JD's procurement and sales have become JD's second marketing and public relations department, in order to shout and challenge colleagues in the market, and win more consumer attention for themselves.
On the afternoon of January 17th, JD.com claimed during the live broadcast that Pinduoduo had blocked the IP (network address) of JD.com headquarters, causing it to be unable to view the prices of Pinduoduo products and thus unable to compare prices in real time to benefit consumers. During the live broadcast, JD's sales team shouted to Pinduoduo, "Please stop blocking IP and infringing on consumer rights, and kindly ask Pinduoduo to directly compare prices."
On the evening of January 17th, following the shouting, the background of the live broadcast room for purchasing and selling household appliances and furniture on JD.com was directly marked with the slogan "Please stop blocking Pinduoduo and compare prices directly". This is exactly the same as in the competition for the lowest price on the entire network with Li Jiaqi's live broadcast room. At that time, JD's sales promotion was based on the slogan "no pit fees, no expert commissions, so it is cheaper than Li Jiaqi's live broadcast room".
After anchoring two low-priced mental platforms, JD's sales live streaming room took advantage of the situation to attract more natural traffic, consolidating its own platform's lower prices in the battle.
As the department leading JD's self operated development, the procurement and sales team has become the biggest highlight of JD's development in the past six months. During the Double 11 War, JD.com's procurement and sales department established a development direction for JD.com Live, being the only department to receive salary recognition from the company. However, their continuous efforts to engage in verbal battles with competitors have proven that:
Behind the "never lying flat" changes in JD's procurement and sales, it reflects a shift in JD's low price strategy: the low price effect brought by relying on third-party merchants to enrich supply is not direct, and increasing self operation and squeezing the moisture of the supply chain will have a more direct effect.
JD Sales is looking for traffic passwords, looking forward to their "Dong Yuhui"
A Pinduoduo staff member said to Blue Whale Finance after seeing the news of JD shouting, "JD is doing something. If you really want to compare prices, there are actually ways, such as using 5G network.". Some users also pointed out in relevant comments that this can only indicate that JD's technology work is not very good.
It is not uncommon for competitors to block each other's network addresses and IPs. In December 2023, an Alibaba employee went to the Hema headquarters for a meeting and found that they could not use the Sam's Club app, questioning whether the Hema headquarters IP address was blocked by Sam.
But in the incident where JD.com questioned Pinduoduo, the purchasing and sales side of JD.com used the slogan "earnestly stop blocking IP and infringing on consumer rights". This Pinduoduo employee believed that "the hat of infringing on consumer rights is too big, and the public relations department may not be willing to accept it".
This incident can be seen as JD.com's "old trick" after the battle against Li Jiaqi, with the intention of anchoring two e-commerce platforms that already have strong and low-priced user minds, and using lower product prices to solidify their low-priced minds in the competition. And more importantly, it has gained user traffic in a larger public opinion.
This is how JD's sales live streaming room started. In the battle with Li Jiaqi, the procurement and sales room became JD's biggest highlight in the 2023 Double 11. The official battle report shows that the unique "no commission, no pit fee, no tricks" three no live streaming mode, during the Double 11 period, the number of viewers reached 380 million, and the number of products sold exceeded 3 million.
Subsequently, during the New Year's Eve period, JD's sales live broadcast room chose to interact with Hunan TV Mango TV, which was exclusively named by JD. Within 5 hours, the overall viewership exceeded 100 million and the order volume was nearly 400000.
To summarize the formation path of most top stream live streaming rooms, two essential factors are "the lowest price on the entire network" and "the style of live streaming room persona". JD's live streaming room persona is "no commission, no pit fee, and no tricks", but this does not point to the consumer side, it is still a manifestation of low prices in live streaming rooms. Therefore, during the development process of these two months, the lack of strong emotional connections brought about by personas has always been a hidden concern in criticizing the long-term vitality of JD's procurement and sales.
From the logic behind this call to Pinduoduo, it can still be seen that JD's sales team is using verbal warfare to continue expanding user traffic in the live broadcast room. On the evening of the 17th, a reporter from Blue Whale Finance observed a JD furniture and home appliance purchasing and sales room with the message "Please stop blocking direct price comparison on Pinduoduo", and the number of viewers exceeded 2 million at one point.
One is that the JD sales live broadcast room has supported JD's sales promotion in the battle, and the other is that JD's sales personnel roles are also changing, from traditional sales personnel to sales anchors. An insider from JD.com previously told Blue Whale Finance that sales personnel will bring high-quality cost-effective products they have negotiated to the live broadcast room, meaning that those who personally enter the live broadcast room are sales personnel. Therefore, from these two logics, it can be understood that JD.com previously claimed a significant salary increase for its procurement and sales personnel.
