Local Specialties Ride the Internet Wave to Achieve Online Sales

The potatoes of Dingxi, Gansu, the cured meat of Xiangxi, Hunan, and the red rice of Hani, Yunnan - these high-quality local specialties that were once “hidden in the depths of the boudoir, unknown to all” - are now entering vegetable markets in Beijing, dining tables in Shanghai, and refrigerators in Guangzhou through a thin network cable.

When the Internet meets local specialties, for rural areas, the “difficulty of selling” that caused “cheap grain hurts the farmer” due to unsalable harvests is being resolved; for cities, the regret of not being able to eat authentic local specialties and “hometown flavors” is about to disappear. The Internet “going to the countryside” and local specialties “going online” are rewriting the former rural poverty alleviation model, broadening traditional agricultural product circulation channels, and correcting the distorted urban-rural dual economic structure.

Local Specialties: E-commerce's New Hot Land, Internet Companies' Growth Point

On the eve of National Day, the largest domestic commercial retail enterprise——Suning Commerce Group and the State Council Leading Group Office of Poverty Alleviation and Development signed a national rural e-commerce poverty alleviation strategic cooperation framework agreement in Beijing. The two sides will cooperate in four areas: the “E-commerce Poverty Alleviation Double Hundred Demonstration Action”, the e-commerce poverty alleviation O2O exhibition and sales zone, the “10·17” poverty alleviation shopping festival, and rural e-commerce talent training. This move will benefit 104 impoverished districts and counties nationwide and more than 2.34 million rural poor households.

Not only Zhang Jindong's Suning Commerce Group, but also Ma Yun's Alibaba system and Wang Jianlin's Wanda Group - these giant e-commerce enterprises are also intensifying their deployments and rapidly assembling toward rural areas. As first- and second-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen approach saturation, the vast and yet-to-be-cultivated rural market is becoming a hot investment land for e-commerce and a new growth point for Internet companies.

The agreement reached between Suning Commerce Group and the State Council Leading Group Office of Poverty Alleviation and Development shows that the “E-commerce Poverty Alleviation Double Hundred Demonstration Action” jointly promoted by both sides will, in the next three years, have Suning build 100 stores in 100 impoverished counties suitable for developing rural e-commerce, including Suning Tesco direct-sale stores and service stations; and correspondingly launch 100 “Local Specialty Pavilions” on Suning Tesco to promote agricultural and sideline products, ethnic handicrafts, tourism products and more to go online and enter cities.

Suning Vice President Sun Weimin said that the advantage of 1,600 offline stores will be used to deeply advance O2O dual-line poverty alleviation in core urban commercial districts, building e-commerce poverty alleviation O2O experience exhibition zones in some Suning stores to centrally display high-quality specialty agricultural and sideline products and tourism resources from impoverished areas. At present, there are plans to open a zone at the Beijing Lianxiangqiao cloud store to display agricultural and sideline products from Siyang, Suqian, Jiangsu; Yinchuan, Ningxia; Honghe, Yunnan and other places.

According to the State Council Leading Group Office of Poverty Alleviation and Development, developing rural e-commerce has become one of the key contents of the country's 12 poverty alleviation projects, and the current development of e-commerce in impoverished areas nationwide is good. Taking Gansu as an example, all 9 counties and cities in Longnan have been listed as national e-commerce demonstration counties. Last year, online sales revenue reached nearly 1 billion yuan, and no “difficulty of selling” phenomenon occurred.

Internet + Agricultural and Sideline Products: Reconstructing the Rural Commercial Ecosystem

Poverty is a “syndrome”, but one of its root causes is still poor information flow. Qu Tianjun, inspector of the Department of International Cooperation and Social Poverty Alleviation of the State Council Leading Group Office of Poverty Alleviation and Development, said that the biggest problem in impoverished areas is that high-quality agricultural and sideline products cannot be sold, cannot fetch a good price, and even more so cannot build a brand.

