup is not very popular in the Netherlands.

It actually is in Germany.

Okay.

It's not at all here.

So it was completely the wrong market, unless you lived in a very dense, for instance, in Amsterdam and there was a high density of pickup points.

The thing was that in all of their communication, they were probably because of lack of experience, they were very much focusing on the Chinese Diaspora.

So also when they started recruiting pickup points, they had Chinese tea houses, Chinese restaurants, those kind of places, which was really strange that you needed to a, as a customer, go to a tea house or a Chinese restaurant to pick up your groceries.

So that also didn't work quite well.

Then they had this cooperation with Blocker in the Netherlands.

Blocker went belly up, went bankrupt, so that they lost all of that.

And around that time, a bit later, they rebranded to Joy Buy.

But the whole thing that.

What I've seen with Ochama is just a total lack of localization.

They started out with three Dutch managers, but for some reason, I don't know if they chose to do so themselves or they were asked to.

They all left after one year, so.

And then they started running the business from Beijing mostly, and it just didn't make any sense.

They basically were only selling to the Chinese diaspora, mostly.

And I was monitoring the views on their account on WeChat, the chat app that they used to communicate, and that was sort of flat, around a thousand views.

So they weren't really growing.

But at the same time they were saying, oh, we've opened up the whole market and we're selling to Poland and Austria and all of these different places in Europe.

I don't know if there are any orders coming in, but I seriously doubt it.

I think that was just window dressing.

So now with Joy Buy, they are relaunching the whole thing.

And.

And what you definitely must have seen in the first couple of weeks is that it was quite dreadful.

You might have seen that.

That back shot of the.

The candies, the.

The treats, like the candies, but the top was ripped off.

That was.

That was going around the Internet everywhere.

And that was sort of what it was like.

I mean, strange translations, things that didn't work.

Something that they call in in China, Chabudo, like it's good enough to launch.

Well, that might be good enough for the Chinese market, but here in.

In Europe you only have one chance to make a good impression.

So.

So that, that's, that's very different.

And the more complaints kept coming in, they were saying, yeah, but this is just a beta.

But I mean, you cannot get away with a beta here in Europe.

Not in Europe, no, no.

So they actually put the word beta in the logo.

So if you looked at the website, it probably still there.

It said Joy by beta.

Nobody cares if it's a beta or an alpha or whatever it is, of course.

So it was very much like the same mistakes that they've been making with Ochama just, just all over again.

Recently I've been paying a lot of attention of the, to the adverts that they have on YouTube and they were for the Dutch market because that's the adverts I get served.

And there was so many dreadful mistakes.

Like they were selling a product that is completely irrelevant to our market and they were using a Flemish voiceover, which is very strange for Dutch people if it's not, if it's not a website from Belgium.

There were AI voiceovers that just come completely got it wrong.

Like the, the word, the word for traffic jam in Dutch is file, but they pronounced that as file.

Okay.

And I said, well, you, you, you, you won't have any files anymore in the future with this product.

So, so it was very, very dodgy.

And I've actually had like a very close contact with their team in, in London telling them all of the things that went wrong.

And they said, well, this, our agency is making all of these mistakes.

We'll look into it because we need.

We don't want this.

And that's what they keep telling me as well.

We don't want this Chabudo.

This just stood enough.

No, we want to put down, launch a quality website.

So they are just as frustrated at the same time.

But it is very ironic that it's basically the same mistakes they've been making with Ochama again.

Yeah, I just looked it up.

It actually still says Joy by beta, which I find interesting.

I mean, that's, that's why I, I don't really get JB at the moment because from a European standpoint it looks so random in a way, so volatile.

Yeah, they're coming along and then it's charmer and then it's Joy by.

And it's still basically.

I mean, no one's going to use that one.

Then they, they buy media marked and no one really knows what they're going to do with it.

And so as I don't know, I'm sure there is a strategy, but I can't see it.

So what is happening behind the scenes?

