Taobao.com has launched a new mechanism entitled "Advanced Compensation by Sellers" in order to dispel users' worries about the security of online shopping. The mechanism, which will be implemented on the entire website, is expected to attract more users to the site's online shopping services.

Prior to this, Taobao.com had tested the service in parts of its website. A user support rate of above 99% was calculated amongst buyers and sellers.

Following the implementation of the new mechanism, qualified sellers who open a store at Taobao.com will be able to pay a certain amount of money as a guarantee for their goods sold on Taobao.com. The fees will be remitted by means of the third party payment tool "alipay". When disputes arise in goods transactions, and the buyer asks for claims after ineffective communication on the part of the seller, Taobao.com will use the money to compensate the buyer on behalf of the seller. The service only takes effect after the buyer forwards an application for claims and Taobao.com confirms and accepts the application.

In order to encourage credit transitions, goods sold under the "Advanced Compensation by Sellers" mechanism will be enclosed with special labels. In addition to this, Taobao.com will focus on three categories of goods: cell phones, digital cameras and online games, in the initial implementation of this service.

Meanwhile, to ensure the effectiveness of this service, Taobao.com has set requirements for new sellers who want to join the service. These requirements include that sellers must open a store for at least three months with credit at the three-star level; they must receive good comments from 97% of their buyers; the successful complaint rate must be less than 0.5%; and sellers who sell cell phones and digital cameras must use "alipay" with a frequency rate of higher than 70%.

IResearch Consulting, an authoritative market research company in China, has stated that the launch of this service will strengthen online shoppers' loyalty and attract more non-online-shoppers to join in online shopping by alleviating their concerns regarding online sellers' credit and the quality of goods.

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