Last night, according to friends in the e-commerce industry, Taobao is gradually abandoning the strategy of absolute low prices. What is absolute low price? Simply put, it means price dominance. For example, whoever has the lower price gets the traffic. Even quality and service can be sacrificed for the sake of price. Or, profits can be sacrificed to gain larger scale through low prices. Clearly, this is not what Alibaba wants.

By abandoning absolute low prices, Taobao will focus on three other metrics: 1) consumer experience, 2) average spending amount, and 3) high-value user retention. It will even change the underlying logic of traffic allocation, linking future product traffic to consumer experience. Previously, whoever had the lowest price got the traffic. Now, whoever provides the best experience will receive the traffic.

Alibaba is just one example. When JD.com disclosed its first-quarter results earlier, it no longer emphasized pure low prices but instead began focusing on service and consumption frequency. Service needs no further explanation—JD.com has been investing heavily in logistics, and its delivery times are now measured in hours. Additionally, JD.com now offers three home visits for appliance purchases, which is incredible. Consumption frequency is the second key metric JD.com is prioritizing—simply put, it measures how often you shop on JD.com.$Alibaba(BABA.US)$JD.com(JD.US)$PDD(PDD.US)