Chinese Deal Hunters Force Online Shops Out of Business

  • Consumers create Wechat groups to find deals on different online shopping websites.
  • People take advantage of business mistakes to buy lots of products.
  • Amazon suffered several times similar cases before abandoning the Chinese market in 2019.

Taobao, Tmall, Jingdong, Pinduoduo…Endless competition between different online shopping websites in China has greatly benefited domestic online shoppers. Thanks to competition between couriers, most products can be delivered very fast and free of charge. But all people will not be satisfied. Consumers keep demanding cheaper products. In recent years, a new word, “Yangmao Dang,” has been created to describe people who seek deals on different websites. Yangmao means woolen fleece in Chinese. These deal hunters are like shearers who cut Yangmao off the sheep (in this case, the online shops).

Some organizations are also Yangmao Dang, which multiplies the damage to shops.

There are countless Wechat groups where people share heavily discounted products. Most of the time, these products are on sale either on special days like Double 11, China’s Black Friday, or simply because the shops want to promote themselves through selling bargains. However, these Wechat groups do not limit themselves there. When they spot a loophole on some product, they attack, ruthlessly.

During the Double 11 in 2019, a shop on Tmall made a mistake. Instead of 4,500 grams of oranges for $3.85, it showed 4,500 Jin, a Chinese unit equivalent to half a kilo.

A Yangmao message in Wechat groups.

An influencer led his fans into the shop and placed orders of over $1 million before the shop changed the error. Knowing that the shop wouldn’t be able to send the products, they intentionally reported the shop to Tmall asking for compensation. The next day, the shop announced bankruptcy and closed. Internet users criticized the actions by Yangmao Dang and Tmall helped the shop overcome the situation and reopen later.

Also in 2019, a worker at Jingdong made an error on one coupon, which allowed people to buy a $30 oven for just $1. Over 240,000 orders rushed in after people read the deal on Wechat groups. Jingdong took responsibility and paid for it. Informants said the whole department where the worker worked was sacked right after.

The kettle shop pleads for the consumer to cancel the orders.

On October 8, 2020, a message circulated in Yangmao Dang groups. According to the message, with a few coupons, a $10 kettle could be bought for $0.50. Within one hour, over 200,000 orders were placed. The shop soon announced that they had been deceived by an ad company and they couldn’t afford to complete these orders. They pleaded for the consumers to cancel the orders, otherwise they’d go out of business. So far, most of those who have placed orders claim that they will not cancel the order because they don’t need to be responsible for a business mistake.

As one of the few foreign competitors in China, Amazon has witnessed its share of similar cases over the years, including one where Chinese consumers took advantage of the return policy to get two Kindles while just paying for one. A reminder: Amazon closed its Chinese domestic shopping business in 2019.

Commenting on the Yangmao Dang, many people say that it’s not the internet users that have become bad. On the contrary, it’s the bad guys that have learned to use the internet.

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