Joy Spreader’s Direct-to-customer and Cost-per-sale Models Pave the Way of Its International Business Exploration
Joy Spreader Group Inc., proves its direct-to-customer (DTC) and cost-per sale models (CPS) with outstanding financial performance in H1 2021. The Group achieved revenue of HK$624 million (approx. US$79.8 million), an increase of 62.37 per cent from the same period of the prior year. The e-commerce products marketing business, the major growth driver during the reporting period, posted a rise of 285.24 per cent in revenue, surging to HK$129 million (approx. US$16.5 million). The GMV of e-commerce products rose to HK$647 million (approx. US$82.8 million), up 264.08 per cent.
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Today, “e-commerce” is no longer a new word. Models such as live streaming e-commerce and short-form video (SFV)-based e-commerce have become widely popular among consumers, and have become one of the key ways that products and services are purchased. Interest-based recommendation engines based on data and algorithms are also widely used in China. E-commerce platforms with global reach, with the immensely popular TikTok serving as an example, are in the initial stages of monetization and on the verge of offering huge growth potential thanks to changing customer behavior. TikTok has accumulated a huge number of users and a massive amount of online content.
As the e-commerce sector continues to mature and Joy Spreader’s short-form video (SFV)-based e-commerce marketing business continues to grow, foreign markets have become the next target. The Group has started to build an overseas e-commerce business system based on its DTC and CPS models in response to the characteristics of mobile new media operators and the market environment outside of China.
On the one hand, the Group has built a new technology model and service system to expand its interest-based e-commerce marketing business to overseas platforms with a large number of active users, starting with TikTok. On the other, Joy Spreader plans to build a business closed-loop for different regional markets by improving the logistics around the supply of goods, as well as the quality of the new media content, the traffic, the data analysis and the matchmaking technology, with the goal of applying the “consumption matchmaking” marketing model. Based on data algorithms and interest-based recommendations, the model which has already been proved in China will adopt and adapt to its international markets. The DTC and CPS components of the performance-based marketing models advocated by Joy Spreader are expected to work just as well in overseas markets and meet the expectations of these new audiences.
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In order to accelerate the growth of the e-commerce marketing business beyond the borders of its home market, Joy Spreader is actively building its competitive edge in big data around algorithm modeling. In the first half of 2021, the Group invested nearly HK$30 million (approx. US$3.8 million) in R&D, a significant increase of 712.5% in spend when compared with the first half of 2020. The Group has built 169 data models based on different product categories. A continued increase in the amount of accumulated data in tandem with enhanced algorithm capabilities have laid a solid foundation for the company to improve the performance of its marketing business, to further expand its customer base as well as the number and variety of new media-based locations for product placement.
Joy Spreader has established Hainan Joy Spreader Interactive International Technology Co., Ltd, an e-commerce marketing platform for markets outside of China and a key business line of the Group. To this end, the Group plans to launch the e-commerce marketing service first in Southeast Asia, followed by the anticipated exploration of the service into other countries and regions worldwide.
