Chinese E-commerce Giant 360Buy to Expand into Games

China’s B2C e-commerce specialist 360Buy is stepping onto new ground. According to Yicai, the online shopping giant will be launching its very own online games. The new expansion is still undergoing production and it will be tested internally starting on the 20th of this month.

This project has been pretty much kept under wraps and ostensibly 360Buy wants to keep it quiet for the time being, at least until their games are ready for launch. The first launch will see about four to six games on its platform. However, it remains unclear the type of games that 360Buy will be experimenting with (i.e. mobile, browser-based, MMOs, etc).

As reported in the article, a 360Buy representative revealed that this new project has been in the works for three to four months. The company, China’s second-biggest B2C shopping site, will outsource the games to third-party developers and they will play more of a “platform” role in this project.

This is an interesting move for 360Buy as engaging games will generate a new revenue stream for the company. More importantly, it will also improve the current system of payment collection. According to 360Buy, 70 percent of its payment comes only after users have received goods. The issue with “after-collection-payment” system is that it requires high capital as the company needs cash liquidity for logistics, delivery, and more problems when users reject the items for whatever reasons. It’s part of the reason that 360Buy tries to pay for the stock it buys as late as possible – a source of tension between the e-tailer and some of its suppliers.

However, games by nature are not items you pay for after consumption. Most of the time, payment is made when you purchase the game. As such, 360Buy’s cash-flow might improve.

As e-commerce and games usually attracts different crowd of users, 360Buy will be hoping to increase its user-base. I would reckon that this is a good move for 360Buy, especially after a bloody price-war in which I’m still very unclear who – if anyone – really won.

[Source: Yicai, Image]