JD.com said it has received information from merchants indicating that Alibaba, which dominates China’s e-commerce market, is “forcing” them to choose to exclusively deal with one e-commerce site during promotional activities. In the past the Hangzhou, China-based company has said it doesn’t put pressure on merchants in relation to other platforms.
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While turnover of the country’s online retail increased by 40% annually to 2.8 trillion yuan ($442 billion) previous year, the manufacture and sale of shoddy or counterfeit goods has become a key concern in the sector, the report cited the Ministry of Commerce as saying.
The biggest rival to Alibaba Group Holding Ltd.in Chinese e-commerce is accusing the technology giant of violating market regulations and hampering competition in the run-up to the nation’s largest online sales promotion.
In terms of transaction value, Alibaba is still the leader, with JD.com the second largest e-commerce company.
Brands such as Nike, Uniqlo and Samsung set up stores in these online shopping malls. As per the complaint, Alibaba had asked merchants not to cooperate with e-commerce platforms who are participating in promotions at “Singles Day”.
The SAIC has not commented.
Alibaba said in an email to Caixin that Tmall has more authentic products, better services, lower prices and faster delivery, and its competitors should face the facts. JD.com was panicking because Alibaba wins with merchants and consumers by offering them a “superior experience”.
Alibaba, which started Singles’ Day in 2009, began replicating its success overseas past year, seeing sales spikes led by Russian Federation.
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Last year Alibaba sold $9.34 billon worth of goods on Singles Day, more than triple the $2.68 billion in sales revenue for all USA merchants combined last year on Cyber Monday, the e-commerce shopping event that takes place after the Thanksgiving holiday. JD did not disclose its GMV but said it processed 14 million orders that day.
