JD chides Alibaba for Singles’ Day move practice

Rival accused of monopoly due to asking media outlets to pull ads

China's major e-commerce platform operators have started a war of words ahead of the country's annual biggest online sales event, with JD.com Inc on Thursday accusing its major rival of unfair competitive practices.

In a Weibo post on Thursday, JD, China's second-largest online retailer, complained that as "Shuang Shiyi" (double eleven in Chinese) is a registered trademark of Alibaba, they can no longer use the term to advertise its sales promotions for Singles' Day.

"The company [Alibaba] is trying to 'legally' own the shopping festival and has even asked media and TV stations to remove other e-commerce peers' ads that have the registered term. This violates the Internet spirit of openness… and is an act of monopoly," read a statement on a JD spokesperson's Weibo account.

In response to this, Tmall, Alibaba's business-to-customer arm, said on its Weibo late Thursday that Shuang Shiyi (referring to the shopping festival, not the trademark) belongs to everyone, and they are trying to forge a global Shuang Shiyi shopping carnival.

In order to gain pre-publicity for its Singles' Day promotion, which is set to run from Saturday to November 12, JD has put out ads with the terms Shuang Shiyi and "Xiatao" (not worth buying in Chinese) recently.

Terms such as "Shuang Shiyi" or "Shuang 11" or "11.11" are usually used by e-commerce giants to describe their Singles' Day sales promotion, which occurs in November and was initiated by Tmall in 2009.

Alibaba felt JD's ads had not only infringed on its trademark but also suggested that Tmall is selling fake goods. On October 16, the company sent a notification to some media outlets to remove those ads, a PR representative from Alibaba told the Global Times Thursday.

As for JD's post, Alibaba said that they have already become accustomed to fierce competition ahead of the Singles' Day promotion and expect to continue focusing on their customer services instead of being dragged into a spat.

The PR staff noted that the company has gradually registered several trademarks related to the sales event, including Shuang Shiyi, since 2012.

Despite its legal ownership of those trademarks, Alibaba did not manipulate its dominant position or compete unfairly as JD alleged, Zhao Zhanling, a legal counsel with the Internet Society of China, told the Global Times Thursday.

"But I think Shuang Shiyi has lost the legal protection as a trademark by becoming a common name for the nationwide shopping festival, therefore other players in the e-commerce sector have the right to apply for the trademark's revocation [from Alibaba]," Zhao said.

Meanwhile, Suning Commerce Group, which will roll out its Singles' Day promotion between November 7 and November 12, weighed in on the dispute Thursday.

It is legal but not right for Alibaba to ban others from using its registered trademarks in ads, while JD's disclosure of the ban, some 10 days later, triggered a war of words as a publicity stunt, souring the image of e-commerce firms, Suning wrote on its verified Weibo post Thursday.

Feng Lin, a senior analyst at China E-Commerce Research Center, told the Global Times that JD's move aims to attract more consumers from its major rival Tmall ahead of the nation's biggest online sales event.

For last year's Singles' Day shopping promotion, tmall.com and taobao.com, Alibaba's consumer-to-consumer platform, recorded aggregate sales of 35 billion yuan ($5.7 billion), 10 times JD's sales revenue of 3.5 billion yuan.

This year, tmall.com has made an early start via a pre-sale promotion for home appliances on October 15, while JD opened a large warehouse in Shanghai to increase its logistics efficiency during the Singles' Day period.

JD's ownership of its own warehouse certainly gives it an edge against Alibaba in terms of logistics and user experience, Tang Jia, an industry analyst with Analysys International, told the Global Times Thursday.

But it is not easy for JD to catch up with the e-commerce giant immediately, as Alibaba also has advantages such as more choices of goods, said Tang.

JD mainly sells home appliances, clothing, food and books while Tmall also sells those but is trying to sell others.

On October 20, US luxury electric car maker Tesla announced it had joined Alibaba's Singles' Day sales promotion, selling the Model S on Tmall.

But local media reports said Thursday that Tesla's US headquarter ordered the selling to be suspended.

The model is still available on tmall.com as of press time.

Alibaba's PR said that Tesla Motors and Tmall are still seeking a suitable way to cooperate.

Data from Beijing-based market research firm Analysys International showed in late July that Tmall held a market-leading share of 52.4 percent for the second quarter in terms of sales volumes, followed by JD with 18.7 percent, and Suning with 3.5 percent.