Taobao and Tmall Group, an e-commerce platform owned by BABA-SW (09988.HK) +2.950 (+3.910%) Short selling $567.74M; Ratio 11.081% (BABA.US) , held a closed-door meeting with merchants after the 618 Shopping Festival, Chinese news broke. The meeting confirmed that there will be changes to the sales strategy in 2H24, including Taobao's adjustment of its pricing strategy, which will no longer emphasize "five-star pricing".
Since last year, Taobao's search weight allocation system has been reportedly adjusted from "five-star pricing" to allocation based on GMV. In 1H24, the "five-star pricing" for many categories of products was progressively eliminated. In the future, Taobao will no longer use the "five-star pricing" as a uniform standard for all merchants, but will allow suitable and willing merchants to participate.
"Five-star pricing" is a pricing evaluation system launched by Taobao. The system gives a 1-5 star rating based on the prices of the same product inside and outside Taobao to determine the price competitiveness of the product in the market. Under this system, the lower the price of a product, the higher the traffic it receives.
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