Thomas Chong: And congratulations on a very solid set of results. My first question is about the logistics disruption due to the pandemic recently. How should we think about impact to consumer sentiment, user experience? And on that one, how should we think about the short-term impact to GMV and revenue growth momentum? And my second question is about the latest product category trend, of course, smartphones, consumer electronics, FMCG and apparels.
Lei Xu: And indeed, as you pointed out that the logistic fulfillment has been severely impacted by the COVID situation actually in the past 2 years. This year, it’s the most heavily affected. I want to share with you actually data here that in September to present in terms of our logistic fulfillment, 17% of our customer home addresses have been affected by these COVID control measures. And this doesn’t mean that it affects the order amount and the sales on JD. But indeed, this is the worst year in terms of fulfillment. And indeed, this situation — difficult situation will affect our sales and fulfillment. But also, I’m proud to share with you, according to China’s Post Bureau service recently, in terms of the service experiences, JD Logistics stands number one among this industry, which once again validated our efforts made in our supply chain capability building to help us to stand out and gain consumers’ trust in this difficult time.
And just also based on our data from the Singles” Day Grand Promotion, we do see a higher rate of order cancellations. It’s a higher cancellation rate than the past years because of the fulfillment difficulties and the longer waiting times. However, I want to emphasize here that people come to JD.com for more brand shopping. So we believe the cancellation rate for these platforms with more impulsive shopping or shopping based on their interest, the cancellation rate should be higher. And another group of people has attached great importance on our brand partners and merchants. And based on JD’s shopping features with more brand shopping and premier shopping experiences, this can translate to the better operating cost and the profitability for merchants and brands and make us stand out among all the other e-commerce platforms.
And in terms of the faster-growing categories, in Q3, we’ve seen that home appliances, fresh goods, health, sports and pets are doing a good job, also including our Shop Now services for the intra- retail and our offline business, Five Star Appliance stores. And for these less ideal-performing categories include cosmetics and mobile phones and — but also, we see that since September, some new phone model releases, the situation is getting better. And this will continue in the lead-up to Q4. And for this category, it’s affected by the limited shopping scenarios due to the COVID. And also, the baby and the mother category is affected due to the reduced newborns. And there are many categories on JD.com. And we are regularly reviewing those loss-making categories and make dynamic adjustments to maintain the healthiness across all categories.
And we have seen improvements on the performance of all categories and better satisfaction among brands and merchants. And despite of , we see their market share all continue to increase.
