China’s ecommerce titans, and China’s ecommerce market in general, are maturing, and it is becoming harder to produce the outlandish growth figures of years past. And if organic slowing isn’t enough of a concern, China’s economic regulators are on the prowl as well, which doesn’t bode well for the continued domination of the largest players.
Alibaba has been in the news for all the wrong reasons in China for nearly a year, and the situation shows little sign of improving. Alibaba and its affiliated properties—including most notably Ant Financial and AliPay—have been squarely in the crosshairs of China’s financial regulators and antimonopoly watchdogs since mid-summer 2020, and a massive corporate restructuring remains in process.
Enormous fines have been levied and paid, IPOs have been canceled, senior-most executives have been reshuffled, and Alibaba founder Jack Ma has been largely silenced as a public figure.
No one knows what the ecommerce portion of the Alibaba empire will look like once everything shakes out, but the company will certainly have lost access to some of the techniques that it has used to maintain its dominance. Furthermore, the antitrust investigations roiling China’s ecommerce ecosystem are impacting big players like JD.com and PDD as well. They too are being forced to abandon their exclusivity arrangements with merchants and rein in their pricing strategies.