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Alibaba and JD in a Tussle after Alibaba force Vendors to pick Side for Singles Day Sale

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Published on : Nov 04, 2015

In China, the biggest online shopping holiday is right at the corner. In the bid to cater to consumers for this special online shopping festival, as the two biggest etailers in China, Alibaba and JD are gearing up, the competition is getting ugly. 

As stated by JD, this year Alibaba is pressurizing apparel merchants to either select Tmall, which is the apparel retail site of Alibaba, or JD to participate in the Singles Day sales. These merchants are not allowed to participate in sales for the occasion through both the etailers. 

In this regard, JD has filed a report with the State Administration of Industry and Commerce (SAIC ) of China requesting a formal investigation into the matter. According to JD’S plea, Alibaba has instructed numerous vendors that if they participate on the Singles Day sale through both platforms, this will be a punishment for Tmall in the form of reduced traffic and low ranking.

Further JD made the argument that this move is not in the interest of consumers, as it denies users to have access to the best deals. As further stated by a JD pressurizing brands that does not allow them to participate in promotions sets limits for both brands as well as consumers. This also clearly represents violation of laws in China, as added by JD representative.

In this context, the commerce authorities in China have not yet responded to JD’plea. On the other hand, Alibaba is unrepentant about its action. As stated by a top executive of Alibaba, JD is panicking with fears of losing, JD does not have the capability to match the merchant and customer experience of Alibaba  and also the logistical scale of Alibaba due to superior experience on the company’s platforms. On JD’S part, it feels that Alibaba feels threatened by the fast growth of JD in the apparel sector.

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