Jack Ma and Richard Liu have both sensed the danger signals.

The strategy of returning to the low price of the whole network has made the 618, which has just come to an end this year, become the "most volume" 618 in history. Taobao Tmall, Jingdong, Kuaishou and other e-commerce companies all shout the slogan of "extreme low price" to consumers, trying their best to prove to the outside world their determination and strength of investment. According to a later LatePost today's report, in late may, Alibaba founder ma yun convened the business leaders of taotian group to hold a small-scale communication meeting. in ma yun's view, * * Taobao instead of Tmall is the next opportunity. Alibaba e-commerce should * * * * * * * return to Taobao "* * * . * * And after last year's Double Eleven, Liu Qiangdong also said bluntly that low prices are Jingdong's "big killer", * * requires every effort to reduce prices and improve services through the efficiency of the supply chain * . The "pre-e-commerce era" giants represented by Alibaba and JD have realized that it is becoming more and more difficult to earn every penny from consumers' pockets. Jack Ma and Liu Qiangdong have smelled red flags. PDD-style "low price x social fission" play is the final winner? ## Jack Ma: Alibaba e-commerce should "return to Taobao" According to a number of Alibaba employees, Jack Ma believes that the current competitive situation facing the Tao Tian Group is very serious, he took Nokia and Kodak as examples, that a company from the industry benchmark to death, six months to a year is enough, in the Internet industry this speed may be faster. According to media data, the total order GMV (total sales) of PDD and chattering e-commerce in 2022 has exceeded 50% of the Alibaba domestic e-commerce business. On the revenue side, PDD's revenue has reached 62% of Alibaba domestic e-commerce revenue in the first three months of 2023. Ma Yun pointed out three directions for Tao Tian Group at the meeting: return to Taobao, return to users and return to the Internet. In addition, Ma Yun believes that Tao Tian should be further flattened in organization. * * Many employees expect that after the end of the "618", the group will usher in a number of management system reforms. * * "Return to Taobao" means that * * Tao Tian Group will support small and medium-sized businesses with greater efforts in the future * . Many employees judged that Taobao's traffic mechanism may also change, from the original tilt to Tmall back to Taobao. Taobao also launched its first exclusive venue for small and medium-sized businesses during this year's 618-Taobao Good Price Festival. As of 0 o'clock on June 18, the turnover of more than 2.56 million small and medium-sized businesses this 618 exceeded that of the same period last year. There are also 1.18 million small and medium-sized businesses that have reached a small breakthrough of "10000 yuan deal", of which 68000 have joined Taobao for less than 3 months. This 618 can be seen, Amoy Group will also focus from fancy marketing shifted to low prices. Dai Shan, President of Taobao Tmall Business Group, said: "Taobao will make a huge investment in history to make a large user scale for merchants". Compared to GMV growth, Alibaba began to emphasize stock mining. " * When GMV **can't rise, we begin to emphasize private domain operation, that is, let merchants do a good job of retention and re-purchase, and make the value of single user." * *# * * Liu qiangdong: low price is jingdong's "big killer" * * Liu qiangdong once said bluntly after the 11th of last year that jingdong has given some consumers the impression that it is becoming more and more expensive. jingdong should serve consumers at multiple levels, considering both the rich and the ordinary:> * * low price is the most important weapon for our success in the past and the only basic weapon in the future. * * Liu Qiangdong warned managers not to ignore the demands of many grass-roots consumers just because their current life is better. They still pursue the ultimate cost performance of products in consumption, and do everything possible to reduce prices and improve services through the efficiency of the supply chain. Before the 11th of last year, Liu qiangdong replied to the employee weekly, saying that jingdong's retail business culture was gradually losing:> with the success of 3C home appliance business, many brothers began to be arrogant and complacent and stopped paying any attention to our low price advantage.