The People’s Daily Calls for Oversight and Punishment to Ensure the Healthy Growth of Live-Streaming E-Commerce
The live-streaming e-commerce industry in China has experienced explosive growth in recent years, becoming a vital channel for e-commerce platforms to attract consumers. However, a recent opinion piece in the People’s Daily, the chief mouthpiece of the Chinese Communist Party, highlights the urgent need for tighter regulation in the sector. The article emphasizes the prevalence of misconduct, ranging from fraudulent advertising to misleading pricing, and argues that addressing these issues is crucial for the industry’s sustained and healthy development.
Exponential Growth and Increasing Concerns
Live-streaming e-commerce has witnessed remarkable expansion, with sales in the sector soaring by 58.9% year on year in the first 10 months of this year, amounting to 2.2 trillion yuan ($311 billion) and accounting for 18.1% of all online shopping sales in China. Key players in the industry include Alibaba Group Holding’s Taobao, ByteDance’s Douyin, and Kuaishou Technology. However, despite its success, concerns about the sector’s rapid growth and potential abuses have emerged.
Signs of Saturation and Declining User Growth
While the live-streaming e-commerce market has been booming, signs of saturation have started to appear. In 2020, China gained 51 million new users, a decrease from the 75.8 million added in 2019. The trend is expected to continue with only 12 million new users added in the first half of this year. This slowdown raises questions about the sustainability of the industry and the need for effective regulation to maintain healthy competition and protect consumer rights.
Unchecked Abuses and the Need for Oversight
The People’s Daily opinion piece highlights the unchecked abuses within the live-streaming e-commerce sector, which it argues can harm consumer rights and hinder market competition. The article emphasizes the importance of addressing these issues to ensure the industry’s future growth and sustainability. The piece calls for tighter control without hindering development, promoting cooperation between regulators, online shopping sites, and merchants to combat market abnormalities.
International Scrutiny and Government Intervention
While live-streaming e-commerce has been tolerated in China, the model has faced increased scrutiny abroad. In September, Indonesia became the first country to ban e-commerce transactions on social media platforms, including TikTok, to protect smaller offline merchants. This move reflects growing concerns about the impact of live-streaming e-commerce on traditional retail and the need for regulatory intervention.
Existing Regulations and the Way Forward
Chinese authorities have already introduced regulations aimed at curbing malpractices in the live-streaming e-commerce industry. In April 2021, the Cyberspace Administration of China and six other regulators released rules targeting the sale of counterfeit products, falsification of view numbers, and promotion of pyramid schemes. However, the People’s Daily opinion piece emphasizes the need for ongoing efforts and collaboration among stakeholders to effectively tackle market abnormalities and ensure the industry’s healthy development.
Conclusion:
The live-streaming e-commerce industry in China has experienced tremendous growth, but concerns about misconduct and the need for regulation have come to the forefront. The People’s Daily opinion piece underscores the importance of addressing these issues to protect consumer rights, maintain healthy competition, and sustain the industry’s growth. As the sector faces international scrutiny and signs of saturation, tighter oversight and cooperation among regulators, online shopping sites, and merchants are crucial to steer the live-streaming e-commerce industry onto a healthy development track. Only through concerted efforts can the industry continue to thrive and contribute to China’s vibrant e-commerce landscape.
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