Vip.Com Last Year'S Fourth Quarter Revenue Of 26 Billion 100 Million Yuan, Good Product Sales Strategy Results Burst

Beijing time on February 21st, vip.com disclosed the unaudited 2018 fourth quarter earnings report. Earnings data showed that in the four quarter of 2018, vip.com achieved a net revenue of 26 billion 100 million yuan (RMB, the same below), an increase of 8.1% over the previous year, which was in line with the expectations of the company. In addition, vip.com's net revenue in 2018 was 84 billion 500 million yuan, up 15.9% over the same period last year.


Vip.com CEO Shen Ya believes that vip.com's four quarter business results confirm the effectiveness of the good cargo strategy and said, "in the future, we will continue to strengthen our core competencies and provide users with high quality products every day, which will promote our long-term growth and profitability."


Fu Ying Fu, a senior researcher at Suning Financial Research Institute, told reporters that "vip.com's strategy of return sale and good goods is essentially a continuation of its core competitiveness, that is, its ability to control commodities."


Good product sales strategy results highlighted


In July 2018, Shen Ya made clear the strategy of vip.com's return sale at the strategic communication conference of the company at the middle of the year, and stressed that "we should do what we are good at". After that, vip.com's main station launched a discount sale channel like "only product rush" and "last mad rush", and began to implement the cargo strategy. Driven by the strategy of return sale and good goods, vip.com achieved a net profit of 914 million yuan in the fourth quarter of 2018, achieving a continuous profit in the twenty-fifth quarter.


"Good goods are the essence and core competitiveness of retail enterprises". Vip.com CFO Yang Donghao told reporters that in vip.com's special sale mode, good cargo is an important part of the decisive role, focusing on good products is vip.com's long-term strategy.


For the specific implementation of the "good goods strategy", vip.com introduces that the company provides differentiated products for the platform through brand cooperation and professional buyer team, and establishes the naked price policy for the parity system. After fully establishing the good cargo supply system, it displays the "good goods" through the quality control checks to consumers on the vip.com discount sale channel.


Fu Yifu believes that compared with other business platforms that are good at creating consumer scenarios, vip.com's strategy of good goods is to concentrate on cultivating its advantages and maintain its brand image and industry status through its ability to control goods.


Vip.com's good strategy and the return of its sale mode have won the market affirmation. In the fourth quarter of 2018, the number of active users of vip.com was 32 million 400 thousand, an increase of 13% over the same period last year. During the reporting period, the total number of orders reached 140 million, an increase of 35% over the same period. In addition, vip.com's stock user's deep operation is obviously effective, of which the number of vip.com super VIP members increased by 38% over the previous quarter, reaching 3 million 200 thousand, and the users were also effectively recalled.


In addition, the strategic cooperation between vip.com and Tencent and Jingdong also reached the company's expectations. In the fourth quarter of last year, Tencent and Jingdong contributed 23% new customers to vip.com daily, and the growth rate of vip.com WeChat small program was 38%. Vip.com said that Future Ltd will continue to use the social functions of Tencent platform to explore different marketing gameplay, and further develop WeChat small program and Tencent to jointly upgrade the spanformation effect.


Clothing category helps improve business efficiency


Reporters noted that in addition to revenue and user growth, the fourth quarter of 2018, vip.com's operating efficiency also improved, its net interest rate and gross profit margin compared to the third quarter has been improved, respectively, 2.66% and 20.64%. Yang Donghao said that the main reason for the recovery of the company's operating efficiency was vip.com's concern for the high profit clothing category.


According to the company, since the fourth quarter of 2018, vip.com has chosen to spanfer some of the standard products from its proprietary business to the third party business platform so as to improve profitability. Yang Donghao further said, "in the current quarter, we began to spanfer some low profit products from our own businesses to third party platforms to reduce their impact on our efficiency."


In addition, reporters learned that after adjusting the layout of the category, vip.com chose to include the income generated by the above third party business platform into the GMV (website spanaction amount), but did not fully account for the total net revenue. Because of this change in revenue structure, vip.com began to disclose GMV in the earnings report, providing an additional perspective for the market to measure the scale of business. Yang Donghao said the move aims to increase shareholder returns, and the company will continue to focus on stabilizing margins.


Fu Yifu told reporters that the practice of vip.com is widespread in the electronic business platform. By doing so, the company can increase sales and increase profits and GMV without increasing costs. "This is a good thing for the company, and companies can focus on the kind and business they are good at," Fu Fu added.


According to the financial report, in the fourth quarter of 2018, vip.com GMV was 41 billion 800 million yuan, an increase of 15% compared to 36 billion 300 million yuan in the same period in 2017. The company said that since the four quarter, the higher profit apparel category has contributed to GMV's contribution.