If we need one figure this week to tell how the US economy is going – then the Walmart US store comparable sales is the one: 3.2% yoy.
WSJ – Walmart’s Sales Growth Streak Hits Five Years
Dots to connect: inflation, Walmart’s online sales growth, international sales growth, tariff impacts, etc.
Following up on the update for cannabis public companies, here is a video for the weed-adjacent dietary supplement known as cannabidiol, or CBD.
One year after the legalization of recreational use of cannabis in Canada, and following up on the previous discussion of those public companies gathering partners/supports, ramping up production and declines in ASP, here is an another snapshot as of 2019 Q3.
The number of kilograms sold is soaring.
But ASP keep falling.
And here is the graph for aggregated market cap of cannabis companies as of 11/15.
Paying to become a member of a video platform has gradually become mainstream in China, at least for the younger generations.
Consumer behaviors have been changing from searching for free sources (as there are fewer of them now than before) to paying for high quality and hassle-free subscriptions.
The leading platforms, iQiYi and Tencent Videos, have paying members exceeding 100 million in 2019 Q2 and 2019 Q3 respectively. The paying percentage is around 20% for a 500 million MAU (iQiYi 2018 Q4 MAU 454.5 million).
Alibaba’s Youku is only little behind (numbers are not disclosed).
Similar trends are found in Tencent Music and NetEase Music. While paying percentage is ~4-5%, it is picking up. Tencent Music’s online music paying users grew 42.2% yoy to 35.4 million (5.36% of 661 million MAU).
Emerging platforms like Bilibili are also seeing more paying users percentage.
As Direct-to-Consumer (DTC) businesses are booming and going public as companies, their earnings report gave us some insights into their gross margins and what those products cost the companies to produce (cost of goods sold is the flip side of gross margin).
Canada Goose, in their Second Quarter Fiscal 2019 results, said that DTC gross margin is 75.6%, a 40 bps increase from last year.
cost of goods sold: 24.4%
Moncler similarly has a gross margin of 76.6% for 2019 H1.
cost of goods sold: 23.4%
Tiffany in the most recent quarter has a gross margin of 62.7%, decreasing from 64% the year before. LVMH recent announced its attempt to acquire Tiffany.
cost of goods sold: 37.3%
Even the giant consumer staples company Procter & Gamble’s gross margin stays at 47.7%.
cost of goods sold: 52.3%
Beyond the transaction fees charged by AliPay and WeChatPay, CB Insights outlined five major growth opportunities.
See full report here.
Shanghai Green Valley Pharmaceuticals (Green Valley, 绿谷制药) today announced on Nov 2 that China’s National Medical Products Administration (NMPA) has approved Oligomannate (GV-971) as new drug for the treatment of “mild to moderate Alzheimer’s disease (AD) and improving cognitive function.” It is the first novel drug approved for Alzheimer’s disease globally since 2003. The company is also planning a global phase 3 trial with sites in the U.S., Europe and other parts of Asia in early 2020 to support regulatory filings around the world. // prnewswire | fiercepharma
On Nov 5, Nio (NASDAQ: NIO), long being seen as the Tesla in China, announced its partnership with Intel’s Mobileye to build self-driving EVs. Under the planned collaboration, Mobileye will provide NIO with the design of the self-driving system building on the Mobileye AV Series, a L4 AV kit comprised of the Mobileye EyeQ® system-on-chip, hardware, driving policy, safety software and mapping solution. NIO will take on the automotive-grade engineering, integration and mass-production of Mobileye’s system for both consumer automotive markets and for Mobileye’s mobility-as-a-service (MaaS) applications. In addition to integrating the self-driving system into its vehicle lines, NIO will develop a specially configured variant of electric AVs that Mobileye will use as robotaxis, deployed for ride-hailing services in global markets. // TechCrunch| intel
36Kr (NASDAQ: KRKR), a Beijing-based news and data provider, known for tracking fundraising and tech related news in China, raised $20 million in its Friday debut on NASDAQ. The company is similar to TechCrunch or Crunchbase (its affiliated Crunchbase News). // Crunchbase News
On this annual shopping festival, we could see how Chinese consumers are growing their spending.
Alibaba’s Tmall reached 10 billion yuan in less than two minutes (00:01:36)
With updated info: Alibaba singles day sales GMV stood at 268.4 billion yuan (~$38 billion), growing 26% from last year.
Dots to connect: competitions from JD and Pinduoduo?, growth okay, houses being sold on platforms, live steaming as a new type of sales & marketing but costs?
It is an interesting story to watch as LVMH became the second-most valuable company in Europe
The current Meituan (MeituanDianping) came from a merger between Meituan and Dianping in December 2015.
Once a company invested by Alibaba, Meituan has become more closer with Tencent after the merger.
At the beginning of 2016, MeituanDianping raised $3.3 billion from Tencent, DST Global and Temasek at a $15 billion pre-money valuation; meanwhile, Alibaba sold its stake for ~$900 million in the same month.
Later that year, in April 2016, Alibaba invested the $900 million in Ele.me and Ant Financial invested $350 million.
The war has already changed from Yelp and Groupon to more comprehensive areas – restaurants and other local services.
[Note – in 2014, Priceline (now Booking.com) agreed to buy restaurant booking service OpenTable for about $2.6 billion in cash. But in China, dining is not exactly scheduled by time but by getting a number into the line, determined by how many people are ahead of you.]
However, US and China are similar in the world of food delivery. Meituan and Ele.me are fighting in China while Uber Eats, DoorDash, GrubHub, PostMates are fighting in the US. The difference – China uses e-bikes and US uses cars.
And for other services like movies, Meituan spun-off Maoyan in 2016. Maoyan is competing with Tao Piaopiao, which raised ¥1.7 billion in 2016.
In the US, the market is led by Fandango and Atom Tickets. But the market is not limited to movies – it’s about all kinds of shows, concerts and exhibitions.
Meituan is also offering hotel & travel bookings, fighting in the war with Ctrip.
Going back to Meituan, it raised $4 billion in October 2017 from Tencent, Sequoia, GIC and Tiger Global.
Meituan Dianping introduced its ride-hailing operation Meituan Dache in February 2018.
In April 2018, Alibaba acquired Ele.me for $9.5 billion.
Same week , Meituan acquired mobike for $2.7 billion.
Later that month, Ant Financials led a round of $700 million for Hellobike.
Meituan went for IPO in Hong Kong in September 2018, raising $4.2 billion.
Another OTA, Tongcheng-Elong, with Tencent and Ctrip as major shareholders, went IPO in Hong Kong in November 2018, raising $180 million.
Summing up the wars Meituan is in: