World News

The latest News Of The World

How E-Commerce Is Making China’s Deflation Worse

Feed247:

Advertisement

SKIP ADVERTISEMENT

You have a preview view of this article while we are checking your access. When we have confirmed access, the full article content will load.

How E-Commerce Is Making China’s Deflation Worse

The push by Pinduoduo to lower prices has helped it become one of China’s fastest-growing e-commerce apps, and epitomizes a broader force plaguing the economy.

Listen to this article · 7:49 minLearn more
A building with glass windows and a red and white logo in the shape of a heart.
Founded in 2015, Pinduoduo has grown more quickly than its more established rivals. Credit…Askar Karimullin/Alamy

Daisuke Wakabayashi and Claire Fu

Oct. 7, 2024
阅读简体中文版閱讀繁體中文版

When Lin Yunyun started selling diapers two years ago on Pinduoduo, China’s fast-growing e-commerce site, she was not prepared for the relentless nagging about prices.

Pinduoduo, popular among Chinese consumers for its discounts, sent “reminders” whenever other sellers dropped their prices below hers. When Ms. Lin cut her prices, the site would temporarily promote her products — only to warn her a few days later that more reductions were needed for the site to continue driving customers to her goods.

“The platform keeps reminding me to lower prices,” said Ms. Lin, 28, who lives in Zhangzhou, a city in southeastern China. “If I cut my price any more, I won’t make any money.”

No company embodies China’s deflationary moment quite like Pinduoduo. Shoppers flock to the app for its staggering discounts, the result of its unyielding push to lower prices. As the country’s second-largest online retailer, it is the shopping destination of choice for those who embrace so-called downgraded spending — a social-media fueled maxim of Chinese consumers’ penny-pinching ways.

Rattled by a real estate crisis with no end in sight and a faltering labor market, Chinese consumers are spending less and saving more. Prices are falling, and profits are shrinking. Companies are hesitant to hire more workers or invest in the future, fueling even more concerns about the economy.

Image
Despite hints of additional fiscal spending to put more money into the hands of Chinese consumers, the government has not revealed any specific plans.Credit…Qilai Shen for The New York Times

We are having trouble retrieving the article content.

Please enable JavaScript in your browser settings.


Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.


Thank you for your patience while we verify access.

Already a subscriber? Log in.

Want all of The Times? Subscribe.

Advertisement

SKIP ADVERTISEMENT

Source: https://www.nytimes.com