618 finally comes to an end, but the platform, merchants, and consumers have different feelings. Some are happy and some are sad.
Judging from the current results announced by major platforms, they seem to be very impressive, and sales are not bad. However, many merchants said that price competition and unfair return policies have made them miserable and even lost money. Consumers revealed that this year’s 618 not only benefited from price competition, but also suffered from buying low-priced and low-quality products.
When e-commerce first emerged, it was born in response to the times. It was for people to shop more cost-effectively and get a good consumer experience. Looking at it now, if the shortcomings of low-price competition and return policies are not avoided, the legitimate interests of merchants will be infringed on in the three-party game between platforms, merchants, and consumers, and the entire e-commerce ecosystem will be seriously damaged.
01
Low-price competition is fierce,
many businesses have encountered challenges
618 has ended, and the battle report has been released.
The first companies to disclose data were Taobao and JD.com. As of 24:00 on June 18, the transaction volume of 1.9 million Taobao small and medium-sized merchants increased by more than 100% year-on-year, and the number more than doubled compared with last year. The latest data released by JD.com shows that in 2024, JD.com’s 618 transaction volume and order volume reached new highs, and JD.com’s live broadcast order volume increased by more than 200% year-on-year.
Comprehensive data shows that this year’s 618 big promotion live streaming e-commerce sales such as Douyin and Kuaishou reached 206.8 billion yuan. Comprehensive e-commerce platforms such as Pinduoduo, Tmall, and JD.com recorded sales of 571.7 billion yuan, a year-on-year decrease of 6.9%. Instant retail sales across the entire network were 24.9 billion yuan. Community group buying amounted to 13.9 billion yuan.
However, although the sales performance of is quite impressive, it is by no means a happy one. Many merchants said: "This year's 618 promotion is really good, the platform does not care about the life and death of merchants." Among them, what is criticized by merchants is the endless price competition. In particular, live broadcast e-commerce has maximized the efficiency of low-price large group purchases. Other comprehensive e-commerce companies have also launched price competitions, using the slogan "low prices across the entire network, don't be afraid of comparisons", competing across the air, automatically following prices, and offering extremely low prices. Strategies to compete for consumers.
We have come to an era of surplus goods and serious homogeneity. As a marketing strategy, it is understandable to carry out low-price competitive promotions, but it is not advisable to be too eager for quick success and quick profit, which has caused many merchants to be injured. On the surface, sales of goods at low prices have increased, and merchants should increase revenue; in fact, endless price competition has caused merchants' profits to become thinner, or even negative. Many merchants said that this year's 618 promotion was just a rush to get products on the shelves, and they did not expect that the platform's price reduction could go as far as this.
Without knowing it, many merchants have frequently lowered the price of the products they sell by the platform's discounts. After various mechanisms are superimposed, the final transaction price is "fractured." The final sales volume of products has increased year-on-year, but profits are often negative. Some e-commerce platforms have experienced a surge in order volume this year, but sales have declined year-on-year. The reason seems to have been found. This practice of sacrificing profits in exchange for order volume costs merchants real money.
In addition, using low-price de-rolling methods in various ways can only result in lower prices, and some merchants have to sacrifice product quality in the end. The various return policies introduced by the platform to express goodwill to consumers have led to the emergence of new crises and challenges. The return rate has remained high, and merchants have been miserable.
02
has a high return rate.
Who is the devil?
In addition to price competition, this year’s 618, the product return rate is also high.
Some time ago, someone broke the news that a certain clothing online store had sales of nearly 10 million yuan during the June 18th promotion. However, after deducting 3.8 million yuan for "returns and refunds", it also deducted 3.5 million yuan for "refunds only". , and finally deducting other costs such as labor fees, packaging fees, platform service fees, etc., the estimated loss is as high as more than 500,000 yuan.
Merchants originally thought of making a lot of money through 618, or even a small amount, but they didn't expect to suffer losses because of it. It's really hard to tell.For the clothing industry, the return rate of goods can only be profitable if it remains within a certain range. For example, for this clothing online store, the return rate exceeds 70%, or even close to 80%, and it is inevitable to lose money.
