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Chinese E-Retail Sales Pass USD 1 Billion Mark as Online Shopping Grows

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Chinese E-Retail Sales Pass USD 1 Billion Mark as Online Shopping Grows

FinancialBuzz.com News Commentary

PR Newswire

NEW YORK, October 19, 2018 /PRNewswire/ --

According to data provided by Digital Commerce 360, Chinese consumers moved more of their shopping online in 2017, which has resulted in e-retail sales passing USD 1 Trillion for the first time in the world's leading e-commerce market. The data indicates that retail web sales totaled 7.18 Trillion yuan (USD 1.149 Trillion) in 2017, an increase of 32% from 5.43 Billion yuan (USD 869 Billion) in 2016, according to China's Ministry of Commerce. E-commerce growth accelerated past the 30% mark in 2016, after slumping to 26% in 2016 from 33% in 2015. The technological boom of recent years and China's status as an emerging market has made China the leader in online sales. China far outpaces the United States, the second-largest e-retail market in the world, in both sales and growth. Chineseinvestors.com Inc. (OTCQB:CIIX), Alibaba Group Holding Limited (NYSE:BABA), JD.com, Inc. (NASDAQ:JD), Baozun Inc. (NASDAQ:BZUN), Pinduoduo Inc. (NASDAQ:PDD)

China's online retail market industry is projected to continue its expansion. According to data provided by Forrester, China's online retail market is expected to hit USD 1.8 Trillion in 2022, The Drum reported. Explaining the intricacies of the market, Forrester reports that, "Internet giants Alibaba and JD.com continue to dominate the local market, together accounting for more than 85% of China's e-commerce market. However new companies, such Pinduoduo and Xiaohongshu are catching up as users embrace new social commerce platforms... More than three-quarters (76%) of all e-commerce in China occurs via mobile devices and mobile payments remain the most popular choice for online purchases with 80% of metro Chinese shoppers using Alipay and 66% using Tencent's WeChat Pay to pay for a product or service in the last three months."

Chineseinvestors.com Inc. (OTCQB:CIIX) earlier this week announced that, "its subsidiary, CBD Biotechnology Co. Ltd., has entered into Alibaba Group's Tmall (NYSE:BABA), China's largest e-commerce marketplace for global and domestic brands and retailers. This move significantly expands the Company's footprint and reach of its full line of CBD skincare products to include Alibaba's 500 million registered customers on Taobao and Tmall just in time to welcome the Double 11, also known as Singles' Day, and Double 12 Shopping Festivals. These two national events occur between October and December and have historically yielded China's highest volume of sales for online merchandise, adopted by online retailers and driven by Alibaba's Taobao and Tmall. Singles' Day is a national occasion for single adults to celebrate and socialize, which is highlighted by shopping festivals.

Warren Wang, CEO of Chineseinvestors.com, commented, 'CBD Biotechnology Co. Ltd. is not only one of the first companies to produce and sell CBD skincare products in China, but now it is the first CBD skincare company to enter Tmall. We now have significantly extended our sales channel and through our dedication in educating our audience on the benefits of our product, believe that we are on the path to strengthening our brand influence for the massive cosmetics industry within China and the global Chinese community. From October 15 through the end of December 2018, our company will invest 2.5 million RMB in online marketing and advertising for all of our CBD skincare product lines. The total single day volume of transactions during the Double Eleven Shopping Festival in 2017 reached 168.2 billion. We are thrilled to be participating in the Double 11 and Double 12 Shopping Festivals this year.'

Alibaba's Tmall global e-commerce marketplace provides a variety of products and high-quality brands on its e-commerce online platform. According to the agreement, Tmall will feature CBD Biotechnology's skincare line for its 500 million registered customers, providing a new opportunity for CIIX to expand the reach of its products into the Chinese market.

Xiangyang Hui, CEO of CBD Biotechnology Co. Ltd., adds, 'Of the hundreds of thousands of companies that apply for authorization to be included on Tmall, few are approved, making this one of the most sought after e-commerce platforms. This is an amazing opportunity and huge accomplishment to successfully open our own store. We will be advertising on well-known online platforms and apps like Today's Headline, Tik Tok, Huoshan.com, Watermelon Video, Iqiyi and Baidu Information Flow. We estimate that from October 2018 to September 2019, the total sales of CBD skincare products will have the opportunity to reach 12 million RMB.'

In addition, yesterday Chineseinvestors.com Inc. announced, "its operational and financial summary for its First Quarter Fiscal Year 2019."

'CBD hemp sales in China continue to be the foundation of our focus,' says Mr. Warren Wang, Chief Executive Officer for ChineseInvestors.com. 'Our subscription services will continue to provide a steady revenue stream along with the new educational services covering the cryptocurrency market.'

During the quarter, cash and cash equivalents for the Company doubled from $1.4M to $3M, and total current assets have increased in one quarter from $3.2M to $5.5M. As of Aug.,31 there were 33,576,560 outstanding shares of common stock, with a closing market value as of October 17, 2018 of $0.90 per share. As the Chinese business, regulatory and political landscapes continue to evolve with regard to the industrial hemp CBD industry, Wang anticipates further positive developments for the rest of Fiscal Year 2019.

'With increased marketing resources devoted to our industrial hemp-based CBD products, we anticipate a productive Fiscal Year 2019,' says Wang. 'We look forward to increased product distribution both domestically and in the China markets.'"

