Pinduoduo fully supports automatic price routing

E-commerce newspaper Pro

2024-06-25 14:12Posted on the official account of Guangdong E-commerce News

Pinduoduo's "automatic price calling" covers all products

In the intensifying e-commerce price war, Pinduoduo once again made waves and dropped a bombshell.

Recently, Pinduoduo has made major adjustments to its "automatic price following" service agreement, expanding the scope of applicable products. The new agreement, which is expected to take effect on June 28, marks another bold attempt at Pinduoduo's pricing strategy.

According to the new agreement, once the merchant activates this service, the platform will have the right to adjust the price of all products (including existing inventory and new products in the future) within a specific range based on factors such as the sales situation of the whole network, marketing activities, etc., without additional confirmation from the merchant.

At the heart of this "automatic price mapping" service is that the merchant authorization platform uses intelligent algorithms and data analysis to automatically modify the price of goods within a specific cycle to better adapt to market changes and consumer needs. At the same time, the platform will also assist merchants to adjust their pricing strategies and sign them up for suitable marketing activities to further improve sales results.

Source: Pinduoduo Merchant Rules Center

The implementation of this new strategy has undoubtedly given the Pinduoduo platform greater price control. The system's algorithm can not only automatically modify the price of the product according to market conditions, but also make decisions to participate in marketing activities "on behalf of" the merchant without the merchant's knowledge.

However, the implementation of this new strategy has also aroused widespread attention and discussion in the industry. Some merchants are worried that the automatic price matching system may exacerbate price wars, further compress profit margins, and even induce unfair price competition. Consumers are concerned that frequent price fluctuations will affect the shopping experience and trust.

There are also some netizens jokingly saying that JD.com makes money on both merchants and consumers, Taobao mainly earns consumers' money, and Pinduoduo mainly makes merchants' money.

Source: IT House

In this regard, Pinduoduo has said that the automatic price matching system is not a simple price war tool, but aims to help merchants formulate more reasonable price strategies and enhance competitiveness through intelligent algorithms and data analysis.

At the same time, the platform will strengthen the supervision of merchants, prevent the occurrence of unfair price competition, and continue to optimize the shopping experience and trust to ensure the stability and rationality of commodity prices.

However, since the launch of the system, many problems have gradually emerged, such as pop-up windows that are difficult to close, frequent pop-ups, and irreversible changes caused by misoperation, etc., which have brought a lot of trouble to merchants.

Source: Little Red Book

In addition to Pinduoduo, other e-commerce platforms are also trying similar strategies. For example, Douyin e-commerce is testing an "automatic price change" feature on a small scale, which allows merchants to entrust the platform to change prices based on market conditions and the platform's suggested price. However, during the beta test, many merchants gave negative feedback.

With the gradual implementation and implementation of these new strategies, a new low-price tug-of-war has gradually kicked off.

Who is the winner in the bottomless "price war"?

In recent years, the e-commerce industry seems to have fallen into a never-ending "price war" vortex.

From last year's Double 11 shopping carnival to this year's 618 mid-year promotion, major e-commerce platforms have shown promotional methods such as discounts and full reductions, trying to seize the opportunity in this battlefield filled with gunpowder.

However, in this seemingly lively "price war", we can't help but ask: who will be the ultimate winner?

Not long ago, on the eve of 618, the publishing industry suddenly set off an uproar. 10 publishing houses in Beijing and 46 publishing units in Shanghai, represented by the Shanghai Publishing Management Association, jointly issued a statement, making it clear that they would not participate in JD.com's book promotion with a discount of as low as 2-3% off, and refused to bear any rebate fees incurred during the event.

Some publishers jointly issued a notification letter

Shen Haobo, the founder, director and CEO of Motie Group, publicly stood up and published a long article to boycott JD.com. He called on peers not to blindly follow the price, but to jointly resist this bottomless price competition.

Some publishers jointly issued a notification letter

This move undoubtedly pushed the controversy of the "price war" to a climax. This incident not only reveals the tension between publishers and e-commerce platforms, but also shows us the deeper problems that can be raised behind the price war.

In fact, price wars are often a double-edged sword for all parties involved.