>> If the customer experience of retail business is divided into three elements-price, quality and service, low price is "1", quality and service are two "0", losing the low price advantage, all other so-called competitive advantages will return to zero. Before the 11th of last year, Jingdong retail sectors adjusted their promotion strategies. Some liquor sales even fell below the purchase price, which directly led Luzhou Laojiao to suspend cooperation with Jingdong, while Wuliangye required to deduct Jingdong's market support fee of 3.65 million yuan. * * A Jingdong source said that compared with PDD, tremolo and other channels, Jingdong is really difficult to achieve competitive low prices at present: * *> Jingdong, as a large distributor of the brand side, directly purchases goods on behalf of the brand official, signs annual package contracts, has fixed prices and profit margins, and has little room for price adjustment. Jingdong's previous earnings report for the first quarter of 2023 showed that the outlook for the veteran e-commerce giant was not optimistic. Revenue for the full year 2022 was $1046.2 billion, up 9.9 percent year-on-year, and GMV was $3482 billion, up 5.6 percent year-on-year. In the previous 4 years, Jingdong's two indicators have almost maintained a high growth rate of more than 25% year on year. In addition, home appliances and 3C electronics, which account for nearly 50% of retail sales, will only grow 4.7 percent in 2022, compared with 23 percent the previous year. In the first quarter of 2023, the situation was even more serious, with 3C electronics and daily merchandise revenue falling slightly year-on-year. As we all know, 3C products are the basic disk of Jingdong retail. In Jingdong's main position 3C market, the decline in growth is an indisputable fact. On March 8, Jingdong billion subsidies online. It is understood that Jingdong "10 billion subsidies" project led by the Xinli army, in the budget level is not capped. Obviously, **this item is directly linked to the PDD. * * This year, Jingdong 618 will undoubtedly continue its "low price" approach. Data show that the number of commodities participating in the 10 billion subsidy "has reached more than 10 times that of March". "One-click price protection" was clicked more than 0.66 billion times. ## The final victory of PDD play? Since the beginning of this year, PDD has put forward the consumption concept of "every day is 618", increased the subsidy for high-quality supply, and successively launched a series of activities such as the digital home appliance consumption season, the fifth season's reading month, and the 618's opening ceremony, etc., to promote the activation and transformation of consumption potential. The financial report shows that Alibaba and Jingdong e-commerce both experienced negative revenue growth in the first quarter, while PDD delivered an excellent report card that both revenue and profit exceeded expectations. PDD core e-commerce advertising revenue of 27.2 billion yuan in the first quarter, * * year-on-year growth rate of up to 50%, far exceeding the expected 24.2 billion, * * and compared to the fourth quarter significantly faster. * * PDD's overall revenue growth in the first quarter was as high as 58%, exceeding market expectations. * * At the same time, PDD's marketing spending in response to the "10 billion subsidy" war launched by Jingdong in the first quarter and its marketing investment in Temu did not increase the company's marketing spending significantly as the market feared. In the first quarter, PDD's marketing expenses were 16.3 billion, with an expense rate of 43.2 per cent, down marginally from the previous quarter's 44.5 per cent, significantly below market expectations of a 48.6 per cent rate. In this way, PDD does not seem to feel the obvious competitive pressure, and the drag on Temu's investment is not as big as expected. Since the birth of "overseas PDD" Temu, the growth momentum has been even more rapid, and the heat has rapidly swept the world. Bloomberg Second Measure, after analyzing data on billions of credit and debit card transactions, pointed out that in May this year, Americans spent nearly 20% more on Temu than Shein. On the other hand, data Apptopia by the mobile APP research organization shows that in the six months after its launch, Temu has downloaded more than all shopping apps, and its participation and retention rate have also been in the United States. Ranked among the best in the iOS application list. Wall Street reported earlier, The early growth of platforms like Temu was largely driven by marketing spending. In January 2023 alone, Temu placed about 8900 advertisements on various Meta platforms to promote its ultra-low discount products, such as $5 necklaces, $4 shirts and $13 shoes. This constant "throwing money" [even helped Meta reverse the successive declines in performance in the first quarter of this year]. (https://wallstreetcn.com/articles/3687555) In addition to advertising, Temu has successfully replicated the social fission growth of its parent company PDD, gaining a large number of users by "cutting a knife". However, because Temu controls the right to check the price, the supplier is quite passive in the cooperation, and the price of supply is constantly lowered, so it is not easy to make money. Still, these concerns haven't stopped American shoppers from actively engaging in "chopping".! On Reddit, the American social forum, there are more and more posts about "cutting a knife".