Holiday economy, Dingdong Maicai secures $700 million round: Retailheads

April 07, 2021 CV TECH INC



A three-day weekend witnessed increased spending on domestic travel and entertainment. Online grocery delivery platform Dingdong Maicai secured a hefty $700 million round. Re-commerce site Zhuanzhuan received $390 million in funding, while rival Xianyu expects gross merchandise volume to surge 70% year on year in 2021. A merger between power bank companies Jiedian and Soudian will create the largest player in the sector.






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China’s e-commerce and retail market offers a fire hose of products, choices, business models, rapidly changing content, and more. Here’s what you need to know about China’s online retail market for the week of April 1–7.







Holiday economy



  • Data from China’s Ministry of Culture and tourism shows that tourist sites received 102 million domestic visitors during the Tomb-Sweeping Day three-day weekend, which ended April 5. This marks a 144.6% year on year increase, and a 94.5% recovery from the same period in pre-pandemic 2019. Domestic tourism revenue during the period increased 228.9% year on year to RMB 27.2 billion ($4.2 billion), or 56.7% from the same period in 2019. (21th Century Business Heard, in Chinese)

  • Travel orders made through online travel platform Trip.com surged over 300% year on year during the three-day holiday, on par with figures for the same period in 2019. (Jiemian, in Chinese)

  • China’s box office takings topped RMB 821 million during the holiday. (Xinhua)


Community group-buy cash-in



  • China’s online grocery delivery platform Dingdong Maicai has secured $700 million D round led by DST Global and Coatue to invest in business expansion, supply chain and team. The other investors joined the round include Tiger Global Management, General Atlantic, CMC Capital Partners, and Sequoia Capital. (International Finance News, in Chinese)

  • Dai Shan, a partner of Alibaba Group, says in an internal letter that the core mission of Alibaba’s “MMC” department is to support the digital upgrading of China’s more than 6 million “mom and pop” stores. The newly established unit is widely regarded as the e-commerce platform’s response to the red-hot community group-buy model. The company has not said what, if anything, MMC stands for. While the most popular group-buy businesses rely on “group heads”—usually owners of offline stores, housewives, or white collars workers with a side gig—to promote products to their neighbors, MMC focuses on providing product souring and supply chain management to owners of small stores, according to Dai. (Donews, in Chinese)

  • Chinese fresh food chain operator Qiandama is heading for an Hong Kong initial public offering as soon as this year, Bloomberg reported, citing people familiar with the matter. One of the sources says the offering could raise $400 million to $500 million, in addition to a planned pre-IPO round of about RMB 2 billion. (Bloomberg)


Crossing the streams


Alibaba is planning to bring its re-commerce service Xianyu, or Idle Fish, on Tencent’s WeChat mini-app platform, shortly after embedding bargain app Taobao Deals in the rival app. (Jiemian, in Chinese)


Re-commerce platforms



  • Zhuanzhuan, there-commerce platform owned by classifieds giant 58.com, has raised a combined $390 million funding from Greater Bay Area Homeland Development Fund and Qingyue Fund. This is the first funding the firm received since its merger with electronics recycling platform Zhaoliangji in April last year. The company says its revenue has increased over 200% year on year in 2020, making it the third straight year to double its revenue. (Shanghai Morning Post, in Chinese)

  • Alibaba-backed re-commerce platform Xianyu expects to record RMB 500 billion gross merchandise volume (GMV) this year, local media reported. That will be a nearly 70% year-on-year surge based on the business’ RMB 200 billion GMV from last year as revealed by Alibaba’s annual earning report. (Lanjing, in Chinese)


READ MORE: China re-commerce faces tug of war between growth and trust



When our power banks combine…


Power bank rental companies Jiedian and Soudian announced a merger Thursday, the same day rival Energy Monster went public on the Nasdaq market. The new company says it will have a combined 360 million users—which is more than Energy Monster’s 219 million. (Ebrun, in Chinese)


Logistics


Alibaba logistics arm Cainiao announced Tuesday an agreement with US-owned air cargo company Atlas Air to launch a flight operation program linking Hong Kong, China to Bogota, Colombia and Lima, Peru, with Santiago, Chile or Sao Paulo, Brazil as the connection point. (Cainiao statement)