Tmall.com, the biggest business-to-consumer website in China, will subsidize its vendors' and buyers' promotions to the tune of 1 billion yuan ($157 million) in the second half, amid fierce competition from rivals that also offer subsidies to win customers.

This is the third subsidy Tmall.com has announced in the past three months.

Since May, Tmall, the online shopping arm of e-commerce giant Alibaba Group Holding Ltd, has been paying 300 million yuan in subsidies to vendors and buyers in summer promotions of electronic products. Tmall then gave buyers "red pocket money" worth 90 million yuan in June when almost all of the top 10 e-commerce players were offering large discounts and rebates to users.

Price wars are a common practice for China's e-commerce players, and will continue for a long time to be a way to lure shoppers, according to analysts. However, this strategy also adds to the companies' financial woes, with most of them still in the red.

Tmall expects its total transaction volume to be 200 billion yuan this year, more than double what it was last year. Its current profit margin is about 50 percent, it said, as it generates revenues from advertisements and commissions from vendors that trade on it.

There were 194 million online shoppers in China by the end of last year, according to the China Internet Network Information Center. Tmall is the biggest player in China's business-to-consumer market, with a 37.4 percent share in the first quarter, followed by 360buy.com's 17.2 percent and Suning's 2.4 percent, according to domestic research company Analysys International.