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Ann Cao

Alibaba Group Holding has vowed to protect merchants on its Chinese shopping sites from excessive competition, as the e-commerce giant begins its annual Singles’ Day mega sales following warnings by Beijing to steer clear of unsustainable price wars.
Early efforts to improve the business environment for sellers on Taobao and Tmall, the country’s largest online marketplaces, have begun to bear fruit, and merchants can expect more beneficial measures during the major shopping festival, according to Alibaba’s domestic e-commerce unit.
“Our thinking is to eventually remove merchants from ‘ineffective involution’, and push them to provide high-quality services,” Zong Bu, the executive who oversees merchant service experience at Taobao and Tmall Group (TTG), said on Wednesday at a media event in Hangzhou, headquarters of Post owner Alibaba.
The word involution, which entered the Chinese cultural lexicon in recent years, describes shrinking opportunities in a highly competitive environment.

“We hope that Singles’ Day is not only a joyful shopping festival, but also a fair and dynamic e-commerce ecosystem [that] brings sustainable growth to merchants. We hope that the entire e-commerce industry can return to the right track of development,” Zong said.
TTG has introduced a slew of measures over the past months to help merchants on its platforms.
They include loosening the controversial “refund without return” policy, which had allowed customers to keep both their money and bought items at the expense of merchants. The practice has gained popularity thanks to promotions by Pinduoduo, a competing marketplace run by PDD Holdings.
Alibaba is seeking to strike a balance between protecting consumer rights and ensuring the livelihoods of tens of millions of sellers operating on its platforms amid a heated price war in the Chinese e-commerce sector.
In July, China’s cabinet, the Politburo, released a statement that included a line that called out unhealthy competition and involution. State media later indicated that the message was meant to be a criticism targeting e-commerce platforms.
Since then, platform operators have modified their operations to prevent a race to the bottom in price and quality. Pinduoduo, for example, started ejecting sellers of counterfeit products last month.

Alibaba’s Zong said the core of TTG’s strategy is to take a step back from managing its sellers and give them more autonomy in daily operations.
“Ninety-five per cent of the services offered on Taobao and Tmall are implemented by merchants,” said Zong. “Our merchants determine the top level of services we can offer across our platforms.”
In addition to rejecting an average of more than 400,000 refund requests a day from shoppers in the past two months, TTG has also cut down the logistics cost for returns shouldered by merchants by about 30 per cent if they use the company’s recently launched return service Tuihuobao, according to Zong.
Alibaba, along with rivals JD.com and Pinduoduo, kicked off their respective Singles’ Day campaigns on Monday. The annual online retail extravaganza, started by Alibaba in 2009 as a 24-hour event on November 11, has since stretched into weeks, with major e-commerce platforms jostling for consumers with steep discounts.
This year’s sales will be closely watched by investors as a proxy for tracking consumer spending, after the Chinese government rolled out a barrage of stimulus measures to boost the economy late last month.
Alibaba has earmarked at least 40 billion yuan (US$5.7 billion) worth of resources to support merchants and lure more consumers to Taobao and Tmall during the event. That includes 10 billion yuan to boost cross-platform traffic and 3 billion yuan to subsidise the marketing costs of sellers. Around 300,000 brands and a multitude of small and medium-sized merchants are taking part, according to TTG.


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The e-commerce giant aims to root out ‘ineffective involution’ after Beijing warned against a race to the bottom in price and quality


The e-commerce giant aims to root out ‘ineffective involution’ after Beijing warned against a race to the bottom in price and quality.


Alibaba’s new Singles’ Day focus: protecting sellers from price wars

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}The e-commerce giant aims to root out ‘ineffective involution’ after Beijing warned against a race to the bottom in price and quality

The e-commerce giant aims to root out ‘ineffective involution’ after Beijing warned against a race to the bottom in price and quality