Previously, JD.com announced that starting from January 1, 2024, all online business personnel of JD.com Retail will receive a fixed annual bonus of four times their monthly salary, including their original monthly performance-based salary and floating year-end bonus. After the adjustment, the annual fixed salary will increase by nearly 100%. In addition, the business boss unit can receive an uncapped performance incentive by providing performance improvement based on the year-on-year improvement rate.
It is reported that JD's business boss unit is a newly established organizational form in April 2023, which eliminates the level of business groups and establishes a minimum unit under the "big boss system". Each boss unit has several sales managers and sales personnel.
It can be seen that the performance incentive for the business boss unit that is not capped is actually equivalent to the reward for super top anchors in the live broadcast room. After completing the first stage of establishing the mentality of low-priced users in JD's sales live broadcast room, of course, there is also an urgent need for the birth of super top stream anchors, waiting for their own "Dong Yuhui".
Behind the Ace of Purchasing and Selling, JD's Transformation of Low Price Strategy
Unlike in the previous Li Jiaqi incident, JD.com perfectly borrowed the dissatisfaction of the public towards the super head anchor in its procurement and sales. This time, JD.com's proactive challenge against Pinduoduo has made public opinion more diverse. One viewpoint is, "You don't need to compete with Pinduoduo to directly offer the lowest price." Another viewpoint is, "I may not buy JD for the lowest price on the entire network, but for better service.".
The previous statement pointed to the current consumer tendency of users to buy wherever it is cheaper. In fact, a reporter from Blue Whale Finance saw in the shopping list of the furniture and home appliance live broadcast room on the evening of the 17th that taking the top two models as examples: the Apple iPhone 15 (A3092) 128G/4949 yuan, and the Apple iPhone 15 (A3092) 256G/5949 yuan, will still be about 200 yuan cheaper on Pinduoduo.
LatePost previously wrote that Pinduoduo is more focused on "finding goods from the brand's offline dealer network and various product circulation channels", and is cooperating with greater subsidies of billions of yuan, resulting in some 3C products having the lowest prices on the entire network. This is also what makes JD.com, which has always maintained the best quality service and strongest competitiveness in 3C products, unhappy.
Another mainstream user sentiment of "buying JD for better service" can be seen on the one hand as JD's quality service still deeply ingrained in people's hearts, which is still its strongest competitiveness. Although Pinduoduo has leveraged the habit of users comparing prices for 3C products across the internet, JD's quality products and express delivery services that have been maintained for many years still make many users willing to pay for a portion of the premium.
But another meaning is that some audiences believe that simply comparing low prices is not JD's advantage.
Previously, JD.com also emphasized that the then CEO of JD.com, Xin Lijun, stated at the 2023 Double 11 launch meeting that "the low prices that JD.com has always advocated are not fake low prices obtained by passing off substandard goods, lacking weight, or deceiving others. Instead, they rely on honest management to continuously squeeze water into the supply chain, and pass on the money saved through extreme efficiency to users and partners, which can truly promote consumption and stimulate the vitality of the consumer market as a 'true low price'.".
The mainstream of the war surrounding e-commerce throughout 2023 will be "low prices". However, based on the growth history and development context of each company, the methods and strategies of rolling low prices are not the same. To sum up, Pinduoduo and Tiktok E-commerce follow the logic of low price single product explosion, especially Pinduoduo perfectly gives more traffic to the same type of low price products, so that the factory side keeps rolling in. The logic of Tiktok is that users will launch a series of lower price products of the same type after placing an order.
Taobao, which has the richest supply on the entire network, revolves around the "supply, traffic, and mechanism" model in terms of pricing power: enriching the low-priced supply ecosystem - enhancing Taobao's internal traffic - matching low-priced supply with abundant traffic, and exchanging low-priced goods for large-scale sales, promoting a low-priced circulation system.
Previously, when JD.com designated "low price as the only fundamental weapon", a major policy strategy was to attract and enrich third-party merchants on the platform, compete reasonably with self operated products for traffic on the platform, and thereby achieve low prices for goods. However, JD's ability to attract small and medium-sized businesses requires a longer period of time to settle, and the weakness of on-site traffic is a disadvantage that it is difficult to make up for at the moment.
In fact, more importantly, vigorously developing third-party merchants means that JD's self operated "power" will be gradually reduced. From the current perspective, whether it is giving a salary increase to the self operated procurement and sales team, or the current active combat effectiveness of the procurement and sales team, all prove that JD's low price strategy needs to rely on self operation to complete: continuously squeezing water in the supply chain.
Moreover, JD.com needs to find more "sales live streaming room" models in its low price strategy.