JD Ali and Pinduoduo, who wants to kill 618 the most?

BT Finance

2024-06-26 07:00Posted on the official account of BT Finance in Beijing

This year's 618 seems to be exceptionally quiet, but the data released by the three e-commerce giants of 618 is not bad.

618 does not have the previous bombardment, overwhelming advertising, the expectations of the people around 618 are not obvious, and the number of packages at the express station downstairs has not increased significantly, the boss said "there has been an increase, but it is not too obvious".

The data released by JD.com 618 this year is not bad, with more than 500 million users placing orders, 83 brands with a cumulative turnover of more than 1 billion yuan, and more than 150,000 small and medium-sized merchants with sales growth of more than 50%. Alibaba's battle report is that 365 brands have exceeded 100 million yuan in Tmall 618, and more than 36,000 brands have doubled their transactions. As Taobao's strong point, live streaming will inevitably announce the relevant situation. This year's live broadcast performance is good, after the market value is far more than Pinduoduo, Jingdong and Ali have found some "field" in this year's big promotion, Taobao in the 618 period, the live broadcast room of the talent exceeded 100 million yuan34, a year-on-year increase of 53%, and there were 47 stores that broke 100 million yuan. JD.com's live broadcast orders increased by more than 200% year-on-year in the same period.

Pinduoduo, which has the highest market capitalization, is a little low-key, with almost no data released, and only some single product data has been released. For example, the home appliance brand set a record of 103% year-on-year in category sales in 618. Live streaming is not Pinduoduo's strong point, and Pinduoduo has not disclosed relevant data in this regard.

The top three e-commerce companies are all talking about how well they are performing, but the cumulative sales of integrated e-commerce platforms and live broadcast platforms are 742.8 billion yuan. Last year, the figure was 798.7 billion yuan, down 7% year-on-year. In terms of channels, the total sales of integrated e-commerce platforms reached 571.7 billion yuan, down 6.9% year-on-year. Because none of the three have announced specific sales. According to Xingtu data, Tmall occupies the top position of the comprehensive e-commerce platform, followed by JD.com, and Pinduoduo ranks third. This may be a possibility that all three companies may have increased their orders, but the prices were lower, causing the total sales to decline.

It should be noted that this 618 report card, which seems to be qualified, is actually full of "moisture" compared with the past, because this is the longest 618 statistical time in history, Pinduoduo entered 618 from May 19, Tmall entered 618 from May 20, and Jingdong entered 618 from May 31, which means that the 618 statistics are at least 10 days more than last year's sales. In the case of Tmall and Pinduoduo, the entire 618 promotion lasted for a month. The one-month sales were down about 7% compared to the 20 days of sales last year.

This situation has led to the non-purchase of capital. In the two trading days after 618, the stock prices of the top three e-commerce companies have declined to varying degrees. As of the close of trading on June 20, JD.com's shares fell 1.27%, Pinduoduo fell 0.03%, and Alibaba fell 0.15%, down 0.65%, 2.78%, and 0.12% respectively in the previous trading day. JD.com's market capitalization is only $43.79 billion, an evaporation of $117.6 billion from the high point of $161.4 billion, and Alibaba's total market capitalization is $179.8 billion, compared with the peak market value of $765.8 billion, an evaporation of $586 billion. Pinduoduo, which currently has the highest market capitalization, is $200.2 billion, but it is also down $95 billion from its peak, and Pinduoduo has the lowest decline compared to JD.com and Alibaba, so that it is now the one with the highest market value among the top three e-commerce companies.

It can be seen that a "big promotion" like 618 may have stepped down from the altar, and it cannot become a lifesaver for the top three e-commerce companies.

618 fell for the first time in 16 years

618 has special significance for both JD.com and Liu Qiangdong.

According to reports, on June 18, 1998, Liu Qiangdong and his first girlfriend Gong Xiaojing started a business in Zhongguancun to establish Jingdong Company. Jingdong's official website also introduced that on this day, Liu Qiangdong founded Jingdong Company with an initial capital of 12,000 yuan. The date of JD.com's listing on the Hong Kong Stock Exchange is also June 18, and even the stock code is 09618. HK。

At the same time, 618 is also the anniversary of the establishment of Jingdong Mall, in 2008, Jingdong opened the first 618 shopping festival, when Jingdong launched the "618" mid-year promotion on the website for the first time, at that time it was still presented in the form of pre-sale, supplemented by the form of seckill to attract consumers, from seckill to group buying, from brand special offers to full reduction. It has become one of the most important promotional nodes of JD.com throughout the year. At this time, 618 has become a real shopping carnival that many consumers must pay attention to.

After 2011, Jingdong 618 began to gradually evolve into a shopping festival in the e-commerce industry, and other e-commerce platforms began to participate. 618 has grown from a simple promotional event to a landmark event for JD.com and even the entire e-commerce industry.

