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Text｜New Media Technology Review

For Internet companies, the only constant is perhaps "constant change". Recently, Taobao announced that it will optimize the "refund only" strategy, enhance merchants' after-sales autonomy based on the new experience score, and reduce or cancel after-sales intervention for high-quality stores.

At the end of last year, Alibaba, JD.com, Douyin, Kuaishou, and even overseas players Amazon and TEMU all launched refund-only services, and "refund-only" has almost become the standard in the domestic e-commerce industry.

But at present, "refund only" has not only failed to bring a "bright future" to the e-commerce industry, but has caused a lot of controversy in the industry, and many merchants have complained about it.

At a time when user traffic has reached its ceiling, e-commerce platforms want to improve consumer experience and expand GMV, and they also want to protect the rights of merchants as much as possible and charge traffic fees. However, you cannot have your cake and eat it too. "Refund only" has instead broken the delicate balance between users and merchants.

Now, half a year has passed, perhaps it is time for the platforms to wake up from the dream of "learning from Pinduoduo and becoming Pinduoduo" and find a development model that suits themselves better in order to get back on track of growth.

E-commerce platforms begin to "correct"

According to the new rules released by Taobao, for merchants with a store experience score of ≥4.8, the platform will not immediately support refunds, but recommend consumers to negotiate with the merchants first. For merchants in other segments, the platform will grant different degrees of autonomy based on the experience score and industry nature.

In addition, Taobao will also provide a variety of after-sales service plans for merchants to choose from, reducing disputes and financial losses caused by "refund only". When merchants object to "refund only" and file a complaint, the platform will ask a third-party testing agency to intervene. If the test passes, the platform will also compensate the merchant for the loss.

In simple terms, Taobao no longer treats merchants with a "parental" tough attitude, but hopes to guide merchants and consumers to negotiate and communicate on their own. Of course, this communication standard is still biased. The higher the merchant experience score, the greater the disposal power, and merchants are encouraged to optimize services in other ways.

In fact, when the refund-only policy was first introduced, all major platforms mentioned that they would make a comprehensive judgment on buyers' applications. For example, JD.com and Taobao mentioned that the platforms would make a comprehensive judgment on merchants based on big data, and then decide whether to agree to consumers' refund-only applications; Douyin mentioned that if the product's praise rate is lower than 70%, the platform has the right to support consumers' after-sales applications for refunds only and refunds with shipping included for returns for the product transaction orders.

However, in the actual implementation process, the "refund only" balance is "one-sided". Searching for "refund only" on social platforms, taking Taobao as an example, some merchants' orders from several years ago were also refunded; some consumers only applied for a 7-day refund without reason, and the platform also approved the refund only.

Some merchants said that as long as the platform detects keywords, it will actively intervene in the after-sales process and directly send a pop-up window for refund to consumers. There is basically no "comprehensive judgment" of the platform, and most of the initiative is on the side of the consumers.

In fact, the original intention of the e-commerce platform to launch a refund-only service was to eliminate low-quality merchants and improve user experience, but in reality this policy is an "indiscriminate attack" on all merchants. While low-quality merchants have not been eliminated because of "refund only", small and medium-sized merchants that operate in compliance with regulations have been badly cheated by "professional wool parties".

"Refund only" deviates from the original intention

Since "refund only" became the standard for e-commerce platforms, various strategies for "getting free stuff" have spawned a complete gray industry chain. Some people have organized paid learning groups to teach netizens how to "get free stuff" by self-destructing goods, complaining about merchants, and other means.

Some intermediaries sell discounted goods on second-hand platforms. Consumers place orders on the official website at the same time after purchasing. When the consumer confirms receipt of the goods, the intermediary applies for "refund only". At this time, the consumer gets the goods, the intermediary gets the money for free, and only the merchant loses the money.

A merchant engaged in maternal and child products said that in the past, only Pinduoduo launched a refund-only service, and the industry had not yet formed a "gray industry awareness", and there were only two or three "refund-only" orders a year. However, this year, there are an average of two or three "refund-only" orders every day.

For this reason, more and more businesses are unwilling to passively "take the hit". Some businesses choose to use legal means to protect their rights and bring "wool-gathering gangs" to court; some businesses form mutual aid associations to help members "recover" returned goods from thousands of miles away.

In fact, the human and material costs of merchants' rights protection are not small. Merchants drive thousands of miles to demand goods and compensation from buyers, and the fuel, road and accommodation expenses are a large expense. In addition, merchants who choose to sue must also go to the court where the buyer is located, which is also very costly.

Moreover, the probability of a business getting compensation after suing is actually not very high. One business roughly estimated that among the more than 4,000 court decisions he knew of, the proportion of businesses winning the case was less than 25%. Even if they win the case, the business will receive compensation ranging from hundreds to thousands of yuan, and after taking into account costs such as road tolls, there is actually not much left.

