Raising the Bar in China's Online Beauty Industry

BEIJING, July 1, 2014 /PRNewswire/ -- Jumei International Holding Limited (NYSE: JMEI) ("Jumei" or the "Company"), China's leading online retailer of beauty products, is setting new benchmarks in product quality control in China's online beauty industry.

Beginning in July 2014, Jumei will start publishing monthly product audits of supplier and third-party merchants on its website and significantly expanding the sample size of spectrum analysis testing.

The new measures are aimed at reinforcing the Company's reputation for product quality and reliability with Chinese consumers. They improve upon the previous system, which was based on monthly random checks of 12% of third party beauty product merchants using outside testing laboratories. Using this system, Jumei has been able to identify merchants that were unable to pass quality checks and actively terminate their contracts before any products were shipped to customers.

Jumei started expanding the scope of random sample testing in June 2014, when the Company's Beijing consulting laboratory increased the sample size for testing from 12% of third party merchants to more than 67%, covering 17% of beauty product marketplace SKUs. The June tests discovered no instances of counterfeiting or other product discrepancies.

Vertical integration of quality control is one of the many measures that Jumei has adopted to build consumer trust and confidence.

Quality control measures

Jumei has worked to raise product quality standards not only for its own business, but also for the entire Chinese beauty products industry.

In July 2013, Jumei helped establish the Authentic Beauty Product Alliance (ABPA), the first nationwide alliance against fake and counterfeit products in the beauty industry. China's online retail industry has an unfortunate history of lax controls, which have undermined consumer confidence. ABPA, which includes China Quality Long March, one of the most influential national organizations focusing on product quality, allows customers to trace products to their source on the ABPA website and on websites of participating brands, using tracking codes printed on ABPA stickers. As of March 31, 2014, ABPA had 74 members, and accounted for 64% of Jumei's merchandise sales GMV.

The industry campaign reflects concerns on the part of the Chinese government and the public with consumer protection. Although Jumei has passed all government tests for safety, quality, and authenticity, it is committed to taking such testing one step further, by making sure its own testing and standards strive for zero tolerance.

Other anti-counterfeiting and quality assurance strategies include: 

• Jumei controls the entire value chain, from product sourcing to final sales, for 100% of its direct merchandise sales business, to ensure that no fake products are sold. Every product sold can be traced back to the brand via sales receipts.
• Jumei does business only with quality third party merchants.
• All exterior packaging and expiration dates of beauty products are checked upon arrival in Jumei's warehouse and prior to shipping to customers.
• Jumei allows its customers to return beauty products within 30 days of purchase, even after the customer has opened them.
• Insurance is in place for products sold on Jumei's online platform.
• Jumei offers consumer education on methods to distinguish fake from genuine beauty products. It posts web videos on Jumei.com, and encourages user-generated content to help consumers identify real from fake products.

The Company will hold a global conference call to discuss its new benchmarks in the anti-counterfeiting campaign. This conference call will be held on Wednesday, July 2, 2014 at 8:00 a.m. U.S. Eastern Time, which is 8:00 p.m. Beijing Time on the same day.

The dial-in details for the live conference call are:

A telephone replay of the call will be available after the conclusion of the conference call:

The live webcast will be available on the Investor Relations section of Jumei's website at http://jumei.investorroom.com/.

About Jumei International Holding Limited

Jumei (NYSE: JMEI) is China's No. 1 online retailer of beauty products as measured by gross merchandise volume, with a market share of 22.1% in 2013, according to a commissioned research report by Frost & Sullivan. Jumei's internet platform is a trusted destination for consumers to discover and purchase branded beauty products and fashionable apparel and other lifestyle products through the Company's jumei.com website and mobile application. Approximately 49% of Jumei's gross merchandise volume was generated through its mobile application in the first quarter of 2014. Leveraging its deep understanding of customer needs and preferences, as well as its strong merchandizing capabilities, Jumei has adopted multiple effective sales formats to encourage product purchases on its platform, including curated sales, online shopping mall and flash sales.

For investor and media inquiries, please contact:

Jumei International Holding Limited
Mr. Sterling Song
Investor Relations Director
Phone: +86-10-5676-6983
[email protected]

Christensen
In China
Mr. Christian Arnell
Phone: +86-10- 5900-1548
E-mail: [email protected]

In US
Ms. Linda Bergkamp
Phone: +1-480-614-3004
Email: [email protected]

SOURCE Jumei International Holding limited