Chinese e-commerce giants take steps towards integration

Shoppers get more payment options, while platforms widen their reach

- Michelle Ng

BEIJING - Consumers will have more payment and delivery options to choose from on major Chinese e-commerce platforms like Taobao, amid a move to promote cross-platform integration.

On Sept 27, WeChat Pay was included as a payment option on Alibaba's online marketplaces Taobao and Tmall, adding to Alipay, credit and debit cards.

And from mid-October, consumers shopping on Taobao and Tmall will have one more delivery option by JD Logistics, considered to be one of the most reliable in China, besides Alibaba's own Cainiao distribution service. In return, JD will introduce Alibaba's payment service Alipay and Cainiao's delivery services on its platform.

The integration of payments and logistics services on rival platforms marks a departure from the previous model.

This comes after a regulation for China's internet industry kicked in on Sept 1, to prevent and stop unfair competition among platforms, maintain market order, encourage innovation and protect the rights of operators and consumers.

Before 2021, the key players in China's e-commerce sector operated in isolation, building up "walled gardens" that forced users to stay on one platform as companies aggressively guarded their ecosystems.

But a crackdown by Beijing that year on the tech sector saw Alibaba slapped with a record 18 billion yuan (S$3.3 billion) antitrust fine for abusing its dominant market position.

From then, companies started taking small steps to open up their ecosystems, such as Tencent's WeChat app allowing users to access Alibaba's Taobao links.

Mr Li Jianggan, chief executive of Singapore-based venture outfit Momentum Works, said Chinese tech companies have reached a point where collaborative competition is the only way forward.