Liu Cheng/Wen

This year's Singles' Day has reached its 18th year and has been referred to as the 'coming of age ceremony' by some industry commentators.

This statement is more symbolic: it indicates that "Double 11" has entered a mature stage that emphasizes brand management, service experience, and long-term value, rather than relying solely on low prices, bulk orders, and GMV (Gross Merchandise Volume) to drive sales during the early days. In the past, the core indicator of "Double 11" was transaction volume; Nowadays, platforms, merchants, and regulators are all re examining: e-commerce growth cannot solely rely on "price wars", and brand, quality, service, and innovation must become new growth pillars.

The 'coming of age' of 'Double 11' does not mean that the promotion itself has ended, but rather that it must face a more complex competitive environment, stricter regulatory requirements, more rational consumers, and more sustainable business logic.

Price Failure of Platform Economy

Traditional economics usually starts from static equilibrium, assuming that prices can fully reflect the quality, scarcity, and supply-demand relationship of goods. In an ideal state, price is both a signal for resource allocation and a basis for consumers to judge value.

But in the platform economy, the price mechanism has not naturally achieved "high quality and good price". The platform amplifies price signals to unprecedented strength through big data, algorithms, and traffic allocation. Consumers are more likely to see low-priced products in search, recommendation, and comparison, and businesses are also forced into price competition under mechanisms such as "lowest price across the internet" and "automatic price matching".

This kind of competition may seem beneficial to consumers on the surface, but in the long run, it may weaken market efficiency.

Excessive low prices can compress brand profits, reduce R&D investment, and even trigger problems such as selling inferior products as good, false advertising, and increased return rates. When platform traffic excessively tilts towards low-priced products, dimensions such as quality, reputation, after-sales service, and brand value are easily overlooked, and high-quality supply is difficult to obtain the expected returns.

Nobel laureate economist Agion once pointed out that innovation needs to be based on necessary profits, and if market competition compresses profits to near zero, innovation incentives will also be weakened.

The problem with platform economy is not the price mechanism itself, but rather that algorithms and traffic allocation may make price signals overly prominent and quality signals relatively insufficient, resulting in price failure. Consumers find it difficult to judge differences in product craftsmanship, materials, durability, and after-sales service solely based on page information, and businesses also find it difficult to obtain stable premiums through quality differences. So, competition slid from "winning by quality" to "winning by price", forming a cycle of low profit, low quality, and low innovation. This is one of the important causes of the "internal competition" in e-commerce in recent years.

In fact, the mechanisms driven by platform algorithms such as "lowest price across the entire network" and "automatic price matching" have exposed the squeeze on the independent pricing power of merchants and the distortion of the benign competitive order.

Previously, when the regulatory authorities investigated and dealt with related platform monopoly cases, they pointed out that some platforms use intelligent pricing algorithms and traffic reward and punishment mechanisms to force merchants to passively lower prices, reducing competition to a zero sum game around the price bottom line. This competitive approach not only damages the reasonable profits of businesses, but may also weaken consumers' trust in quality and service.

The deeper problem is that price competition in the platform economy is often not based on cost advantages, but on traffic distribution advantages. Whoever can obtain lower traffic costs, stronger algorithm recommendations, and higher subsidy support may gain sales advantages in the short term. But this advantage does not necessarily come from product innovation or management efficiency, but may come from platform rules, capital subsidies, and algorithm preferences. If this continues for a long time, the e-commerce market will slide from "efficiency competition" to "subsidy competition", and from "quality competition" to "traffic competition".

Meanwhile, low price competition can also bring significant negative externalities. In order to maintain low prices, some merchants may compress packaging, logistics, after-sales, and quality inspection costs, and even create a "cost-effectiveness illusion" through brushing orders, false evaluations, exaggerated advertising, and other methods. Consumers may appear to have received short-term discounts, but they may bear higher costs of returns, exchanges, time, and trust. The platform may seem to have gained traffic and transaction volume, but it may overdraw long-term reputation. Merchants may appear to have achieved sales, but they may find themselves in a predicament of thin profits, insufficient repeat purchases, and difficulty in establishing their brand.