In the short term, it can indeed stimulate consumers' desire to buy and increase sales. But in the long run, excessive price competition can lead merchants to sacrifice product quality and service levels in order to reduce costs.

When merchants continue to compress profit margins in the price war, and even sell goods at prices below cost, their survival pressure will also increase. In this case, the quality of the goods and the level of service are likely to suffer.

Then, when consumers buy these low-priced goods, they often need to spend more time, energy and money to deal with possible quality problems and after-sales problems, so as to gradually lose their enthusiasm and confidence in shopping on e-commerce platforms.

Merchants can't sell goods, and consumers can't buy suitable goods. For both sides, the gains outweigh the losses.

In addition, for e-commerce platforms, over-reliance on price wars to attract consumers is not a long-term solution. Once it encounters a collective boycott from merchants, it will not only damage their business reputation, but also may affect the long-term development of the platform.

Therefore, e-commerce platforms and merchants should establish a healthier and more sustainable cooperative relationship, and jointly explore how to promote the orderly development of the industry while ensuring the interests of consumers.

So, in this war without gunpowder, there is no real winner.

Only when merchants, e-commerce platforms and consumers can rationally look at the price war and jointly maintain the industry ecology, can the entire e-commerce industry achieve sustainable development and win-win results.

How to break the game?

In the current competitive landscape of the e-commerce market, "price wars" seem to have become a norm, however, such a state cannot be endless.

The challenge is to find a way out of this environment and drive the industry in a healthy and orderly direction.

In the face of a bottomless "price war", the state has taken action to intervene to curb unfair competition.

In May this year, the State Administration for Market Regulation promulgated the Interim Provisions on Anti-Unfair Competition (the "Provisions"), which set clear regulations on price competition and other behaviors of e-commerce platforms.

Among them, the "Provisions" clearly point out that e-commerce platforms shall not impose unreasonable restrictions on commodity prices, aiming to create an orderly competitive environment and a good business atmosphere.

The "Regulations" will be officially implemented on September 1 this year, providing a strong institutional guarantee for the standardized development of the industry.

Interim Provisions on Online Anti-Unfair Competition

However, to achieve the healthy and orderly development of the industry, it is not achieved overnight, nor can it be completed by the country alone. This requires the joint efforts of many parties to form a joint force and jointly promote the healthy development of the industry.

For merchants, improving their competitiveness is the key to coping with the "price war". With the upgrading of consumer demand, simple low prices are no longer the only competitive factor. Consumers pay more attention to the cost-effectiveness of goods, including the quality, price, delivery timeliness and pre-sales and after-sales service of goods.

Therefore, businesses need to change their strategy from pure price competition to improving product quality and service levels. Enhance the core competitiveness of products by strengthening product research and development; Improve distribution efficiency by optimizing the supply chain and logistics system; By strengthening pre-sales and after-sales services, improve the shopping experience of consumers.

At the same time, merchants should also pay attention to brand building, enhance brand awareness and reputation, and enhance consumer loyalty to the brand.

E-commerce platforms also play an important role in dealing with "price wars". They should strengthen the guidance and management of merchants, and encourage merchants to compete by improving product quality and service levels, rather than relying only on price wars.

E-commerce platforms can introduce more preferential policies and service measures to support merchants to enhance their competitiveness; At the same time, strengthen the supervision and punishment of violations to maintain market order and fair competition.

It is gratifying that some e-commerce platforms have begun to focus on improving quality tonality and maintaining the health of the e-commerce ecosystem.

They regulate market behavior by restricting low-priced drainage and low-rated products, and attract consumers by optimizing the shopping experience and improving service quality.

For example, the video account has restricted the access of goods less than 5 yuan to the preferred alliance, and investigated the barbaric drainage method of "low price and high post". This trend not only deserves the attention of the industry, but also should serve as an example for us to learn from.

Price wars can only be a short-term strategy, not a long-term solution. Only when merchants, e-commerce platforms and regulatory authorities work together to form a multi-party co-governance pattern can we break the vicious circle of price wars and promote the e-commerce industry towards a healthier and more orderly future.

The hustle and bustle will eventually dissipate, and only by constantly improving our own strength and truly doing our best can we meet new opportunities and challenges.

Author | Wu Xin

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