1. January 2013 An Introduction to Yihaodian

2. Ecommerce in China Yihaodian establishes its presence in the market Yihaodian’s core competitive advantages Yihaodian’s plan for continued growth Today’s Discussion 1 2 3 4

3. 1 2 3 4 Ecommerce in China Yihaodian establishes its presence in the market Yihaodian’s core competitive advantages Yihaodian’s plan for continued growth

4. 3 诚信顾客执行创新 Source: China online shopping industry annual monitoring report 2011-2012 and China Internet Network Information Center 2012 Chinese internet use is growing rapidly with usage predicted to exceed 600 million by 2015 Number of internet users in China (unit in millions)

5. 4 诚信顾客执行创新 Source: China online shopping industry annual monitoring report 2011-2012 and China Internet Network Information Center 2012 In 2011, 36% of online users were also shopping. That penetration rate is expected to reach 60% by 2015. Number of online shoppers in China (unit in millions)

6. 5 诚信顾客执行创新 Source: China online shopping industry annual monitoring report 2011-2012 and China Internet Network Information Center 2012 The ecommerce market is predicted to grow 100 times by 2015 and the B2C market will eventually become the primary market. Ecommerce Revenues in China (unit in millions) B2C versus C2C Ecommerce Revenues in China

7. Today’s Discussion 1 2 3 4 Ecommerce in China Yihaodian establishes its presence in the market Yihaodian’s core competitive advantages Yihaodian’s plan for continued growth

8. 7 诚信顾客执行创新 YHD was founded in July 2008 with the aim to create an online supermarket that provides customers with a variety of quality products at low prices and an excellent customer experience. It has currently sells hundreds of thousands of products, covering eight product lines including Food & Beverage, Imported Food, Personal care, Mother & Baby, Cleaning products, Digital electronics, Home goods, Clothing and Nutrition & Health Care. It has over 30 millions registered users, and was awarded the fastest growing integrated e- commerce company in China. Yihaodian’s history

9. 8 诚信执行创新 1 号店大事记 Yihaodian was founded in July 2008, creating the first Chinese online supermarket. In July 2009, Yihaodian reached its 1 st Anniversary with 1,000 orders in a single day. In 2010, Yihaodian ran its 1 st vendor conference and reached 48M RMB in sales. In 2011, Yihaodian established a strategic partnership with Walmart, the biggest retailer in the world. In 2012, Yihaodian became one of the largest e-commerce companies in Shanghai and shifted its attention toward nationwide growth. In 2013 Yihaodian focuses on continued innovation and national growth.

10. 99 执行创新 Yihaodian has grown quickly in its four years of existence 诚信顾客 2,740,000

11. Every month, 15M members view YHD website 5 million unique visitors a day Everyday, more and more members join Yihaodian 30 million registered users alexa 月平均排名 100 1.5 亿浏览会员 人均页面浏览 12.2 3000 万 注册会员 A quick glance at Yihaodian’s key metrics 执行创新诚信顾客 10 Pine, this number relative the daily unique visitors seems strange ↓

12. 诚信顾客执行创新 We work hard to meet customer demands through every aspect of our business Low prices 3%-5% lower than traditional retailers Price bargaining power Product variety Food, drink, clothing, personal care, electronics Fast delivery Three delivery times per day Including night delivery Phone numbers of delivery per sonnel provided to custo mer Easy shopping Guarantee quality Cash on delivery Good customer service YHD, meets customers’ demand 11

13. 12 Product development Marketing Distribution SalesServices Track customer buying behavior and preferences Conduct user trials and analyze feedback Targeted segmentation Remarketing Purchase recommendations Joint promotions Online brand equity development Simplify distribution network Shared warehouse and delivery network Better suited e- commerce packaging Up-selling Cross-selling SKU diversification and customized selection New customer acquisition strategies Joint sales campaigns Customer insight gathering Post sales surveys Joint effort to reduce product defects Yihaodian works partners with suppliers to drive sales 诚信顾客执行创新

