Freight insurance and low prices are adjusted, and e-commerce is accelerating its return to commercial rationality

As the e-commerce industry develops rapidly, issues such as freight insurance and refund-only policies have gradually become the focus of conflicts between merchants and consumers. How can the platform find a balance between protecting consumer rights and alleviating the burden on merchants? The latest policy adjustments of Taobao and Tmall may give us some inspiration.

Break the vicious cycle and return to business rationality.

Recently, according to a report from the E-Commerce News, in response to the increase in after-sales service costs in the e-commerce industry this year, Taobao will comprehensively optimize its current freight insurance strategy in the near future.

According to sources, Taobao and Tmall have held several rounds of consultations with their partners on the issue of freight insurance, and some subsidy strategies are expected to be put into trial operation in September this year. In addition, Taobao has also "loosened" another cost problem that merchants are concerned about, "refund only", through a number of new policies.

Taobao and Tmall adjusted their freight insurance and refund-only policies, which can be said to be timely. This is because freight insurance has become a prominent problem that has troubled the entire e-commerce industry since this year. Although the original intention was to reduce the conflicts and financial losses that may exist in the return process and help improve the consumer experience, it was unexpectedly used by some "black and gray industries" to damage the interests of some normal business operators.

From the platform's perspective, on the one hand, it is necessary to protect and enhance consumer experience; on the other hand, it is necessary to help merchants reduce operating costs and maintain fairness on the merchant side. Between the two, "the most important thing is to achieve a balance."

There is no doubt that this is an industry challenge involving all parties, and it is also a difficult but correct thing to do. Furthermore, the e-commerce industry needs to optimize the relationship between consumers and merchants, accelerate the return to commercial rationality, and find an ideal balance point.

01 The relationship between consumers and merchants needs to be optimized

Objectively speaking, in the current consumption environment, the relationship between consumers and businesses has become somewhat tense, and because of this tense relationship, some "black and gray industries" cannot escape responsibility.

Take freight insurance as an example. Its original intention was good, but it was targeted by criminals and exploited, and even became a "magic weapon" for "getting rich."

According to media observations, recently, not only has the topic of "freight insurance being turned into a business" become a hot search, but judicial authorities in many places have also announced cases of freight insurance fraud, and the suspects have been sentenced according to law.

For example, in April this year, the Public Security Bureau of Xintian County, Yongzhou City, Hunan Province received a report from an e-commerce platform, saying that someone was defrauding freight insurance by means of false shopping returns.

When the Xintian County Public Security Bureau arrested the criminal gang, it seized 14 computers and printers, more than 300 mobile phones, more than 400 mobile phone cards, and more than 90 business licenses for registering online stores without sources of goods. Since the second half of 2023, this gang has divided the work and cooperated to defraud more than 700,000 yuan in freight insurance by placing false orders online and refusing to accept goods with freight insurance after purchasing them.

In addition to freight insurance, the "refund only" policy is also targeted.

Simply put, the "refund only" policy was originally intended to protect the rights of consumers, but it was exploited by some people to frantically "get the free goods". There were even "refund only" tutorials on the Internet, and the "free goods party" quickly developed into a black industry chain. From a few yuan to hundreds of yuan, they took advantage of loopholes in the rules to "get the free goods in an organized and premeditated manner."

Moreover, the "refund only" wool party is not satisfied with a certain platform, but moves around on various platforms, like one "whirlwind" after another, impacting the normal operation of merchants.

Zhao Yong, a Shandong businessman, had encountered the above situation. Previously, a customer bought a pair of shoes in his store and said that the shoes had defects and asked him to pay a sum of cash as compensation. In fact, his store not only provides free shipping, but also provides shipping insurance. If the shoes have defects, customers can choose to return them for a refund. However, when he asked the customer to return the shoes, he was rejected by the customer - "I just want money", otherwise he would bring people to "destroy" Zhao Yong's store.

After failing to get the money back, the customer used different accounts to buy more than ten pairs of shoes and applied for "product defect refund" for all of them. This not only caused Zhao Yong's business interests to be damaged, but also caused the store's rating to plummet.

The destructive power of malicious "refund only" is evident. Not only Zhao Yong, but a large number of merchants have been impacted and their normal operations have been deeply affected. Some have been forced to close their stores under the onslaught of a large number of "refund only" orders.

It is worth mentioning that in the previous period of time, in the fierce market competition, the e-commerce industry has been selling low prices across the board. Excessively low prices inevitably led to the deterioration of the quality of some products, resulting in a high return rate, and objectively increased the operating costs of merchants.

When we combine freight insurance, refund only and price factors, we will find that these problems are intertwined, exacerbating conflicts and forming a vicious cycle between consumers and merchants. In the view of Yilan Business, in the long run, the ecology of the e-commerce industry will be destroyed, which undoubtedly needs to be curbed with all efforts.