I mean, are they looking for employees from Europe?

Are they building teams here?

Are they building bases here?

How are they addressing the European market?

Yeah, well, they've definitely scaled up from when they were doing Ochama.

I mean, Ojama basically was the Netherlands part of Germany.

I think the, the west part of Germany.

They were also delivering there Belgium and the area around Paris.

So that's, that's mostly where they had pick up points, but they were also doing their deliveries.

I Don't think that they were ever active in the uk but the UK has become like a very prominent target market for them and they have recruited, I think I just read somewhere that they now have more than a thousand employees in London or at least for Europe.

Something which they are also doing, which might also be related to the high number of employees is that they are doing like very fast delivery, same day delivery within half a day, I think.

So they are definitely building teams also on the logistics side.

And they've been getting people just like Temu has done, getting people from existing competitors, like whether it's Alibaba or whether it's Amazon, like different marketplaces.

They've recruited people, they've poached people to, to come and work for jd so that's definitely something that's been happening.

Okay, so what are the next steps going to be?

What do you think inside Europe?

Well, an interesting thing is that you just had, I think it was the Prime Minister of the UK that visited China and seemingly they are now officially launching Joy Bar which is like after doing it in beta for one year, they're gonna officially launch it.

So I think they're, they're gonna sort of step up and it might be more visible, I mean in.

If you, there have been pictures on the Internet of them actually driving around these like, these little cars, these little trikes like things that are branded Joy Express also or Joy Buy in, in the uk.

So I think they, they, they must definitely realize that they've, they've Dr. Ball with Ochama and even though they seem to be making the same mistakes, they don't really want to make it to become the same type, type of failure.

So on Joy Buy, I think that they are putting more resources into it if that will result in, in better communication strategies and better marketing content.

We'll have to see, so we'll have to see if that improves as far as economy is concerned.

There's still a couple of approvals that need to be given in Europe before they can actually start doing something there.

Right.

I think ever to understand JD in more detail, we might have to talk a bit more about JD Retail.

Do we?

Because there's so much more that they're doing in China with their offline retail chains, with their digitization of offline stores.

Maybe you can talk a bit more about how they are seeing offline retail and what that might foreshadow for what they are going to do in Europe as well.

Yeah.

So if you look at JD Retail that is making up about 90% of their total business.

They also have JD Logistics where they.

JD Logistics both handles the delivery part of JD Retail, but they're also offering services internationally.

Also with JD Logistics, for instance, close to where I live, they have a warehouse where they do the e commerce logistics for.

So that's a part where they do.

They have JD technology with AI cloud, Fintech.

But the most important business I think for this podcast is the JD retail business.

Now the JD retail business consists of on the one hand the JD.com website.

And that like with Alibaba is also a whole ecosystem of different sites, not that expanded as with Alibaba, but there's more than just JD shop in there.

So on top of that you have instant retail what they are doing.

So they have an instant retail business which currently is called Jingdong Biao Song, where they deliver from stores in your own area, normally in a radius of about three to five kilometers from where you live.

You place an order there, they go and pick it up and they go and deliver it to you.

So and they.

That's what.

That's how they basically also digitize retail in China.

They have a business called Jingxi.

Jingxi is like a clone of Pinduoduo.

Now Pinduoduo is a C2M customer to manufacture concept that is also behind Temu internationally.

Jinxi has never been really, really popular.

But what is very interesting is that JD has always, or always at least for the last 10 years, seen itself as an omnichannel business.

Now I've mentioned that they have the JD computer stores, the mom and Pop, mom and baby stores, the JD car maintenance stores.

They even have something called seven Fresh.

Seven Fresh is a supermarket that was a copy of Fresh Hippo that you might know from Alibaba, Alibaba supermarket chain.

Actually there's an interesting story because the guy that came up with the idea of what became Homma actually took it to the founder Richard Liu of Jingdong.

And Richard Liu said, what a ridiculous idea, we're not going to do that.

