SECOO rang the opening bell at the Nasdaq Stock Market on September 22 this year. It is the first Chinese e-commerce company to file an IPO at Nasdaq since China’s tech giant Alibaba was listed in September 2014.
SECOO, established in 2008, is China’s largest luxury products and services platform. It provides premium lifestyle retail services to high-end Chinese consumers whose demand for luxury products is on the rise.
SECOO is backed by numerous known investors. Notable sources of funding include Bertelsmann Asia Investment (BAI), which invested USD 30 million in SECOO, along with IDG, Ventech Capital, and Crehol China, in 2012.
SECOO’s market value has grown substantially. BAI’s managing partner, Long Yu, spoke to AllTechAsia last week to further explain the value she sees in the platform.
Long first corrected the misconception that SECOO is merely a luxury product sales platform. “SECOO is rather a premium service aggregation platform,” Long said.
“SECOO has 15 million Chinese high net worth individuals on its platform. That’s its core value,” said she.
Positioning itself as a one-stop platform for its consumers that sells deluxe products is not what SECOO is really interested in. In Long’s eyes, to comprehensively and completely meet the needs of these consumers is what SECOO is doing. The value behind these consumers is the real fortune of SECOO which is not apparent in the short-term, she said. “IPO is just the beginning. There’s more time for SECOO to realize its potential.”
Long said that SECOO has proven itself with its financial reports in the past year.
Its 2016 GMV was RMB 3.47 billion (USD 511.9 million) and SECOO said that, by the end of June 2017, its GMV reached RMB 1.925 billion and is increasing at a rate of 50% each year.
“The stimulation of the productbrand itself will be less appealing to consumers in the future. Experiential services are more important to attract and maintain consumers ,” she added. Many luxury brands sell their products on their own website. But it is more like an online product directory without much service in it. Premium service is what SECOO are focusing on and good at, she said.
SECOO now uses big data with its developed algorithm to analyze its consumer behaviors in order to provide better services. It recognizes and analyzes consumers’ preferences by what they browse, the products that they buy, as well as their favorite collections. On the other hand, the system analyzes the features of purchased products so that it can better understand why consumers would buy them and under what circumstances. It offers tailored recommendations of items to consumers.
With its big data technology, SECOO has won the hearts and minds of consumers. The consulting firm, Frost & Sullivan, said that considering its GMV, SECOO had the largest market share among luxury product ecommerce platforms, with a 25.3% market share in 2016.
(Top photo from Pexels)