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Pinduoduo heats up online price war during China’s 618 shopping festival

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The novel system, which Pinduoduo rolled out on Wednesday, provides merchants on the platform a fast and intelligent way to “keep pace with [the pricing strategy of] competitors”, according to a report by Chinese digital media DoNews on Thursday.

The system, for example, will automatically adjust the online prices of its user as soon as it finds a rival merchant offering lower prices, the report said.

According to screenshots of the system posted by Pinduoduo merchants on Chinese social media, subscribers can set up a specific range that the system would follow when adjusting the price of goods. The system will be in operation until June 21, which is the end of Pinduoduo’s 618 sales campaign.
Pinduoduo’s automated price-tracking system is expected to give merchants on the platform a competitive edge during this year’s 618 shopping festival. Photo: Shutterstock
Pinduoduo’s latest initiative reflects the escalating price war among China’s e-commerce services providers amid a slowdown in retail sales.
ByteDance-owned Douyin recently started internal tests for a similar smart pricing system for merchants, according to Chinese media reports.
Those moves show how online shopping platform operators are looking to boost sales during the 618 shopping festival, following a relatively muted run in 2023. All the major domestic e-commerce players are expected to offer steep discounts and cash subsidies.
The festival, which was initiated by JD.com in 2010, began as a simple promotion for the firm’s June 18 anniversary. The event has since grown into the country’s second-biggest shopping extravaganza behind Singles’ Day in the fourth quarter.

Pinduoduo kicked off its 618 sales campaign on May 19, but has yet to release any sales figures.

An advertisement for the 618 shopping festival promotion on Alibaba Group Holding’s Tmall platform at a subway station in Shanghai. Photo: Bloomberg
Alibaba Group Holding, which started its promotions on May 20, touted last week that 59 brands on its platforms each saw their gross merchandise value (GMV) – the total amount of goods sold – surpass 100 million yuan (US$13.8 million), while 376 products saw GMV exceed 10 million yuan. Alibaba owns the South China Morning Post.

JD.com, meanwhile, kicked off its 618 promotions on Friday evening.

Alibaba’s Taobao and Tmall Group have upgraded the price guarantee feature on their apps for this year’s event, allowing consumers to receive a refund on price differences until July 5, in case any further discounts are found online after they made their purchase.

In 2021, Pinduoduo was the first major e-commerce platform to introduce a refund policy that allowed users to get their money back without returning goods that do not match a merchant’s description. That policy is credited with helping Pinduoduo draw more price-sensitive Chinese consumers away from its competitors.

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