Alicia Yap: or share a little bit of competitive landscape on JDDJ business compared to H1. And then would there be any potential conflicts with our partnership on going on their local service versus our JDDJ business in terms of the consumer demands on the grocery category or the food category? And then second question is can management share with us what is the latest consumption trends that you are seeing in terms of the consumption willingness on the bigger ticket items such as the electronics and appliances and also the supermarket category post the Chinese New Year.
Jeff Huijian He: Thank you for your question. To answer your first question, we remain convinced of the enormous market opportunity as OGIO further penetrates the entire retail sector given the low penetration rate we are seeing now. The industry is large enough to accommodate more than 1 player and all enjoy healthy development. Specifically, regarding Masonite shopping, they and thus have differentiated advantages and third parties will leverage the distinctive strengths to cater to diversified consumer needs. Now I will share with you my thoughts on our advantages on both the supply and demand side. On the supply front, our main edge lies in our positioning as a pure play platform and our digitalization capabilities, which has enabled us to work more extensively with leading chain merchants and brands, making us more competitive and variety, quality and pricing product supplies.
Jeff Huijian He: Now let me explain our adjectives in more details. As a pure marketplace, we never engage in retailing ourselves. That’s why our retailers are more willing to cooperate with us. For instance, we’ve teamed up with 90 out of the top 100 supermarket chains in China, and we are making progress in cooperating with leading local champions. Now in contrast, our has direct sales business which competes directly with retailers. So retailers have concerns and reservations about launching their platform. In the right case that leading retailers agreed to work with the other platform. Only a number of stores have actually launched. Our last — the other company goes through a fundamental strategic shift. It cannot transform into a pure marketplace as we are.
That’s why we are confident in maintaining this advantage and the long run. Moving on to our capabilities and digitally empowering our retailers. After years of investments in technology and serving leading retailers, we’ve accumulated as in class know-how and several well-recognized digital products and solutions such as Haibo and Dada Picking. These products were crucial in helping us maintaining a solid relation with our merchant partners. Not platform and auto platform not only provides a delivery network to retailers, but also needs to digitally empower them to improve operating efficiency. And in terms of potential conflict, as you predict, with So in the main efforts right now are centered around the food delivery business. So there’s not been much strategic conflict with our on-demand retail business.
To answer your second question on macro. The economic cycle and the changes in consumer confidence affects the entire retail industry and in — on an on-demand retail platform, we are another exception. On the other hand, on-demand retail is still in the early stage with only single-digit penetration rate in the local retail sector. So we remain confident in the long-term potential of the industry. So in terms of outlook, we expect faster economic and consumption growth this year versus last year, but there is still some uncertainty in the pace of recovery. So we had higher expectations for the second half than in the first half. . Since the — since the pandemic control measures were lifted towards the end of 2022, there were massive infections in multiple regions in December and January, affecting the supply chain and the consumer confidence.
Now the shocks from corporate upgrades have gradually subsided Depot’s daily lives and mobility has normalized, and the overall business environment is improving. So we are expecting better economic and consumption growth this year. That said, we are seeing some uncertainties in the pace of recovery, especially in the first half, given that the pro consumption policies take time to bear fruit and the reopenings boost to your consumer income and confidence may not manifest itself immediately. So we are seeing — we’re expecting modest growth in consumption in the first half and a reacceleration in the second half as consumer confidence gradually recovers. In the long run, thanks to the rapid rise of ad penetration in retail, the confidence in achieving growth that significantly outpaces the e-commerce sector and other players.
Operator: Your next question comes from Andre Chang with JPMorgan.