Policy callback for brand building

Faced with the quality risks and competition distortions brought about by "low price competition", a systematic policy correction has begun. In September 2026, the Ministry of Commerce and seven other departments jointly issued the "Notice on Implementing the 'Five Excellence' Action for Quality E-commerce '", which clearly requires e-commerce platforms to optimize product display, recommendation, and marketing activity mechanisms, strengthen product quality, service reputation, credit information and other quality oriented measures, and rectify disorderly competition behaviors such as "automatic price matching" and "lowest price across the entire network".

This means that platforms can no longer simply use low prices as the sole criterion for traffic allocation, but should incorporate quality, credit, after-sales service, and consumer satisfaction into their evaluation system. For merchants, this provides a more stable institutional environment for brand management; It also helps consumers reduce the cost of choice brought about by "bad money driving out good money".

It is worth noting that the policy level has made arrangements for China-Chic's domestic products and historical classic industries, and is committed to improving the brand of domestic products. In August 2026, the Ministry of Industry and Information Technology and six other departments issued the "Opinions on Promoting the High Quality Development of Historical Classic Industries", which for the first time systematically supported the development of industries such as silk, tea, porcelain, traditional Chinese medicine, brewing, arts and crafts, and the Four Treasures of the Study at the national level. It explicitly proposed to shape 100 Chinese consumer goods by 2028 and encouraged the use of new channels such as e-commerce, live streaming, and short videos to tell the stories of classic industries and drive sales. The Ministry of Commerce has also proposed to promote the coordinated linkage between time-honored brands and historical classic industries, and support classic products to enter key commercial districts, ports, duty-free shops, high-end supermarkets, and e-commerce platforms in the city.

At the same time, the platform is actively adjusting its business logic and aligning more closely with the supply of domestic products, time-honored brands, intangible cultural heritage, and county-level industrial belts. During the "Double 11" period in 2026, Tmall will cancel cross store full discounts and switch to official discounts. Taobao factories and domestic products will strictly select and provide commission refunds, exclusive logos, operational support, and AI studios for industry belt flagship factories, time-honored brands, original designs, and specialized new merchants; JD.com continues the official direct reduction and relies on the "Light of Domestic Products" plan, time-honored brand hall, China Landmark Hall, and Agricultural Assistance Hall to provide long-term business channels for domestic brands, regional landmark products, and time-honored brands; Tiktok e-commerce focuses on immediate discounts and one piece direct discounts, and supports small and medium-sized businesses, intangible cultural heritage businesses and industry belt businesses through layered traffic incentives, consumer voucher subsidies and AI tools.

These changes help reduce transaction friction caused by bundling orders, refunds, and price packaging, making it easier for time-honored brands, intangible cultural heritage products, and county-level industrial belts to generate revenue through product strength, new product strength, and membership operations, rather than relying solely on extreme low prices for short-term sales.

From a deeper perspective, policy correction is not simply a denial of price competition, but an attempt to rebuild the price formation mechanism of the e-commerce market. When quality, service, credit, and brand value can be identified, evaluated, and rewarded, price can once again become a signal reflecting true value, rather than a single competitive tool distorted by algorithms and subsidies. The policy correction of brand building is essentially aimed at correcting the incentive structure of "excessive price and weak quality" in the platform economy.

This callback also reflects the transformation of e-commerce governance from "post punishment" to "pre rule design". In the past, regulation focused more on cracking down on false advertising, price fraud, and fake orders and letters; Now, rule design is delving deeper into areas such as recommendation algorithms, traffic allocation, pricing mechanisms, and merchant rights protection. Platforms are no longer just transaction matchmakers, but are increasingly becoming maintainers of market order.

Positive competition between brand building and low price promotion

The "Double 11" in 2026 presents a parallel of two forces: on the one hand, price competition still exists; On the other hand, brand, quality, and service are gaining more weight.

From the price perspective, there has been a significant decrease in the number of full reduction orders. Tmall cancels cross store full discounts and adopts official discounts, with a maximum discount of 15%; JD.com continues its official direct decline; Tiktok also focuses on single piece drop. This reduces the computational cost for consumers, as well as the occurrence of invalid orders and high return rates due to bundling. But the 'price war' has not completely disappeared, and platforms still maintain price competitiveness through red envelopes, membership coupons, billions of subsidies, and national subsidies. Consumers still need to be wary of price packaging such as "rising first and then falling" and "artificially high line prices".