In the final analysis, the merchants are just trying to vent their anger and seek an explanation. Because behind these cases is the fact that the merchants' profit margins have been squeezed to almost zero by "refund only".

During the "618" shopping festival this year, #Merchants complain about return rate as high as 80%# was once a hot search. Some industry insiders said that once the return rate exceeds 50%, it may have touched the "life and death line" of the merchant, and this is still the case when the goods can be returned. If there are a large number of "refund only" orders, the merchant will lose both money and people.

The "refund only" policy alone is enough to make merchants anxious, but under the principle of "customer first", Taobao also released what is known as the "strictest customer service standard in history" at the end of July, including that customer service may be fined for slow response, arrogance, impatience, etc.

In addition, Taobao has also adjusted the evaluation standards and credit points, and cancelled the function for sellers to evaluate buyers, which means that the seller's position in the transaction will become more passive.

However, when Taobao proposed the most stringent customer service standards, it immediately "relaxed" its refund-only policy. This is also seen as Taobao's move to adjust its service system. Perhaps it has finally realized that the refund-only policy is not suitable.

The industry does not want a second "Pinduoduo"

At the end of last year, Pinduoduo's market value surpassed Alibaba for the first time. Jack Ma made a rare statement on the intranet, saying, "Everyone has been awesome, but only those who can reform in order to be awesome tomorrow or the day after tomorrow, and those who are willing to pay any price and make any sacrifice, deserve respect."

After that, Alibaba made more attempts and adjustments in business development. On the one hand, Alibaba almost suspended all IPO projects. Alibaba CEO Wu Yongming said that in the future, Alibaba will prioritize the three core development directions of Internet platform business, AI-driven technology business and global business network.

On the other hand, based on the principle of "devoting more resolutely and making more decisive choices", Alibaba Chairman Joseph Tsai said that the primary goal is to win in the e-commerce field, and to do this, it is necessary to restore market share and promote business growth. Subsequently, Alibaba has fired the "first shot" in the e-commerce field many times, including launching a refund-only policy and canceling the pre-sale system.

With these efforts, Alibaba's e-commerce business has also started to return to the growth track. Taking this year's "618" as an example, according to the iResearch report, the growth rate of Taobao and Tmall's transaction volume reached 12%, which is higher than the average growth rate of comprehensive e-commerce GMV.

However, behind the growth of Taotian, Alibaba also sacrificed a lot of profits. According to Alibaba's first quarter report in 2024, Taotian Group's revenue increased by 4% year-on-year to 93.216 billion yuan, but Taotian's adjusted EBITA fell slightly. Taotian's spending on user experience obviously also eroded part of its profits.

Therefore, Alibaba e-commerce will not only pursue user scale, but also increase profits. Since the beginning of this year, Taobao's "five-star price power" strategy has been weakened. It is no longer about the lower the price, the higher the traffic, but gradually increasing the weight of GMV (transaction amount) and AAC (average consumption amount).

Taobao has realized that it does not need to become the second "Pinduoduo", but needs to take a new path. In the fourth quarter earnings conference call last year, Wu Yongming said that on the basis of maintaining the richness of the Taobao market, some core products with high sales rates will be provided with higher commodity efficiency, so as to establish Alibaba's unique competitive advantage in the e-commerce market.

Taobao is a comprehensive e-commerce platform with all kinds of average order values. To maintain the richness of its business and improve the efficiency of product sales, it cannot simply tip the scales towards consumers but must also consider the acceptance of merchants and achieve a balance between merchants and consumers.

In this context, Taobao's abandonment of the "refund only" policy that was too biased towards consumers is a step towards protecting the interests of merchants. Moreover, loosening the "refund only" policy does not mean that it does not value user experience. It is reported that in addition to introducing the most stringent customer service standards, Taobao will also further increase the freight insurance subsidies for merchants.

It seems that Taobao has simply given up its "one-size-fits-all" management approach and turned to a more comprehensive merchant management system that requires both strict discipline and incentives, handing the initiative back to high-quality merchants and allowing them to find ways to attract consumers. Only then can the platform's scale and profit growth achieve a positive cycle.

Next, other e-commerce platforms will most likely optimize their refund-only policies. After all, different e-commerce platforms have different positioning. There is more than one solution to improving merchant quality and consumer experience, and "refund only" may not be the best answer.

Taobao fired the "first shot of anti-rolling", which also gave the e-commerce industry a reference. Instead of following the trend of price reduction, it is better to find its own unique advantages. What the e-commerce market needs is not another Pinduoduo, but a new Taobao, a new JD.com, and a new Douyin. The path that suits you is the best path to take.