China ecommerce giant JD.com, market-leader Alibaba’s biggest rival (and therefore Amazon’s second-biggest rival in the country), saw its gross merchandise volume (GMV) grow at more than double the rate of Alibaba’s in the third quarter of this year.
GMV represents the total value of transactions for all products and services on its ecommerce platform. While Alibaba recorded a year-on-year GMV growth of 28 percent for the third quarter of this year (hitting $112 billion), JD.com on Monday announced a year-over-year GMV growth of 76 percent (hitting $18 billion).
That’s for the quarter ending in September. And yes, Alibaba still records a much higher GMV in raw numbers than JD.com.
But JD.com also beat Alibaba on year-over-year revenue growth with 52 percent (hitting $6.9 billion) versus Alibaba’s 32 percent (hitting $3.5 billion). So Alibaba doesn’t seem to be making as much revenue on its huge GMV — by all accounts, JD.com is seeing about double the revenue from its vastly smaller GMV.
That’s interesting and impressive as heck.
In any case, these are big numbers that will be even bigger in the fourth quarter, thanks to sky-rocketing Singles’ Day sales in China this month that generated $3.9 billion in sales for Alibaba in the first hour alone.
The heat between the two rivals was visible earlier this month, when JD.com announced that China’s watchdog agency has accepted a request for an inquiry into Alibaba’s practices on claims that they are “unfair” to merchants.
Richard Liu, JD.com founder and chief executive, attributed part of the stellar growth to a tie-up with Tencent’s mobile chat app WeChat, which now has around 650 million monthly active users — 200 million of whom have credit cards attached to their accounts.
“Our partnership with Tencent’s dominant [WeChat] and Mobile QQ platforms puts JD.com at the fingertips of virtually every Chinese mobile online consumer, and continues to drive rapid user growth,” he sad. “Looking ahead, we will stay focused on enhancing user experience, deepening ties with leading brands and working to further expand JD.com’s leadership in mobile ecommerce.”
Alibaba certainly seems to have its work cut out for it with this scrappy little underdog nipping at its heels — and by all accounts getting bigger every quarter. It probably won’t be seen as scrappy or little for very much longer.