Chinese membership-based social e-commerce platform Yunji (NASDAQ:YJ) isn’t extremely well known to the U.S. trading community. Don’t be surprised, though, if you start hearing about YJ stock as a red-hot asset in the near future.
In the 21st century, e-commerce companies must adapt to consumer preferences. Online shoppers don’t just want to browse and buy items. They want to feel like they’re part of a community.
In other words, online shopping is increasingly being seen as a social experience in today’s world. You could call this phenomenon “social e-commerce”: savvy companies using social media to increase engagement, brand loyalty and, ultimately, repeat purchases.
Yunji has been in existence since 2015. Yet, 2021 might be the year that the company and YJ stock make their mark among U.S. traders.
YJ Stock at a Glance
As we’ll see, YJ stock provides a textbook example of how patient investors can reap the greatest rewards.
Throughout October and most of November, YJ stock didn’t provide much in the way of excitement. The share price mostly stayed in a tight range between $1.75 and $1.90 during that time period.
Undoubtedly, some shareholders lost patience and turned their attention elsewhere. That’s a shame, as a massive run-up in the YJ stock price was about to take place.
In late November, YJ stock rocketed up to the $6 level in a matter of days. It just goes to show that the stock market can offer the biggest gains to those who are willing to “be right and sit tight.”
The YJ share price did pull back below $3 in early December, but that’s not necessarily a bad thing. If you’ve been sitting on the sidelines, the more favorable price point could provide an entry opportunity for YJ stock.
A Major Cooperation
Yunji’s unique angle among e-commerce companies is its social aspect. In furtherance of this, the company recently formed a cooperative agreement with Douyin.
A popular livestreaming and social media platform, Douyin is part of ByteDance. You may know ByteDance as the parent company of TikTok, which is essentially the international version of Douyin.
Granted, there was political tension between the White House and TikTok, but that appears to be mostly resolved now. Moreover, most believe that there might not be as much tension between the U.S. government and TikTok going forward, as the new administration takes office in January.
Either way, according to Yunji’s corrected press release, the collaboration with Douyin should be a value-added development:
“… through attractive live streaming events on Douyin’s E-Commerce Business, the Company will … be able to expand the influence of the high-quality private label and joint-venture brands in its network to external platforms as well as provide a broader consumer base range with access to its premium products.”
Going Live
In order to demonstrate that its partnership with Douyin will reap benefits for the stakeholders, Yunji had a livestream with Douyin on Sept. 25.
It’s fair to say that this event was a blockbuster success. If you need proof of this, note that the livestream event generated 87.5 million RMB in gross merchandise value.
Furthermore, the event had an eye-popping 10.7 million views. Viewers even got to see the founder and CEO of Yunji, Shanglue Xiao, make a guest appearance.
During the livestream, Xiao introduced more than 40 products offered on Yunji. Clearly, the company’s CEO is not afraid to hustle his platform’s wares. That’s what I would call an ambitious company, and a hugely successful livestream.
The Takeaway
The price action in YJ stock shows that it is capable of powerful spikes. However, the greatest rewards will only go to patient investors. For this reason, Yunji stock currently has a “C” rating in my Portfolio Grader.
Still, shareholders might not have to wait too long to see benefits, as the massive success of Yunji’s first livestream demonstrates the power of modern, socially integrated commerce.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system — with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation.
