E-Commerce and Other Business

For our e-commerce and other business, we mainly focus on the character IP product e-commerce market, one of the subsegments of the broader IP product e-commerce market, and offer our B.Duck Family Characters-featured products primarily through third-party e-commerce platforms in China Hong Kong and the PRC, such as Tmall, JD.com, VIP.com and HKTVmall, etc, to satisfy our customers’ needs online and throughout the years.

We engage various domestic OEM suppliers to outsource the production of our products and procure products from the licensees of our merchandise licensing service.

In 2015, we first started operating our flagship store on Tmall, which has become one of our key channels to attract new fans. Following our success in the opening of such flagship store, we subsequently expanded onto other e-commerce platforms and reached a total of 11 platforms, such as JD.com, VIP.com and HKTVmall, to offer our products and allow customers to pay online with our products directly shipped to the customers. We have sold more than 7,400 SKUs through e-commerce platforms under our e-commerce and other business.

In 2019, we established our first in-house live streaming sales team which was primarily responsible for planning of our live streaming marketing strategies, digital marketing content creation and engaging and collaboration with different KOLs. Since then, we have commenced our live streaming sales campaign on various e-commerce platforms.

Online shopping has become increasing prevalent in China and China Hong Kong. We believe that the use of third party e-commerce platforms enables us to extend our geographical coverage and customer reach without having to physically establish a large number of retail stores. Our Directors believe that this arrangement will accelerate the growth of the popularity of our character IPs and allow us to reach our customers in regions where we do not have a physical presence.