Alibaba Group Holding Limited (NYSE:BABA) is a global retail marketplace that enables consumers from around the world to buy directly from manufacturers and distributors primarily in China. The Russian Direct Investment Fund (RDIF), the sovereign wealth fund of the Russian Federation, Alibaba Group, the world's leading retail commerce company, PJSC "MegaFon", a pan-Russian operator of digital opportunities (MegaFon) and Mail.Ru Group, the leading internet and IT company in Russia with growing international exposure, recently announced a new strategic partnership to integrate Russia's key consumer internet and e-commerce platforms and launch a leading social commerce joint venture in Russia and the CIS. Under the partnership, the parties will form a new joint venture (JV) by leveraging the existing businesses of AliExpress Russia. Collectively, the parties will inject new capital, strategic assets, leadership, resources and expertise to create an unmatched value proposition for merchants, consumers and internet users across Russia and the CIS, as well as accelerate the development of Russia's rapidly growing digital economy. Alibaba Group will contribute AliExpress Russia into the JV, which will consist of Alibaba Group's current Russia-based domestic and cross-border operations, including its global retail marketplace business, AliExpress, and first-party B2C business, Tmall, in Russia. Further, Alibaba Group will inject cash into the JV along with other resources to support the business of the JV. Michael Evans, President of Alibaba Group, said: "This partnership is an exciting step in Alibaba's international expansion, combining local leadership with our global ecosystem. By partnering with Russia's leading consumer internet platform, AliExpress Russia will help digitize and transform the retail value chain in Russia, enabling a seamless and innovative experience for consumers as well as creating significant opportunities for Russian entrepreneurs and SMEs to grow in their home market and expand globally. Our experience in China and other markets around the world makes us uniquely qualified to help build the future infrastructure of commerce in Russia and the CIS."

JD.com, Inc. (NASDAQ:JD) is China's leading technology-driven e-commerce company. JD.com, Inc. and Google recently announced that Google will invest USD 550 Million in cash in JD.com as part of a strategic partnership. Google and JD plan to collaborate on a range of strategic initiatives, including joint development of retail solutions in a range of regions around the world, including Southeast Asia, the U.S. and Europe. By applying JD's supply chain and logistics expertise and Google's technology strengths, the two companies aim to explore the creation of next-generation retail infrastructure solutions, with the goal of offering helpful, personalized and frictionless shopping experiences. JD also plans to make a selection of high-quality products available for sale through Google Shopping in multiple regions. "This partnership with Google opens up a broad range of possibilities to offer a superior retail experience to consumers throughout the world," said JD.com's Chief Strategy Officer Jianwen Liao. "This marks an important step in the process of modernizing global retail. As we celebrate our June 18 anniversary sale, this partnership opens a new chapter in our history."

Baozun Inc. (NASDAQ:BZUN) is the leading brand e-commerce service partner that helps brands execute their e-commerce strategies in China by selling their goods directly to customers online or by providing services to assist with their e-commerce operations. Earlier this year, Baozun Inc. announced its unaudited financial results for the second quarter ended June 30th, 2018. Total net revenues were RMB1,159.1 Million (USD 175.2 Million), an increase of 30.5% year-over-year. Services revenue was RMB 582.1 Million (USD 88.0 Million), an increase of 51.6% year-over-year. Income from operations was RMB 58.3 Million (USD 8.8 Million), an increase of 55.3% year-over-year. Operating margin was 5.0%, compared with 4.2% in the same quarter of last year. "We delivered another outstanding quarter in which we generated strong growth from our existing online stores and enhanced efficiency by deploying new and innovative tools," commented Mr. Vincent Qiu, Chairman and Chief Executive Officer of Baozun. "Our ability to rapidly adapt to changing market environment and develop new technology remains the key to our success. By enhancing our IT capabilities and expanding the breadth and depth of our technology services, we are able to create more value for our brand partners and drive future sustainable growth. We will continue to invest in building our long-term technological competitive advantage to further reinforce our market leading position in China's brand e-commerce market."

Pinduoduo Inc. (NASDAQ:PDD) is an innovative and fast-growing "new e-commerce" platform that provides buyers with value-for-money merchandise and fun and interactive shopping experiences. Pinduoduo Inc. recently announced its unaudited financial results for the second quarter ended June 30th, 2018. Total revenues were RMB 2,709.0 Million (USD 409.4 Million), an increase of 2,489% from RMB 104.6 Million in the same quarter of 2017 and an increase of 96% sequentially from RMB 1,384.6 Million in the previous quarter. The increases were primarily due to an increase in revenues from online marketing services. "I am pleased to report strong operational and financial results this quarter," commented Mr. Zheng Huang, Chairman and Chief Executive Officer of Pinduoduo. "GMV in the last twelve months increased 583% year-over-year to RMB 262.1 Billion while active buyers jumped 245% year-over-year to 343.6 million, which I believe demonstrates the value of our differentiated 'new e-commerce' business model and our ability to serve China's strong domestic consumption demand. We continue to allocate resources towards enhancing user engagement and strengthening our brand recognition, and we remain committed to investing in technology, with a focus on the long-term growth of our platform. I am confident in our conviction and ability to capture the enormous and growing opportunities in China."

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