Dangdang (DANG, Financial) delivered an excellent quarter of healthy growth and demonstrated impressive profitability for the fourth quarter consecutively.
Its balance sheet looks solid with a total of RMB1.7 billion in cash and cash equivalents and having no bank debt.
Looking ahead
The new brand uniqueness signifies its ongoing commitment towards offering genuine premium product at reasonable prices for gaining the recognition and trust of its customers. This exciting new image is estimated to match the present customer base and expand the new customer base.
Dangdang witnessed significant traction for mobile Dangdang and its Dangdang e-reader app. It introduced many innovative online shopping channels, like Dangdang Jeans and ShipNow on mobile Dangdang, primarily for attracting the youth, fashion-conscious men and women for developing its status as a fashionable brand.
Dangdang launched a new and innovative version of the Dangdang e-reader app having greater number of digital book SKUs and innovative features for improving the online book reader’s engagement and enhance customer tackiness. These significant efforts resulted in impressive mobile orders growth, accounting for 24% of entire orders during the quarter over just 10% during the same period last year. The mobile Dangdang is forecasted to grow continuously, going forward.
In order to support these significant new launches, Dangdang is bound to have a vast handling and distribution network globally. Its network comprises of 2,491 towns and cities throughout China. There’s reduction in the delivery time. Dangdang is very well positioned in lower-tier cities and also enhanced its capacity for better serving top-tier cities in the quarter.
Making the right moves
Dangdang leverages several innovative channels for optimizing its promotion and advertising activities. The number of existing customers and fresh customers improved with lower new customer acquisition costs. The management has invested aggressively in mobile Dangdang, illustrating excellent results, and has deepened its strategic relationship with major mobile media partners.
Dangdang offers an immersive shopping experience with top categories delivering a personalized, diverse and vibrant shopping environment. Dangdang has over 15 years of e-commerce expertise and is well-equipped to develop customer loyalty, draw new customers at an effective cost and continuously improve the customer experience.
The company plans to improve its mobile platform monetization and further grow its marketplace and major business segments targeting the innovative destination categories such as home and lifestyle, baby and maternity, fashion and apparels.
In total, its complete general merchandise sales, including both marketplace and first-party, expanded 68% on year-over-year basis and improved media and books sales consecutively for the eighth quarter, illustrating its ongoing success in shifting the company’s image from being an online shopping store to a combined online shopping experience, with popular destination segments.
Dangdang grew its new customers count by 24% on year-over-year basis to nearly 3.6 million. Existing customer count enhanced by 14% on year-over-year basis to approximately 9.6 million.
The typical contribution per customer increased 32% to RMB382, an increase from RMB289 during the same period for the previous year. Total orders during the third quarter added to 18.8 million, growth of 19% on year-over-year basis.
Shareholder-friendly
Beginning September 30, 2014, Dangdang had held-to-maturity investments, short-term time deposits, cash and cash equivalents of RMB1.68 billion as against RMB1.21 billion by December 31, 2013.
In addition, Dangdang generated operating cash flow of approximately RMB80.2 million during the third quarter of 2014, making it a good investment.