In 2017, JD.com announced the sales of 618 for the first time, with 119.9 billion yuan under the industry caliber. did a real "show of muscles", and the myth of 100 billion overnight began to appear. 618 has also become the main arena of e-commerce competition, and more and more e-commerce companies have begun to participate and disclose their performance. At this time, the sales of major mainstream e-commerce companies are basically in a state of growth, and they are willing to let investors see their strength. However, starting from 2022, the slowdown in growth has been the general status quo of major e-commerce, and e-commerce companies have begun to stop announcing specific sales based on low growth rate or decline.

After 16 years of development, 618 has actually innovated this year, and various platforms have abandoned the original widely criticized "routine" and canceled the pre-sale system that has been used before. However, as of June 20, the major e-commerce platforms still have not released specific GMV figures, and instead have more ambiguous growth rates. gives people an intuitive feeling that this year's 618 is relatively "bleak". An intuitive data, on May 19, Tmall Li Jiaqi's beauty special live broadcast began pre-sale, and the GMV of the beauty category reached about 2.7 billion yuan, a decrease of 46% from the value of nearly 5 billion yuan in the same period last year.

Compared with previous years, this year's 618 "big promotion" has a longer time, and public information shows that the average duration of 7 mainstream e-commerce 618 is more than 30 days, of which Kuaishou has the largest span, reaching 42 days. The least time was 21 days for JD.com. Ali and Pinduoduo are both 33 days, of which Ali has been extended by 7 days compared with last year, Pinduoduo has been extended by 4 days, and only JD.com has shortened by 8 days.

However, even with 618, which has been extended for a few days, the overall sales have declined for the first time since the establishment of 618, with a 7% decline on both the entire network and the comprehensive platform, which is the first decline in 618 in 16 years. Based on consumers' current spending habits, this year's decline in 618 may be just the beginning. In this context, the e-commerce promotion seems to be losing its meaning, the myth of 100 billion yuan overnight is fading, and consumers' consumption habits are gradually becoming rational.

The rebound in consumption has nothing to do with the "big promotion".

The three years affected by the epidemic and the uncertainty after the opening up have caused the consumption environment to be relatively turbulent in the past few years. However, compared with previous years, the overall consumption environment has improved this year, and consumption is in a period of strong rebound. According to data from the National Bureau of Statistics, in May 2024, the domestic retail sales of the whole network reached 2,031.3 billion yuan, a year-on-year increase of 15%. In the first five months of 2024, food, clothing, and consumer goods increased by 19.6%, 9.0%, and 10.8% respectively, all of which are in a stage of rapid growth.

At the same time, according to the data of the "618" Consumer Insight Report (2024), the overall online retail sales from May 31 to June 18 reached 1,149.12 billion yuan, a year-on-year increase of 10.5%. Among them, the physical online retail sales were 994.99 billion yuan, a year-on-year increase of 7.8%. The total sales of major e-commerce platforms have declined by 7%, which means that the consumption environment has become better and the willingness to consume is also increasing, but this wave of consumption dividends has nothing to do with e-commerce.

In the past, 618 was a national carnival shopping festival, and even because of the pre-sale system, there were consumers who squatted all night in order to kill for a limited time, but now with the emergence of low-cost platforms such as Pinduoduo, consumers no longer need to wait until 618 to have a special price of 618, almost every day is 618, and naturally consumers' expectations for 618 are much lower. After more than 10 years of development, 618 has transformed from a traditional e-commerce festival to a national carnival, penetrating into all walks of life. Offline supermarkets, local life and other fields have gradually begun to try online. In the past, e-commerce played a set of "limited-time spikes" that have lost their appeal.

According to data from Qualcomm Transportation, the number of parcels during the 618 period this year has actually increased significantly. From May 20th to May 26th, the first week of the 618 promotion, the national express delivery volume was about 3.593 billion pieces, an increase of 7.29% month-on-month, and the average daily business volume reached 513 million pieces. However, in the third week of the 618 event, the cumulative collection volume of postal express delivery decreased by 3.31% month-on-month, and the cumulative delivery volume decreased by 0.73% month-on-month. However, even if there is a month-on-month decline in parcel volume, there is a significant increase compared to the same period last year, and in the same period of 2023, the average daily parcel volume will be 400 million, an increase of 25% compared with the same period last year.

The increase in parcel volume is huge, but the overall sales have declined, which means that the unit price of major e-commerce companies is declining sharply, and the platform is directly fighting a price war. For example, in the "618" Consumer Insight Report (2024), the average prices of men's shoes, women's clothing, men's clothing, and women's shoes decreased by 18.4%, 9.6%, 9.5%, and 2.8% respectively during the event. Among them, the average price of men's shoes has fallen the most. And this is only the year-on-year decline in the price of some commodities, on the whole, the price of most products has declined, but the price has risen very little.

E-commerce practitioner Wang Bao did not participate in the 618 promotion this year, and originally planned to participate, but the platform asked him to force a price reduction of 5%, which made it difficult for him to accept. "Originally, we are the amount of walking, small profits but quick turnover, the profit is about 3%, if the price is reduced by 5%, then I am losing money and making money, rather than this, it is better not to participate." For consumers are no longer keen on big promotions like 618, Wang Bao believes that daily e-commerce companies are already fighting price wars, and prices have been pressed to the extreme, "In fact, for consumers, it is now 618 every day, and consumers' interest in such so-called big promotions is weakening." "And businesses like Wang Bao who don't do 618 are not alone, many businesses feel unprofitable, time-consuming, and labor-intensive, and directly stop participating.