So this guy, Hou Yi, he's called, he then took it to Alibaba and they started supermarkets which currently have about 400 to 500 supermarket stores around China.

And JD had to copy that when they saw it was so successful.

So and they have about 60 stores.

So they're very far behind Fresh Airpo.

So they have that and that's also linked again to instant retail.

So you can place an order also online and also get that delivered within 30, 45 minutes.

But another thing that they are doing.

So basically the examples I gave add up to thousands of stores and you can find them everywhere in, in China you can find them in the first tier cities, you can even go to very small towns and there will still be a small JD home appliances store there.

So they have a very big offline presence.

Now another thing that they did is they started testing with unmanned stores.

They have this sub brand called jdx where at the time that Amazon was trying out the Amazon Go concept, they were actually also having something similar.

But they closed that down even before Amazon started closing their ghost stores years before in China.

They already figured out that this is not going to work, at least not for now.

So that's something that you see JD doing there.

They experiment a lot and they are, they should be applauded for that.

Another thing that they're doing recently is it's become so incredibly expensive in China to acquire customers offline or sorry, online because of the enormous competition.

So.

And JD realized well, if we completely are going to evaporate our cash reserves if we do that online only.

So they actually went the opposite direction of what a lot of of European stores have been doing.

They started opening shopping malls under the name JD Mall.

Now JD Mall is quite interesting because if you walk in, they have one that we are going to in in the upcoming tour in Siam, they have something like five or six floors and every floor has a theme.

So the first floor could be computers and phones and then you have kitchen equipment and then you have air conditionings, etc.

And they have these shops in shops.

So actually the brand staff they run, they are the product experts.

But at least I think half of the staff are actually JD staff.

They're there for customer service and they also are there to keep an eye on the brand stuff to make sure that they're not selling too aggressively.

Because the whole concept is about experience.

So if you go into a JD Mall, you don't have a salesperson that tries to sell you an espresso machine.

No, they teach you how to use one of these machines.

So you make your own coffee.

You can take your clothing and just wash your clothing in a JD Mall.

So you get to experience what that washing machine is like.

You can cook together with the JD staff just to see what the kitchen equipment is like.

So it's very experience based.

And especially in the weekends they also have all kinds of things for kids.

They've got these robot dogs running around to play with.

So it's very experience based.

And what they found is that this actually to get people from the community around one of those malls to come to the mall and then register as a customer or buy something has lower customer acquisition cost than online.

So that's why they've now been expanding all of these JD malls around the biggest cities in China.

Now that is something that could potentially also be something that rubs off on se economy.

It is, it's something that this economy managers have been dreaming about for the last years basically because I mean mediamark itself has opened and Saturn as well.

A variety of experience stores, of concept stores or flagship stores in which they try to offer these kind of experiences to the customers.

It's just.

It's not working the way it should, I think.

Over here.

Correct.

I've been to one of those stores in Rotterdam about three years ago when they were opening it there as well.

It's really popular in China.

That doesn't mean that it will be popular here as well.

Of course.

It's very labor intensive work also at the same time.

So it's.

It has to be seen if that is something that would also catch on here.

But it is something that is definitely working in China.

I can remember when we were in Beijing, one of the JD malls with the last K5 tour, there were a couple of people in the group that were very experienced in offline retail and they were walking around going like this is never going to work.

This is going to be so expensive.

And I had to explain to them.

But you have to see things from the Chinese perspective.

Yeah.

And it cost them less to acquire a customer here than online.

And at the same time they're renting out all of this retail space to these brands that are paying for most of what you see here.

So.

Well, you know, that actually explains a lot about the advertisement power that Timur Sheehan or Alibaba Express are pushing into the European market.

Because if they are used to these kind of prices, I mean, I guess they don't really care, just spend money as on customer acquisition.

The more the merrier in a way because they.

That's what they do at home anyway.

Correct.

And I think it's really interesting.

It's much cheaper to acquire a customer in Europe than in China.

