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Author | Liu Baodan

Editor | Zhou Zhiyu

As the e-commerce war becomes increasingly fierce, e-commerce platforms' attitudes towards low prices have become divided. Alibaba no longer emphasizes absolute low prices, while JD.com has chosen to continue to increase its investment.

The Wall Street Journal learned that JD.com recently revised the "JD.com Open Platform Double Compensation Service Rules", with adjustments made to the price comparison platform scope and the definition and price of the same product. The core is to expand the service scope of "double compensation for overpriced products". The rules will take effect on August 8.

This means that JD.com is still continuing to increase its low-price strategy in an attempt to gain a larger market share.

The "Double Compensation for Expensive Purchases" service means that after consumers purchase goods marked with this service logo, if the actual payment amount is higher than the actual payment price of the same goods sold on JD.com or other specific platforms, consumers can apply for compensation for the difference of double the actual payment amount within 24 hours. This rule is mainly aimed at the millions of merchants on the JD.com platform.

JD.com has further expanded its price comparison platforms. The previous platforms included: Pinduoduo 10 billion subsidies, Taobao 10 billion subsidies, Vipshop, Tmall, JD.com, and Tuhu Auto Maintenance APP. After the revision, JD.com not only covers Douyin, but also expands Taobao and Pinduoduo from the 10 billion subsidies channel to the entire platform.

JD.com has relaxed the threshold for the definition of the same product. As long as the sales volume displayed on the front desk is ≥30 and the reviews displayed on the front desk are ≥30, the products can participate in the comparison. Previously, the requirements were 100 items and 100 reviews respectively.

JD.com also updated the price definition of the same product to the actual amount paid by the consumer, with the key point being that it includes shipping costs.

By openly comparing prices with Taobao, Douyin, and Pinduoduo, we can see JD.com's confidence in low prices, which also demonstrates Liu Qiangdong's determination to regain the low-price mindset in the current e-commerce market.

In fact, since Liu Qiangdong proposed to resume the low-price strategy at the end of 2022, JD.com has continued to deepen its low-price strategy.

From launching the "10 billion subsidy" to vigorously supporting small and medium-sized businesses, from major personnel changes to promoting the purchasing and sales team, the core of JD.com's series of actions is low prices. Liu Qiangdong tried to regain the initiative in competition by increasing the supply of low-priced goods.

Judging from the first quarter financial report, JD.com's low-price strategy has initially taken effect. JD.com executives said in a conference call that the group achieved positive performance in user growth, user behavior and user experience in the first quarter, with strong year-on-year growth in quarterly active users and accelerated growth in user groups in low-tier cities.

In 2024, JD.com's core strategy will continue to be to enhance user experience and services and consolidate its core competitiveness. Management said in a conference call, "JD.com will promote the low-price strategy, reduce procurement costs, provide more low-priced goods, and improve the efficiency of low-price subsidies, so that users can feel the advantage of saving money more."

The revision of the "double compensation for overpriced products" rule is just one manifestation of JD.com's low-price strategy. In fact, JD.com has implemented the low-price strategy at many levels.

For example, in July, JD.com launched the “JD.com Super 18” campaign, in which JD.com will exhibit and sell products from major Chinese and foreign brands on the 18th of every month, including TCL color TVs, Bulgari perfumes and other big-name products worth more than 1,000 yuan, as well as “super family buckets” worth thousands or even tens of thousands of yuan. These products are only 18 yuan.

In May, Liu Qiangdong stated that he would give a salary increase to all JD.com procurement and sales personnel. Starting from July 1, 2024, the annual fixed salary of JD.com procurement and sales personnel will be increased from 16 salaries to 20 salaries, and there will be no upper limit on performance incentives. Prior to this, Liu Qiangdong had already given salary increases to the procurement and sales team many times. The procurement and sales team represents JD.com's low-price competitiveness.

More than a decade ago, JD.com was famous for being a low-price killer and won a great victory in the offline battle with companies such as Suning, thus establishing its position as an e-commerce giant, until this pattern was rewritten by Pinduoduo many years later.

This is also why Alibaba has begun to adjust the intensity of its low-price policy, while JD.com is still increasing its policy. Long before Pinduoduo, JD.com was also a platform that rose to prominence by low prices. Liu Qiangdong has faith in low prices. At the end of 2022, he rebuked his subordinates, "JD.com's retail business management culture has gradually been lost, and it no longer focuses on low-price advantages."

However, times are different now. If JD.com wants to break out of the competition by relying on low prices, especially when Pinduoduo has already occupied the mindset of low prices, the difficulty can be imagined.

What is certain is that Liu Qiangdong will fight this low-price war to the end.