In other words, it's time to break the vicious cycle and optimize the relationship between consumers and merchants.

02 To find the ideal balance point, we must return to business rationality

The key to optimizing the relationship between consumers and merchants is to adopt a multi-pronged approach. Judging from the reality of the industry, multiple platforms have already made adjustments at different levels.

Let’s look at the price first.

Recently, Douyin E-Commerce held an internal communication meeting for all employees in Beijing. In addition to emphasizing the need to improve services and consumer experience, relevant executives also stated that they would not pursue absolutely low prices.

Taobao and Tmall announced a strategy adjustment as early as after the 618 promotion, no longer emphasizing the absolute low-price strategy. This means that Taobao and Tmall will pay more attention to product quality and service, rather than just price competition.

Yesterday, LatePost revealed that Pinduoduo has followed Taobao Tmall and Douyin in making GMV its first priority, and its pursuit of extremely low prices is likely to be weakened and balanced by other factors.

See "Refund only" again.

Taobao has taken the lead in the industry to announce the optimization of this policy and launched a new experience point system, which mainly covers "store experience points" and "product experience points", and completely replaces the previous DSR (Taobao's previous seller service evaluation system).

In this way, merchants will gain more and fuller after-sales autonomy, and as a platform, during the after-sales process, Taobao will reduce or cancel after-sales intervention for high-quality stores based on experience points.

Specifically, for merchants with a comprehensive store experience score of ≥4.8, Taobao will not actively intervene through Wangwang to support "refund only" after receiving the goods, but will encourage merchants to negotiate with consumers first. For merchants with other experience score segments, Taobao will grant different degrees of autonomy based on the experience score and industry nature.

At the same time, after the merchant initiates a "refund only" complaint, Taobao will ask a third-party testing agency to conduct random inspections on the products. If the inspection passes, Taobao will compensate the merchant for the losses.

Obviously, the higher the merchant experience score, the better the service, and thus the more room for independent decision-making on after-sales service, thus avoiding the freeloaders of "wool parties". In addition, by providing evidence, it is also possible to effectively counter the malicious "refund only".

Taobao optimizes "refund only", while Tmall completely cancels annual fees. It is reported that starting from September 1, Tmall will cancel the annual software service fee of the platform: new merchants entering from September do not need to pay; for merchants who have already paid the annual fee, Tmall will refund them in batches according to the settlement rules.

Previously, merchants in different categories on Tmall had to pay an annual fee of 30,000 to 60,000 yuan. After the exemption, new merchants who join Tmall after September 1 this year will no longer need to pay this fee. At the same time, Tmall will fully refund the annual fee for merchants whose operating turnover from January to August this year reaches the annual target.

In addition to Taobao, Pinduoduo has also recently announced that the platform will modify its unreasonable refund-only rule through operational measures. An e-commerce blogger said that if Pinduoduo merchants reject refund-only applications within 36 hours, the platform will not intervene.

Finally, look at freight insurance.

According to sources, Taobao will comprehensively optimize its current freight insurance strategy. Although the details of the strategy have not yet been finalized, it is certain that after this round of strategy adjustments, Taobao and Tmall merchants are expected to receive more freight insurance-related subsidies and further reduce operating costs.

Not only that, Taobao will also work with partners to launch more normalized freight insurance subsidy policies in more industries to systematically solve the current problem of high freight insurance costs.

Taobao will also further intensify its crackdown on the "black and gray industry" of freight insurance fraud. Taobao insiders revealed that Taobao Tmall has previously joined forces with partners and the police to focus on cracking down on gangs in Maoming, Guangdong, Pingxiang, Jiangxi and other regions who commit insurance fraud. Among them, the suspect in the Jiangxi case has been arrested and a case has been filed in Guangdong.

By addressing issues such as freight insurance, refund-only and price wars one by one, Yilan Business believes that this will firstly help break the vicious cycle, and secondly, help optimize the relationship between consumers and merchants, and jointly build and share a healthy industry ecology.

From the underlying logic, the essence of business is value exchange. It is not just a one-time value exchange, but also includes establishing long-term relationships and maintaining, developing and consolidating such relationships through continuous value exchange.

In other words, the fundamental starting point and end point of adjusting the relationship between consumers and merchants on multiple platforms is to maintain, develop, and consolidate long-term value exchange. This requires addressing the aforementioned problems, breaking the vicious cycle, and returning to business rationality. Only in this way can we find the ideal balance point between consumers and merchants.

According to Yilan Business, the adjustment of platforms, changes in the consumer and merchant sides are accelerating, and the industry will become more rational and healthier. It can be foreseen that this will gather new momentum, reshape the industry ecology, and explore the realization of a true win-win value.

Author | Bandit