With just over a month left until the bustling “618 Shopping Festival” of 2024, online shopping enthusiasts are undoubtedly sharpening their claws, ready to pounce and indulge in this annual extravaganza. This year’s shopping festival is different from the past, and the change consumers are most looking forward to is saying goodbye to the long presale period; direct on-hand sales will become the new norm!
It is reported that Taobao and Tmall have started the product registration for the 618 Shopping Festival, and made it clear that there will be no official presale phase this year. Relative to the presale model of previous years, this is undoubtedly a significant reform. After the cancellation of the presale phase, the first wave of sales will kick off at 8 p.m. on May 20th. Subsequently, the second wave of sales climax will arrive at 8 p.m. on May 31st.
During the 618 period, to attract consumers, Taobao and Tmall will implement a free shipping policy for goods, and provide shipping insurance to ensure all products are available from stock. At the same time, the prices of merchants’ products will be regulated to avoid situations of price increases followed by reductions. A series of measures indicates that the presale rules long implemented by Taobao and Tmall are about to exit the stage of history.
This year’s cancellation of the presale policy was not sudden; as early as the end of April, there were media reports that JD.com would also follow the “618 Shopping Festival” in calling off the presale measures. Although JD.com has not yet officially announced the specific plans, internal sources have revealed that adjustments to the 618 rules are in the making.
Looking back to the “Double 11 Shopping Festival” of 2023, JD.com was the first to abolish the presale mechanism, introducing promotional activities in the form of spot goods. Now, both Taobao Tmall and JD.com, two major e-commerce giants, have learned from each other, promoting innovation and reform in the entire e-commerce industry.
Regarding the cancellation of the presale mode, the general consumer group has shown unprecedented enthusiasm and satisfaction, exclaiming that this is a sign of entering a new era. The previous presale rules made consumers endure long waits for product shipments while vying with merchants for discounts, despite enjoying reduced prices. Now, it seems that these past inconveniences and anxieties will gradually fade away with the abolishment of the presale.
The presale mode has always been a warm-up before major sales events on e-commerce platforms, where merchants accept deposits through presales and consumers wait a long time after paying the final payment. This model helped merchants prepare inventory in advance and create momentum for the big promotion. Since Tmall first introduced the presale mode in 2014 for Double 11, it has become an indispensable marketing strategy. However, with social progress and changes in consumer demand, the presale mode is finally giving way to a more convenient direct sales mode.
Observing important milestones in the e-commerce industry, just as the Tmall platform’s 618 promotion this year has shown, the total sales of presale cosmetics reached approximately 8.59 billion yuan. Against the backdrop of the macroeconomic environment, this figure showcases Tmall’s robust performance. For merchants, the presale phase helped alleviate inventory pressure, but for consumers, it could mean longer waits and possibly products that are not ultimately the most cost-effective.
According to the data analysis released by the China Consumer Association, there are many problems with the presale model of e-commerce, such as price increases, unredeemed gifts, and false advertising, all of which need to be urgently standardized. In response to this situation, Taotian under Taobao has chosen to completely cancel the presale model, an action that demonstrates the platform’s resolve to improve user shopping experience and adopt a long-term development strategy. Although it may sacrifice short-term revenue, Taotian believes this will benefit consumers, thereby stimulating more consumption and achieving a win-win situation.
For consumers, it is difficult to determine whether they have actually grabbed the “lowest price” when participating in big promotions on e-commerce platforms, as some products may be subject to a “price hike followed by a reduction.” However, Taotian promises to control the “price hike followed by a reduction” on the platform, providing a full price protection service from payment to July 5, and will introduce measures such as free shipping and freight insurance in the future.
Although the cancellation of presale may pose greater challenges for the merchants, who need to manage their inventory more meticulously, thanks to the improved efficiency of logistics networks, most merchants are capable of stocking up and will not experience stockpile issues.
Taotian Group has announced that it will continue to lower prices, truly returning to the platform’s original intention. This has been implemented in practice, with Taobao 88VIP even launching an unlimited times free return shipping service, and during the “10 Billion Flash Sale Festival,” Taobao claims to offer an extra 30% off on top of the entire network. This is also a strategy to cope with competition from rivals, such as JD.com, which has already targeted Taotian’s prices and is determined to enhance competitiveness.
Without a doubt, Taotian’s low-price strategy is not an overnight effort. As early as the end of March, 1688 officially joined the Taobao platform, enhancing the price competitiveness of Taobao’s products and establishing Taobao’s brand image of low prices in the minds of users.
To attract more consumers and retain existing users, against the backdrop of other e-commerce platforms launching low-price strategies, Taobao and its parent company Alibaba Group are striving to create the allure of low-priced goods. Previously, Taobao renamed its year-end promotion “Taobao Year-End Good Price Festival,” aiming to establish its image of having a price advantage in consumers’ minds. On the other hand, Taobao is working hard to enhance the shopping experience for customers, such as promoting the topic of “refund only” service to trending search, which was likely influenced by similar practices of well-known competitors in the industry.
These efforts have already seen initial results. According to the latest research report from Huachuang Securities, as of March 2024, Taobao Tmall’s Gross Merchandise Volume (GMV) increased by 14% year on year, surpassing Pinduoduo’s 13% growth rate. The Monthly Active Users (MAU) reached 910 million, a 10% increase year on year, ranking first among e-commerce platforms. In tandem, Taobao Group is also steadily advancing the website upgrade reform, which is the complete overhaul of Taobao’s web version.
As reported by multiple media outlets, Taobao’s website manager Zhao Kun announced in an open letter the completion of an important upgrade to the Taobao website. The open letter pointed out that with the booming development of mobile internet, Taobao might have neglected the PC experience while enhancing the mobile user experience, leading to the accumulation of some issues, hence the decision to recruit a global “Taobao Web Think Tank” to solve these issues.
The reform of Taobao’s web version is not just some minor adjustments, but a complete rebirth. In the new overhaul, Taobao’s web version has added special areas like “Teahouse” and “Business Tips,” and has upgraded all aspects of product experience, goods, and content supply. For example, it improved the duration of login status and optimized the display of the shopping cart. It introduced the display of prices after discounts, automatic receipt of discounts in product details, and added invoice management features in “My Taobao.”
Since Alibaba proposed the “ALL IN Wireless” strategy in 2015, Taobao’s web traffic has significantly decreased, no longer as glorious as before. However, with the development of technology, especially the slowing trend of smartphones and the rise of AI technology, Taobao may realize that the future world will rely more on AI. Therefore, the rebirth of Taobao’s web version aims to create a brand-new user experience, using new technologies like video, livestreaming, 3D, XR, AI, etc., to make Taobao web shopping a new trend.
Having completed this important update to its web page at the age of 21, does it mean that Taobao will return to its original intent, to provide users with a more comfortable, modern online shopping experience? We wait and see.
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