In fact, during this year’s 618 promotion, not only clothing merchants encountered the problem of high return rates, but many other merchants also encountered this dilemma. So here comes the question: The return rate of goods remains high, who is causing trouble? In this regard, consumers, merchants, and platforms all have different opinions, and they all seem to behave like "victims."
Consumers are the main subjects of returns, are they all responsible? Many consumers said that they seemed to have been deceived when shopping on multiple e-commerce platforms during the 618 promotion. The most serious problem was that the goods were not in the correct version, that is, the actual goods were seriously inconsistent with the promotional pictures. After buying these products, some people make do with them, while others return them if they are not popular enough.
For consumers, shopping is a necessity in life, and shopping during 618 is to save money. In the final analysis, consumers want to buy products with high cost-effectiveness and quality-price ratio during the big promotion period, which are cheap and easy to use.
Let’s take clothing as an example. Generally speaking, as long as the clothes are the right size, the right size, the actual color and style are similar to those advertised in the pictures, and there are no quality problems, consumers will not return the goods. After all, consumers spend a lot of time and money on shopping. From this perspective, not many people will maliciously return or exchange goods and cause trouble for themselves.
Merchants also have explanations for this, targeting consumers and platforms. Most of the opinions are that consumers are difficult to deal with and are picky about the products they buy for various reasons, and the platform is also encouraging this trend and providing various supports. For example, "refund only", "return without reason", "freight insurance", etc. Many merchants complained that these rules and regulations of the platform transferred all risks and costs to the merchants. A school purchased clothes for a performance and then returned them after the event. The clothes were smelly. Is it reasonable to return the clothes unconditionally?
E-commerce platforms also have their own set of debate logics. Only by grasping low-price competition and return policies can they effectively capture the "hearts" of consumers. Otherwise, they may be at a disadvantage in the competition with other e-commerce platforms.
03
In the new consumption era,
e-commerce still needs to break through.
How can we truly capture the hearts of consumers? In the new consumption era, consumers are very cautious about products. In the past, people pursued cheapness, then cost-effectiveness, and now they increasingly pursue quality-price ratio. Products must not only be low-priced, but also of good quality.
Compared with the e-commerce 618 promotion, many merchants have done well in offline marketing this year. Some merchants do not sacrifice product quality, but trade quantity for price to benefit consumers. , for example, has recently taken the initiative to transform some offline supermarkets, as well as previously prosperous membership stores, by reshaping the supply chain and connecting upstream and downstream, ultimately achieving a win-win situation for both merchants and consumers.
In response to the 618 promotion, some offline retail channels have opened up the "shopping, playing and shopping" consumption scenario in one stop, attracting the emotional value of young people and enabling companies to win in the homogeneous competition. This approach not only greatly reduces the return rate, but also expands sales, making both merchants and consumers satisfied.
If e-commerce companies do not take the initiative and rely solely on low-price competition and return policies at the expense of merchants’ interests to attract consumers without other bright spots, they are likely to be overtaken by offline businesses in the future.
At present, if the e-commerce ecosystem wants to maintain healthy development and eliminate price competition, it must continue to make efforts in at least three aspects.
First of all, the platform must improve the return policy, and products of different categories should be treated differently. While ensuring the interests of consumers, merchants should also try their best to avoid losses, and promote a win-win situation for consumers, merchants, and platforms.
Secondly, it is not impossible to compete at low prices, but it requires a good grasp of the degree. Merchants must retain profits to promote product innovation and upgrading, use quality to win the market, and use extraordinary to gain consumer recognition. Really good products will have brand premiums. of.
Finally, strengthen the construction of the e-commerce supply chain to make it more efficient, reduce costs, and make low prices more reasonable without sacrificing product quality.
Only by doing this can the e-commerce ecosystem get rid of the vicious cycle and develop in a healthy way. Ultimately, consumers, merchants, and platforms can all benefit from it and achieve a perfect closed loop.
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