Chinese classified giant 58.com (NSYE: WUBA) is once again struggling to fight the flow of illicit and illegal goods through its mobile c-to-c marketplace Zhuan Zhuan. According to a report on Sohu.com (in Chinese), the Public Security Bureau is investigating a case in which a Zhuan Zhuan user was found to be using the platform to sell cannabis — a strictly controlled drug in the country.
The news is only the latest in a series of control issues for Zhuan Zhuan. Last year, a user managed to obtain an illegal poisonous snake through the platform, before being bitten by that snake and dying. Several instances of the trading pornographic material — another major no-no in China — have also been raised by authorities.
Just last week, Zhuan Zhuan and another 58.com brand, property vertical Anjuke, were notified that their apps were in violation of the country’s first Cyber Security Law.
As recently as last year, Zhuan Zhuan was considered to be neck-and-neck with rival mobile flea market Xianyu, operated by e-commerce giant Alibaba (NYSE: BABA). But the site’s prospects have dwindled over the past 12 months, with Zhuan Zhuan’s market share falling to less than half that of Xianyu.
The IResearch Mobile App Index by IResearch Consulting recorded monthly unique installations of the Zhuan Zhuan app falling by more than half over the past year — from more than 13 million in June 2018 to around 6.5 million in June 2019. The Baidu Index, which tracks terms used on the Chinese search engine, finds that the composite “interest score” in Zhuan Zhuan has fallen by more than 40% over the past year.