Nongfu Spring founder urges limits on e-commerce platforms

Chinese beverage giant Nongfu Spring founder Zhong Shanshan has criticized the growing influence of e-commerce platforms, arguing that algorithm-driven pricing and traffic allocation are disrupting traditional retail networks and intensifying price competition.

Speaking on CCTV Finance's interview program Dialogue on Saturday, Aug 8, Zhong said traditional distributors and middlemen operated under more transparent and predictable fee structures, while online platforms use algorithms to adjust commissions on individual transactions and determine merchants' visibility.

Zhong argued that platform companies have effectively become a new form of intermediary, replacing traditional distributors and reshaping the retail ecosystem. He said the expansion of digital marketplaces has placed significant pressure on offline retailers and contributed to the disappearance of many city-based distributors.

Zhong also criticized the effect of e-commerce on consumer behavior, saying online platforms have reduced the spontaneous, experience-driven purchases once common in physical stores.

"Many stores in cities relied on emotional and impulse-based consumption. People would walk through a shopping area, see something they liked and decide to buy it," Zhong said. "That kind of emotional and spontaneous consumption has been eliminated."

He added that excessive reliance on smartphones has reduced people's engagement with their physical surroundings and could affect creativity among younger generations.

"People spend their days absorbed in phone screens, with their thoughts confined there," Zhong said. "Where are creativity and emotional experiences? I believe the power of platforms must be limited."