Workers pose for photos near a display for the annual Singles’ Day online retail extravaganza at the headquarters of ecommerce platform JD.com in Beijing, on Nov 11, 2023. JD and Alibaba have long been the leaders in China’s ecommerce arena, but have rapidly ceded ground to up-and-comers from PDD Holdings Inc to ByteDance Ltd’s Douyin. — AP
JD.com Inc founder Richard Liu urged staff to address deep-seated issues within his ecommerce company, in an internal memo that echoed a call to arms issued by Alibaba Group Holding Ltd founder Jack Ma last month.
Liu was responding to an employee’s post on a JD.com forum over the weekend, in much the same way Ma addressed and amplified an Alibaba staffer’s views about rising competition. The unidentified employee listed a litany of problems from poor merchant support to an overly pricey item list, according to a person familiar with the message thread. The JD founder, apologising for typing while in a car, agreed with that assessment and called for change.
“I feel our brother has said it all too well,” Liu wrote in comments confirmed by the person, who asked not to be identified discussing company messages. “Every word hit upon the company’s pain points, they’re all existing problems. We need to change, or there’s no way out for our company.”
JD and Alibaba have long been the leaders in China’s ecommerce arena, but have rapidly ceded ground to up-and-comers from PDD Holdings Inc to ByteDance Ltd’s Douyin. JD’s shares have slid more than 50% this year, outstripping Alibaba’s roughly 19% decline and a far cry from PDD’s 75% rally.
This month, eight-year-old PDD surpassed Alibaba in market value for the first time to become China’s most valuable ecommerce firm – a wake-up call for the twin incumbents of the country’s online retail arena.
Ma, the once outspoken billionaire who faded out of the spotlight after Beijing targeted Alibaba in an anti-monopoly investigation, broke his silence in November to urge corrective action while lauding Temu-owner PDD.
JD.com is adopting discounts and lower prices to try and turn the tide at a time consumers are cutting back on big-ticket spending. But growth remains anaemic as China struggles with an uncertain post-Covid recovery.
“We often say that in battles we should only be the first, but we have always been defensive and never think about how to take the initiative!” Liu wrote. – Bloomberg