14. Today’s Discussion 1 2 3 4 Ecommerce in China Yihaodian establishes its presence in the market Yihaodian’s core competitive advantages Yihaodian’s plan for continued growth

15. 14 诚信顾客执行创新 Receiving Parcels Customer Service Customer experience Shopping Vender management Purchase management Product management Price management Warehouse management Website systemCustomer service system Supplier certification Quality testing Business review Expense settlement Automatic stock replenishment Automatic ordering End-to-end inventory management End-to-end category management Expiration date management Pricing intelligence management Price recognition management Price comparison management RF operation Picking route optimization Shelf placement strategy Popular product placement opimization PC, Mobile APP technology support Intelligent search Customized homepage Personalized recommendation Real-time monitoring of all customer service cues Customer complaint management Our technology system consists of over 124 software patents and more than 1000 IT professionals on staff

16. 15 诚信顾客执行创新 Typical Yihaodian User Primarily white collar High income High consumption 19-40 years old Primarily white collar High income High consumption 19-40 years old Source: YHD internal survey and public industry data 2012 Yihaodian’s customers

17. 武汉库房 成都库房 北京 成都 武汉 沈阳 西安 宁波 深圳 南京 4 杭州 重庆重庆 天津 济南 扬州 温州 金华 芜湖 合肥 镇江 常州 无锡 苏州 昆山 南通 石家庄 福州 厦门 惠州 珠海 中山 佛山 东莞 江门 二级配送中 心 自配送站点 广州 上海 半日达范围 次日达范围 无锡 3 Nationwide coverage (except Hong Kong, Macau, Taiwan) 70% self-distributed. More than 200 distribution centers in 40 cities Next day delivery, half-day delivery and 3x per day delivery available SBY (Service By YHD) providing, provides e- commerce solutions for traditional companies. 诚信顾客执行创新 16 Yihaodian’s supply chain network

18. 17 诚信顾客执行创新 How long does it take for an Yihaodian picker to pick an average order (16.7 SKUs) from our 300,000+ SKUs housed in 30,000 square feet of warehouse space? <80 seconds The power of Yihaodian’s supply chain

19. 18 诚信顾客执行创新 YHD APPQR code shoppingUnlimited YHD Yihaodian is an innovator in the wireless market

20. Today’s Discussion 1 2 3 4 Ecommerce in China Yihaodian establishes its presence in the market Yihaodian’s core competitive advantages Yihaodian’s plan for continued growth

21. 20 诚信顾客执行创新 Excellent customer experience Diversified categories Reliable quality Reasonable price Simple and compelling promotions Simple usability Logical classification Quick search Friendly interface Multiple payment methods Accurate order preparation, Secure packing Fast delivery Good service Member management Precision marketing Customized service YHD, aims to TOP1 customer service in the industry

22. 21 诚信顾客执行创新 Source: HYNA Consulting Ltd. 2012.12 85% Satisfied 90% Satisfied Unsatisfied 7.5% Neutral 2.5% Unsatisfied 11.6% Neutral 3.4% Average 2012 customer experience score Average 2011 customer experience scores Yihaodian focuses on constant improvement to our customer experience

23. 22 诚信顾客执行创新 Bachelor degree of Space Physics from Wuhan University, Masters degree of Physics from Cornell University, PHD of Science of Supply Chain Management from the Wharton School of the University of Pennsylvania. Entrepreneurial talent winner from the National Thousand Talents Program. Vice President of Dell global procurement and Vice President of global supply chain at Amazon. Tenured Professor in the School of Management at the University of Texas, Mccombs Business School. Co-founder of Yihaodian with partner Liu Junling in 2008. President : Dr. Yu Gang CEO: Liu Junling Masters degree in International Business from Flinders University in Australia Entrepreneurial talent winners in National Thousand Talents Program. Former Vice Global President at Dell, and President of Greater China and Hong Kong, Former General Manager of Avaya China, tripling Avaya’s performance in China in three years. Co-founder of Yihaodian with partner Yu Gang in 2008. Yihaodian’s founders

24. www.yihaodian.com