In fact, the low-price strategy is eroding the interests of merchants, and many merchants are under the coercion of the low-price strategy, the pressure has doubled, and there is even the possibility of losing money. Some merchants reported that the platform disrupted the market by monopolizing resources and forcing price reductions, resulting in merchants being unable to set prices independently and their profit margins being seriously compressed. Coupled with the full reduction, free shipping and other promotional offers required by the platform, the platform has made a profit, but the operating costs of merchants will surge. Some netizens complained on the Internet and broke the news that their friend's women's clothing online store had sales of nearly 10 million yuan during the 618 period, which seemed to be good sales, but it was not unknowing, and it was shocking. After deducting only 3.5 million yuan for refunds, 3.8 million yuan for returns and refunds, plus other costs, the final loss is expected to be about 600,000 yuan.

E-commerce Three Kingdoms Killing, Who Gets Hurt the Most?

At present, the mainstream e-commerce is mainly based on Ali, Jingdong and Pinduoduo, two of which have changed their senior management, Jingdong will retire after the Double 11 in 2023, Jingdong Retail CEO Xin Lijun will retire, Jingdong Group CEO Xu Ran will also serve in this position, and soon Ali will be similar to JD.com, Ali Group CEO Wu Yongming replaced Dai Shan as the CEO of Taotian Group. Both are the CEOs of the group who are personally in charge of the e-commerce business, which shows the importance attached to the business.

The two CEOs are at the helm of the e-commerce business, but in fact, there is no too good way, and competing prices has become a cliché and helpless move. The price war is a fact on the bright side. According to media reports, at the beginning of June, after searching for "cheaper than JD.com" on Taobao App, you will jump to a price comparison page with "no matter how low the price is" written in a prominent position at the top, and below is the price comparison of specific product categories. Similarly, Jingdong is also "not far behind", searching for "cheaper than Tmall" will jump to the price comparison page of "cheaper than Tmall, buy more expensive and double compensation", but the page jumps of Taobao and Jingdong have been offline.

In May, Douyin officially announced a small range of e-commerce price change system, which is based on the price of the whole network through intelligent analysis to give the price change range, which has become another milestone in e-commerce price comparison, and then Pinduoduo followed up and launched an automatic price matching system, which is gone in the era of high growth when e-commerce users hit the ceiling, taking Ali as an example, the revenue growth in the past three years was 18.93%, 1.72% and 8.34% respectively. The growth rates from 2019 to 2021 were 50.58%, 35.26% and 40.72%, respectively, with a significant decline. JD.com, too, has seen revenue growth of 18.29%, 13.95% and 8.59% in the past three years, showing a downward trend. In the previous three years, the lowest increase was 28%.

Revenue slowed down, and users hit the ceiling. Whether it is the traditional top three of Alibaba, JD.com, and Pinduoduo, or emerging e-commerce companies such as Douyin, Kuaishou, and Xiaohongshu, they have all actively or passively joined the "price war".

Zhang Fei, the person in charge of a brand online store in Shanghai, expressed concern about the price war, "At present, the price is already at a low level, and it will soon be irreducible, which will damage the interests of some brands that are not strong enough." It is unhealthy to fall into a vicious circle of not making money or losing money without a price war, and it will not be sustainable for a long time. "For the competition between Alibaba, Pinduoduo, and JD.com, Zhang Fei believes that this is more beneficial to Pinduoduo, and it hurts Ali the most." Pinduoduo itself is the main low price,Jingdong focuses on the timeliness of the shopping experience,Ali on the price may not be comparable with Pinduoduo,The timeliness of the shopping experience is not comparable to Jingdong,Although Ali performed well in this year618Ranked first,But in the long run,The most injured may be Ali。 Of course, JD.com also faces challenges, after all, the rise of new e-commerce companies such as Meituan, their timeliness advantage is gradually eroded. ”

Perhaps, as Zhang Fei said, Ali is currently the top three e-commerce e-commerce companies in the United States, with a high point of 586 billion US dollars, and Pinduoduo, which is known for its low price, has become the one with the highest market capitalization.

618 has come to an end, and overall there are mixed joys and sorrows. The good news is that the e-commerce companies have cut off the "price increase and then price reduction" and various hidden algorithms, and began to carry out the most direct price "bayonet", which allows consumers not to spend brainpower to calculate which one is more cost-effective, simple and clear. The worry is that although the "low price" has been carried out to the end, there is still an embarrassing situation of declining total sales, and consumers' passion for 618 may have dissipated, which is the worst year in the past 16 years 618, but it may be the best 618 in the future. In the case of touching the interests of many merchants, it is unknown how many merchants will be willing to participate in 618 in the future, and whether there is any other path for shopping malls to compete in addition to the price of short-term combat? It will be a problem that Ali has to pay attention to and solve.

Author | Dream Shaw

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