From the brand perspective, the platform is supporting high-quality supply through various mechanisms.

Tmall emphasizes the keywords of AI and flagship stores this year, promoting brands to use AI to insight consumer trends, operate member assets, and launch a large number of super items and flagship store limited edition products during the "Double 11" period. According to a survey conducted in 2026, 79.4% of consumers consult AI tools before shopping, and the influence of AI on consumer decisions reaches 43.7%, surpassing traditional media advertising's 42.6% for the first time.

JD.com has increased its service consumption by incorporating household services, elderly care, pet services, car repairs, and other services into its promotional system, attempting to strengthen brand trust through its ability to fulfill obligations and service standards.

Tiktok e-commerce reduces the operating threshold of small and medium-sized brands through AI shopping guide, intelligent customer service and traffic incentive. These actions indicate that the platform is shifting from "selling cheap goods" to "managing brands, users, and services".

More noteworthy is that AI is becoming a new tool for brand competition. In the past, merchants relied on manual research, product testing, and advertising; Nowadays, AI can assist in trend insight, crowd recognition, product image generation, customer service response, and inventory management. Tmall launches AI shopping assistant, JD.com launches AI management tools and digital human anchors, and some large model manufacturers also join e-commerce platforms, making AI services a new consumer category. This does not mean that AI can replace product quality, but it does reduce the cost of brand discovery needs, validating new products, and enhancing services.

At the same time, service consumption has also become an important carrier for brand building. Durable consumer goods such as home appliances and digital devices are no longer just competing on price, but also on installation, maintenance, extended warranty, trade in, and after-sales response. The platform's inclusion of services in the big promotion means that the competitive dimension is expanding from "low-priced goods" to "full cycle experience". For brands, service experience itself is a part of brand assets; For platforms, service capability is also the key to distinguishing between low-priced platforms and quality platforms.

Moving towards mature e-commerce: from "price war" to quality competition

The 'coming of age' of Double 11 does not mean that price competition has disappeared, but rather that e-commerce development can no longer be driven solely by low prices. A mature e-commerce market should allow price, quality, brand, service, and technology to work together.

Firstly, the platform needs to improve its traffic allocation mechanism to give higher weight to quality, reputation, after-sales, and credit information, in order to avoid algorithms locking merchants in low-priced competition. Platforms should not only pursue short-term conversions, but also bear the responsibility of maintaining market order, protecting consumer rights, and supporting high-quality supply.

Secondly, brands should shift their focus from short-term promotions to long-term user assets, and obtain reasonable premiums through new product development, membership operations, and supply chain capabilities enhancement. Brand premium is not a price increase detached from value, but a return on research and development, design, quality, service, and trust.

Once again, regulation should continue to crack down on false advertising, fake orders, automatic price matching, and kidnapping at the lowest price, in order to maintain a fair competition order. Finally, consumers also need to establish more rational purchasing habits, not only focusing on the actual price, but also on product quality, after-sales support, and long-term user experience.

In the future, the key to e-commerce competition will no longer be 'who is cheaper', but 'who can sustainably provide valuable goods and services'. When platforms, merchants, regulators, and consumers jointly promote quality orientation, "Double 11" will no longer be a price carnival, but an important window to observe the growth of Chinese brands, consumer upgrades, and the maturity of digital commerce.

It should be noted that promoting "high quality and high price" does not mean encouraging all products to increase in price, nor does it mean making prices unaffordable for consumers. A more accurate expression would be: to allow products with technological content, design capabilities, service capabilities, and brand value to receive reasonable premiums, so that prices can once again become signals reflecting true value. Only in this way can e-commerce move from "low price competition" to "quality competition" and truly achieve high-quality development.

In the 18th year of Double 11, it is no longer just a node for companies to boost sales, but more and more like a stage test of China's e-commerce development model. It tests whether the platform has more mature governance capabilities, whether the brand has more stable long-term business capabilities, and whether consumers can make more rational choices under more transparent rules. If a new balance can be formed between price, quality, brand, service, and regulation, e-commerce competition can completely shift towards a more resilient and innovative mature development stage.

(The author is a researcher at the Institute of Finance and Economics Strategy, Chinese Academy of Social Sciences)

(Author Liu Cheng)