When the Internet meets agricultural and sideline products, the civilized breeze of modern commerce quickly “ripples a pool of spring water” across the vast rural land: the Internet, big data, crowdfunding, cold chain, logistics…… E-commerce enterprises carry these most advanced elements of commercial civilization and begin to embrace the “local” that symbolizes ecological environmental protection and the scarce and pure “special”. The rural commercial ecosystem thus begins an unprecedented reconstruction and nirvana.

The strategic agreement reached between Suning and the State Council Leading Group Office of Poverty Alleviation and Development states that Suning will, through precise big data analysis, advanced Internet technology, its own logistics and distribution system, and more, help impoverished areas with distinctive characteristics carry out “targeted poverty alleviation”, exploring an O2O dual-line poverty alleviation model with “farmers + enterprises + bases + e-commerce”.

The approach to poverty alleviation has also shifted from the previous “blood-transfusion poverty alleviation” to “blood-making poverty alleviation”, focusing on cultivating e-commerce talent for impoverished areas. Suning plans to assist impoverished county governments in strengthening practical e-commerce training and cultivating more rural e-commerce talent teams, with an estimated cumulative training of no fewer than 10,000 person-times over 3 years.

Suning has already tested “blood-making poverty alleviation” in multiple provinces including Jiangsu, Yunnan and Hunan, applying retail CPU capabilities to poverty alleviation projects. Specialty agricultural and sideline products such as Yunnan red rice and Xiangxi cured meat have already been marketed nationwide. This year, in the “Chinese Specialty Pavilion” zone of the Suning Tesco supermarket channel, the “Honghe Pavilion” went online, and the price of Yunnan red rice broke through 20 yuan/jin.

The cured meat of Xiangxi Tujia and Miao Autonomous Prefecture in Hunan has also been brought to the dinner tables of people across the country in this way. The “Xiangxi Pavilion” launched in the “Chinese Specialty Pavilion” zone of Suning Tesco conducts big data analysis on consumer behavior for similar products in the market to help the local area discover selling points for agricultural products. At the same time, it helps local farmers create crowdfunding activities for agricultural products, solving product sales problems in advance through presale formats.

Barbaric Growth Cannot Overdraw “Local” and “Special”

The rural market, especially the yet-to-be-developed commodity “virgin land” in impoverished areas, is the last piece of cake in the minds of many Internet companies.

“Internet + Local Specialties” has momentarily become a hot item online: WeChat Moments, client apps, Weibo, WeChat, QQ, Taobao - wherever the Internet can reach, there are almost voices selling local specialties.

Whose radishes rotted in the field, whose oranges hung on the trees with no one to harvest them - as long as it gets attached to some influential public account, netizens will quickly extend a helping hand. You also sell authentic Dangshan pears, and I also sell authentic Shatian pomelos. For a time, the Internet seemed to have become an omnipotent sales expert.

This barbarically growing “Internet + Local Specialties” model, while successfully promoting agricultural products, has also become a means for some lawbreakers to cheat and swindle. Industry insiders believe that some people are precisely using the virtual nature of the Internet to falsify product descriptions and photos, which not only harms consumers' interests but also overdraws the credit of the rural market, urgently requiring measures for regulation.

Bringing in e-commerce companies with strength and good reputation, such as Suning Commerce Group, to enter rural areas and replace the “Internet +” model where every household smokes and every village lights fires, is an effective means to overcome the drawbacks of e-commerce's virtual nature.

Hong Tianyun, deputy director of the State Council Leading Group Office of Poverty Alleviation and Development, believes that the Internet is like a highway, and some individual e-commerce sellers are like untrained drivers who do not obey traffic rules, bringing chaos to the high-speed circulation of rural goods. Bringing in powerful large e-commerce companies is precisely to let farmers in impoverished areas know that highways cannot be crossed randomly by people and livestock alike.

Hong Tianyun said that if Taobao stores are opened in impoverished villages and the game rules and talent training are not in place, it will both ruin local specialties and ruin the Internet. Local specialties often have small scale, many non-standard products and fresh goods, and face many difficulties in logistics, transportation and market prices. Large e-commerce companies can effectively organize farmers and, through standardization and modern logistics, quickly and efficiently connect with the national market.