In recent years, the development of the fresh retail market has always been concerned by the market, in this case, the market performance of various companies is particularly attention-grabbing, in this context, Dingdong Grocery handed over its own report card, the first time to achieve annual profits, the track of fresh retail has finally run through?
1. Dingdong Grocery achieved annual profit for the first time?
According to a report by Nanfang***, Dingdong Grocery released its fourth quarter 2023 performance report. Dingdong achieved revenue of 49 in the quarter900 million yuan, with total revenue of 6.2 billion yuan in the same quarter of 2022; The GMV is 55300 million yuan, and its own products accounted for more than 20% of the total GMV for the first time; The net loss for the quarter was $4.4 million, compared with a net profit of $49.9 million in the same quarter of 2022; Net profit under the non-GAAP standard was 16.3 million yuan, compared to 115.8 billion yuan, with a net profit margin of 0.0 billion on a non-GAAP basis3%。Dingdong revealed that as of the quarter, Dingdong has achieved profitability under the non-GAAP standard for five consecutive quarters, and has also achieved its first annual profit under the non-GAAP standard.
Kunpeng Plan Dingdong's private label products in recent years have a relatively bright performance in the fourth quarter, and its own brand products exceeded 20% of the total GMV for the first time in the fourth quarter, an increase of 3 over the same period last year1 percentage point. The GMV penetration rate of the three categories of prepared vegetables, pork, and soy products also exceeded 50% throughout the year. Among them, non-fresh private label products accounted for 34 percent of the total GMV of non-fresh products3%, an increase of 77 percentage points.
Second, the fresh retail track has finally run through?
A few days ago, Dingdong Grocery announced its first annual profit, which is undoubtedly a major breakthrough in the fresh retail track. So, what exactly does Dingdong's report card mean? Is the fresh food retail track really running through?
First of all, the growth process of Dingdong can be described as a history of the development of fresh e-commerce. From the initial rapid expansion, to the subsequent adjustment and transformation, every step is full of challenges and opportunities. In the stage of rapid expansion, Dingdong has won the favor of many users with its efficient chain management and high-quality service. However, with the intensification of market competition and the diversification of user needs, Dingdong began to realize that simple expansion could not bring sustainable development. As a result, it began to change its thinking, focusing on improving product quality, optimizing service experience, and expanding its own brand. This steady and steady strategy not only makes Dingdong stand out in the highly competitive market, but also lays a solid foundation for its future development.
Secondly, in the retail market, commodity power is one of the core factors that determine the competitiveness of enterprises. For Dingdong, it has successfully created a series of private label products through the promotion of its merchandising strategy, and has achieved remarkable results. According to the data, the user penetration rate of private label products has reached 736%, which means that more than seventy percent of users will choose Dingdong's own brand products when purchasing. Behind this achievement, it not only reflects Dingdong's accurate grasp of consumer needs, but also verifies the possibility of focusing on its own advantages. Through the creation of its own brand products, Dingdong not only improves the added value and profit margin of the goods, but also enhances the stickiness and loyalty with consumers.
Third, in terms of geographical strategy, Dingdong chose to focus on Jiangsu, Zhejiang and Shanghai regions for intensive cultivation. This decision is not only in line with the company's actual situation, but also reflects its deep understanding of the market. As one of the regions with the most developed economy and the highest consumption level in China, Jiangsu, Zhejiang and Shanghai have a huge consumer group and huge market potential. By focusing on this area, Dingdong can concentrate resources and make precise efforts to better meet the needs of local consumers. At the same time, through the successful practice in Jiangsu, Zhejiang and Shanghai, Dingdong can also accumulate experience and form a model, laying the foundation for subsequent national expansion.
Fourth, Dingdong's profitability is not only a change in financial figures, but also a verification of its long-term business model. As a typical asset-heavy industry, fresh food retail requires long-term investment and patient training. Through continuous technological innovation and chain upgrades, as well as continuous improvement of user experience, Dingdong has proved that it is possible to achieve sustainable profitability and development even in such a competitive and complex market. This point has important reference value for the entire fresh food retail industry.