You should really not underestimate how expensive that is in China.

Yeah, amazing.

Just looking at the time, but we still have a few minutes left.

And I know that you have been looking a bit deeper into the food delivery war, I think you called it, with the several Chinese players and JJD with seven Fresh Kitchen is one of them.

So how is that playing out?

Maybe give us a short introduction into this area of their retail business.

So JD never had a very big food delivery business.

Alibaba had that with Erleme, had that with Meit one by Mike.

JD did some food delivery business, but it was not on the scale worth mentioning.

So they decided in March last year to also get into the food delivery business business.

Now there's two reasons for that.

First is what they call high frequency driving low frequency in China.

And it means that food delivery and ordering food, which is I think that more than one third of all meals from restaurants are actually home delivered in China.

And that's not just pizza and sushi, but that's, that's anything, anything that you can, can eat.

So high frequency, high frequency user scenario, people order a lot of food to be the home delivered.

So the idea is if you have such a high frequency scenario, just like grocery delivery, and people open your app, which in China is most of the time is like a big ecosystem with all kinds of different functionalities, they will also start buying your e commerce stuff and they might do other things that you have in your ecosystem system.

So that's one reason why JD again wanted to use that.

And eventually they even said like it's costing us less to give away subsidies for people that are using them to have almost free meals home delivered than to acquire somebody through buying traffic from a douyin or another platform.

So that was one thing.

The other thing is that what the most important trend at the moment in China is instant retail.

Because you have the traditional retail where you might have to wait for 2, 3 days for your package to arrive, unless you order it with jd then most of the time you get it in half a day.

So that is really a market that's booming at the moment.

And that is what all of the big Internet companies are focusing on.

And jd, even though they were one of the first ones to start this instant retail or quick commerce as it's often called in Europe, they were falling behind.

Meituan is the market leader.

Alibaba is also strong.

And JD was falling behind.

And one of the things they needed is more density, more couriers, more Merchants, more consumers, otherwise everything falls apart with instant retail.

So that's another reason why they started to do home food delivery to also help build an army of couriers for their instant retail business.

So that hasn't really panned out the way they hoped.

And that's because Alibaba also came into this market and started pouring in like probably by now 70, 70 billion renminbi in in funds, just giving that away as consumer discounts.

And then meit1 also had to step in to fight and defend their, their market share because they had 70% market share.

Now JD has sort of shifted strategy.

So instead of trying to get the traffic, what they've said is what we're going to do is we're going to go up the supply chain.

So instead of us being the courier that delivers it from a restaurant to your door, what we'll do is we will become the restaurant.

We will open up seven Fresh kitchens.

Now seven Fresh was also already a known brand because they had these supermarkets in China and they opened sort of dark kitchens where you couldn't eat, but they would prepare.

And one of the things they said is we are trying to fight a lot of dark kitchens that have appeared that are offering really low and sometimes even dangerous food quality.

So we want to become the supply chain.

And thereby again via JD we will get the consumers trust to order with us.

And we don't just deliver with our own, with our own courier service, but also Mateuan and Alibaba can also order from that or order from seven Fresh Kitchens.

So that, that is a trend that is now happening that you see a lot of these Internet companies going up the supply chain and actually becoming the, the restaurant business.

And I don't know when this podcast will drop, but at the end of this week I will be publishing a report on Tech Boss China which is specifically about the seven Fresh Kitchens.

A really interesting development that is going on there.

And, and so absolutely different from everything that is happening over here.

And it always find it funny when I talk to you because I will always get this idea that I know Europe is something like low hanging fruits for all these Chinese guys because they are fighting so hard for dominance over each other in their home market.

And, and whenever they need some new customers, they can just pop over to Europe for a bit and gather some there and then go back to fighting.

Or is that like just my mind making things too easy here?

No, I think there's a lot of truth in that.

I think one thing that we have to realize is that the market in China has sort of become saturated.

There's no new customers coming into the market.

