Dada Nexus Limited (NASDAQ: DADA) (“Dada” or the “Company”) is a leading platform for local on-demand retail and delivery in China. The Company operates JD-Daojia (“JDDJ”), one of China’s largest local on-demand retail platforms by GMV in 2019, and Dada Now, a leading local on-demand delivery platform in China by number of orders in 2019, according to the iResearch Report.
Powerful on-demand delivery infrastructure is indispensable to local retail in the new era. To seize the growing market opportunities, five years ago Dada founded Dada Now, an open local on-demand delivery platform. Leveraging cutting-edge proprietary technologies and deep insights into the logistics industry, Dada Now has developed into a leading local on-demand delivery platform in China open to merchants and individual senders across various industries and product categories. As of March 31, 2020, Dada Now’s intra-city delivery service covered more than 700 cities and counties in China, and its last-mile delivery service covered more than 2,400 cities and counties in China. Dada Now was the largest open on-demand delivery platform in China by number of orders in 2019, according to the iResearch Report. The strong on-demand delivery infrastructure enables Dada Now to serve as the backbone to the Company’s partners.
In 2016, Dada extended its core capabilities from local on-demand delivery to local on-demand retail by acquiring JDDJ, the former local retail platform and a strategic asset of JD Group. JDDJ has since quickly built its reputation by delivering top-notch services to retailers and brand owners and offering high-quality on-demand retail experience for consumers. For instance, the Company partners with almost all the leading supermarket chains in China, including Walmart, Yonghui and CR Vanguard. Moreover, as one of the world’s most reputable retail chain giants, Walmart Group extended its trust and support to us through its investments in our company and comprehensive strategic cooperation with us. In 2019, JDDJ was the largest local on-demand retail platform in the supermarket segment by GMV, according to the iResearch Report.
Dada has successfully managed the integration of Dada Now and JDDJ to develop into a leading platform for local on-demand retail and delivery in China. The Company operates its local on-demand delivery platform by leveraging a crowdsourcing model to address the challenge of frequent fluctuations brought forward by the nature of on-demand orders, and to match the surging demand for delivery capacity with efficient supply. Dada’s delivery network demonstrates great scalability in operation. Dada Now enjoys a strong network effect across the platform. The growing number of merchants and individual senders using its platform enlarges order volume and density, which attracts more riders to join the network. More riders improve the delivery experience, which in turn fuels the growth of order volume and density from merchants and individual senders. Dada is continuing to invest in and enhance its delivery model, optimize operational efficiency and improve delivery experience for every merchant and individual sender on its platform.
The Company’s on-demand retail platform is designed to facilitate digitalized transformation for all retailers and brand owners. Apart from Dada’s acclaimed delivery experience, the Company also offers a wide range of services and solutions to retailers, optimizing their operational and fulfillment efficiencies. Furthermore, the Company enables brand owners to conduct product launches and efficient marketing on JDDJ. With these solutions, Dada has built a platform with steadily growing and loyal participants, forming a virtuous cycle. More retailers increase the product choices on the platform, and more consumers place an increasing number of orders, boosting sales for retailers and in turn amplifying marketing effectiveness for brand owners. As the platform attracts more retailers and brand owners, more product offerings with greater variety are available to consumers.
The Company’s two platforms are inter-connected and mutually beneficial. The Dada Now platform enables improved delivery experience for participants on the JDDJ platform through its readily accessible fulfillment solutions and strong on-demand delivery infrastructure. Meanwhile, the vast volume of on-demand delivery orders from the JDDJ platform increases order volume and density for the Dada Now platform.