Chinese unicorn ups e-commerce stakes in Middle East
By Muhammad Riaz Usman / Khaleej Times
With more than a decade's experience in e-commerce, serial entrepreneur Aaron Li believes the sector can empower the traditional retail industry and provide innovations to better serve customers.
"That's why I founded Jollychic and worked with more than 5,000 traditional manufacturers globally to enlarge their sales channel, as well as to bring customers more options for shopping," says Li, founder and CEO of Jollycorp.com.
Jollychic, a Chinese online store founded in 2012, has a value of $1 billion after a Series C round from the global venture firm Sequoia Capital in May 2018. This funding also made Jollychic the first 'unicorn' in the cross-border e-commerce industry.
Neil Shen, founding managing partner of Sequoia Capital China, says Sequoia has always attached great importance to innovative enterprises, especially those who can successfully apply new technologies and models to new markets and achieve rapid growth.
"Jollychic is an innovative enterprise good at applying Big Data and Artificial Intelligence technology to make business decisions in the new retail ecological field. Jollychic has established a highly intelligent business system which enables automation operation and business decisions by Big Data," Shen says.
With offices in the UAE, Saudi Arabia, Jordan, Turkey, the United States and China, Jollychic's prime focus is on the Mena market. And now, with this recent funding, its valuation has become one of the largest in the region.
The Chinese online retailer offers a variety of products, including clothes, electronics, homeware, furniture, beauty products and sports equipment, among other items. In 2016, Jollychic raised $1.5 million (Dh5.5 million) in a Series B round from Legend Capital and other investors. It also acquired Jordanian rival MarkaVIP last year.
"We cover both world-renowned brands and new brands by startup businesses. Through the enhancement of comprehensive service capabilities, sales have grown rapidly with annual growth rate of 300 per cent in the past five years," Li says.
"Till June 2018, Jollychic had over 3,500 employees worldwide, including a 1,500-people operation and customer service team in the Middle East, providing 24/7 service response," he claims.
Li believes the future direction for retail businesses is to combine online and offline shopping experiences to provide customers prompt, convenient and efficient service.
"Smart integration of online and offline [O2O] retail experience is the key and helps local retailers to create more revenue, as well as give customers a better shopping experience," Li notes.
"We launched our first smart pop-up stores in the UAE in December. Customers can experience the convenience and innovation brought on by the Internet and digital technology. By this innovation, we can empower retailers with a new model to get easier access to the digital economy," he adds.
"We hope more retailers come on board with us in our endeavour to create a win-win situation between O2O shopping to have retailers succeed in the digital economy. We believe this is what customers like and believe we are in the right direction," he continues.
Li says as one of the companies who pioneered e-commerce business in the Middle East, Jollychic is glad to see more companies recognise the value of online sales channels and attach high importance to e-commerce in their development strategy.
"We also see an increasing number of e-commerce companies have joined in and there is good competition now. We regard this as a positive stimulation for us to stay humble and diligent as we did from our first day," he says.
Li thinks that nowadays, the competition in e-commerce is shifting from getting website traffic to customer service. "That's why Jollychic invests heavily in services such as storage and logistics to satisfy the demands of our clients."
"In addition to strong investments in warehouse and logistics in the Middle East, in 2018, we launched several policies such as '15-days free return' and 'next day delivery' in some markets as a service option. We now work with more suppliers in the Middle East, including those in the UAE, to give our customers more options when purchasing with Jollychic," he says.
Li claims that Jollychic's data technology and AI system is the foundation of its daily operations.
"We have a group of hundreds of engineers working hard to apply machine learning and AI technologies for supply chain forecasting, smart recommendation engine, customer experience optimisation, etc. Technology supports various decisions in the daily operation of Jollychic, and also enables precise operations and satisfies the high frequent, fragmented and personalised shopping needs of consumers," he concludes.