So everybody is fishing in the same fishing pole, which makes it so expensive and which turns into what they call in China naijan, which means involution.

Everybody just throwing a lot of resources at it, but.

But nobody's gaining anything anymore.

It's a rat race.

It's like the, the guinea pig in, in that wheel.

You don't get one centimeter further than that.

You have been another thing that is so that's one of the reasons that we talked about before, also why Temu and tech talk show and Shein are coming to the Western markets now.

Another thing of course that is happening is if in the US they raise the import tariffs for these platforms, then they will shift their attention to Europe and they will push harder on Europe.

So that's one of the two reasons why they are so active in our markets.

If you had Tibet, is JD one of the players that you see being successful in Europe besides Timu and she and AliExpress, do they really have an understanding for the market and a chance here or.

Yeah, I think there's a couple of things that we should take into account.

First of all, they don't have any brand awareness.

They also, I think couldn't use the name JD because there was already a JD Sports store.

So they had to use something else which became Ochama and is now Joy Buy.

But they have to build that from scratch that that brand awareness.

And especially if the sites remain in beta and are a bit dodgy, you won't gain people's trust.

So I'm not so positive about the future of Joy Buy unless they really start upping their game.

Also in their marketing communication, I see much more in this economy deal because they are so experienced in China because they are so strong in their supply chain and especially in the product categories.

That media market and Saturn are also of course very strong in home appliances and consumer electronics.

So I see more potential success there.

But then again, it depends on how they handle this because I think JD is a classic case.

But when we talk about E commerce in China, we often talk about how ebay screwed up.

When they came to China because they didn't localize, they thought, oh, we're just going to take the US Side, we're going to roll it out in China and we're going to make lots of money, which didn't happen because nothing, whether it was payment methods or communication or they didn't have a way to discuss the deal with A merchant because they wanted to have everything closed.

They didn't want to go to deals, go offline or off platform.

So they did everything wrong.

And basically it was about lack of localization.

Not enough local people, not enough knowledge about the local market.

And what I see with Ochama and Joy Buy is, is the same mistakes that the Americans made when they came to China.

So they have to be doing much better there both in Joy Buy.

And I hope that when they, they get more involved in, in economy that they also do it there.

But I think that in economy least have the local employees that they can build on.

Yeah, absolutely.

Yeah, I'm going to watch that closely because I really wonder how this will affect the growth of mediamarkt as well because they have been doing exceptionally well over the last two, three years because they started out sluggishly into E commerce and then had quite a boost.

And I wonder if this will continue now or if it's going to have a little break in there which will take, which, which the Chinese managers maybe need to take to understand the European market and then focus on the right things.

But yeah, we'll see.

Anyway, one more thing that I, I should mention that's a consumer side of things.

So of course media market is, is already selling a lot of Western brands.

Now.

JD is also selling these Western brands in, in China.

So if you combine this volume, that means that JD will have a higher bargaining power.

Now on top of that, if you see these Chinese brands coming in to do the markets, the, the thousand brands that Richard Liu mentioned that he wants to take globally nowadays, a lot of these Chinese products are really, really good.

We still sometimes say Made in China is, is our shoddy goods, but the stuff that they are selling is really good stuff.

So what I expect is that for the consumers, whether it's a Western brand or a Chinese brands, that the prices might go down.

And that is an interesting development for, for you and me.

Yeah, absolutely.

And for the competitors as well.

So.

Yeah, okay.

I guess we will just keep on talking every half year and talk about things that are now happening in the Chinese communities is world.

But thanks for today, Ed, and thanks for joining me.

You're welcome.

Thank you.

Right, thank you all for listening.

Of course.

And next week be sure to.

Yeah.

Drop in again and follow me when I'm talking about agentic commerce and how it affects brands in the modern world.

We'll see then.

Right.

For now.

Bye bye.

You listened to let's Talk Marketplace, the Marketplace podcast with Ingrid Lommer and Valerie Dichtel.