Deep Sound Original · The author | Xiao Humble
In 2022, each family still made enough articles at the New Year's Eve party, but the liveliness and highlights do not only belong to the performances on the stage, but also belong to Taote, which won the exclusive title of Hunan Satellite TV's New Year's Eve party for the first time.
On the eve of the New Year's Eve, Taote opened a New Year's Eve promotion. The price of this promotion is very attractive, 30 neutral pens only sell for 8.9 yuan, 300 flosses are only 7.5 yuan, and there is an electronic scale that costs only 14.95 yuan, a fully automatic umbrella of 13.2 yuan, and a hairball trimmer of 14.5 yuan.
Compared with many brands that are keen on naming evenings, Taote is a young platform. Although the "debut" is only more than a year, Taote is not ambiguous in doing big promotions - in addition to the recent "New Year's Eve promotion", Taote has previously launched a 34-day "special provincial festival" promotion, a 20-day 618 promotion... If you count various "1 yuan purchase" and category activities, Taote is engaged in big promotion activities almost all year round.
Corresponding to the big promotion, Taote's growth is also rapid. Alibaba's fiscal second quarter of fiscal 2022 shows that Taote added 50 million new active users in a single quarter, and the annual active consumer (AAC) exceeded 240 million. From the launch to the more than 240 million users, Taote only took 18 months.
Ali's top management has high hopes for Taote. Daniel Zhang has said that "it (Taote) has the goal of bringing incremental users and meeting consumers' demand for cost performance" and "will continue to invest in our strategic emerging business areas in the future".
All of this seems to be somewhat "déjà vu": it is a big promotion and a growth, and the group invests real money and silver in it. Is Toute trying to repeat the story of a round of subsidy growth in the sinking market?
This is clearly not the case. Common sense tells us that it is impossible to achieve such results by following and imitating alone. What's more, Alibaba is not a new player in the field of e-commerce and supply chain, and this large company, which has been established for more than 20 years, is fully capable of taking a unique path in the face of a sinking market.
The price of "breaking through the soul" is achieved by relying on taote's unique direct supply model. According to the report "Investigation Report on the Direct Supply Model of Taote Factory" released by the Digital Finance Center of Peking University, the Amoy direct supply model empowers factory sales and improves the efficiency of commodity circulation. In the end, consumers are provided with good goods at low prices.
Looking at the bottom, digital technology can promote the rapid flow of various resource elements, and the ultra-short-chain production and supply system created by Taote Direct Supply is actually to re-realize the innovative configuration of market factors through digital technology, empower the transformation and upgrading of traditional industries, and then help structural supply-side reform.
To deeply understand Taote and the big promotions made by Taote, it is necessary to use a set of frameworks exclusive to Taote.
Neglected riches
M2C is the code that understands Taote.
M2C, full name "producer direct consumer", is Ataote's unique model for going deep into the sinking market. The production end includes industrial belt factories and the origin of agricultural products, and the consumer side corresponds to the majority of sinking market consumers.
These are two long-neglected rich mines.
First look at the production end, taking the factory as an example, the domestic manufacturing industry has undergone many years of tempering, and the factory has a good manufacturing capacity. But the new problem is that many industrial belt factories have little bargaining power in the industrial chain, and the industry shows a Matthew effect, at the same time, these industrial belt factories cannot be directly connected to the consumer end, which makes their situation always embarrassing, and even somewhat dangerous.
There are many examples, Shenzhen's Pan Xiaoqiang began to enter the mobile phone manufacturing industry in 2007, once focused on the button elderly machine market, this business once let it spend the "golden four years". However, after entering the 4G era, Pan Xiaoqiang's button machine business has fallen into a dilemma, and the competition for smart machines cannot compete with large factories, and it is difficult to directly connect with the target audience is the primary problem faced by the button elderly machine.
Many products are in a similar situation with key machines for the elderly. For example, large-capacity charging treasures, farmers who work for a day, anchors in the field, workers in front-line workshops, and square dance enthusiasts all regard it as just needed, but it is not easy to find suitable products on the market; for example, buckwheat pillows that are not easy to grow insects and can be freely adjusted in height, factories can use the alpine buckwheat shells of Daliangshan to mass-produce high-quality buckwheat pillows, but it is difficult to find corresponding consumers.
These products have common characteristics: the factory side obviously has enough manufacturing capacity, but because of the lack of direct channels, supply-side marketing momentum and operational capabilities, the product has not matched its consumers. The skills of the factory can only be shelved.
Looking at the consumer side, the distress of the production end also exists in the sinking market consumers.
In addition to the above-mentioned button elderly machines, there are still a large number of unmet needs in the sinking market. The siphon effect of large cities occurs not only in terms of funds and talents, but also in the attention of demand. But the problem is that consumers in the sinking market do not lack spending power, and even their disposable income and time are even higher than those of consumers in first-tier cities.
Most importantly, with the flattening of economic development and poor information, the consumption upgrading needs of consumers in the sinking market are becoming increasingly significant. They also yearn for a refined life, especially for young people with up-to-date ideas.
Zhejiang Tonglu's Buda is a post-95, after graduation, he returned to his hometown Tonglu to open an art training class. As the deepest and fastest group of people in the county's village and town households, Buda brings family members and neighbors to contact a variety of fashionable products and lifestyles, such as sparkling water, board games and camping.
In order to promote his art training class, Buta also created a "European ins style balcony". Every time he changes seasons, he has to tinker with the balcony, and if he only looks at the photos posted by Bouda on social media, he thinks that this is the internet celebrity punch point in which first-tier city.
Such consumption dynamism prevails in today's sinking market. Again, the M-side and the C-end are two rich mines, and if the two can be efficiently connected, the benefits will be unlimited.
And that's exactly what Tut is doing. Taote tries to make the production end focus on the purest manufacturing links, so that consumers can get low-cost goods. This is a new set of supply and demand matching frameworks, and it is also a framework that only Taote can establish.
A one-of-a-kind Taote
The so-called "new supply and demand matching framework" refers to the fact that compared with the traditional "factory-brand-dealer-wholesaler-retailer-consumer" business model, Taote M2C has created a direct connection model that was not available in the past. This model greatly cuts the intermediate links, the production side can get more profits, and the consumer side can also get low-cost goods.
The reason why only Taote can establish such a framework is related to the background of Taote's birth.
Although the surname is "Tao", Taote was actually born in the Ali B Department, and its achievements are more derived from its utilization and transformation of the group's existing supply chain capability base. Compared with young competitors, Taote naturally has an industrial belt foundation, opens up 1688, and naturally understands the B-end, rather than only doing some pure To C subsidy actions.
M2C is the key to Taote's ability to achieve high-frequency promotion. The "promotion" and "low price" under the traditional model either compress the profits of the upper and middle reaches of the industry or sacrifice the quality of the product, but the big promotion of Taote is not "to suppress the price by the flow", but to fully have the advantages of the supply chain, identifying and delivering "good goods" to the market at the same time, using the advantages of the model to provide consumers with "low prices".
Alibaba is well versed in sector governance, and by connecting and collaborating with resources and capabilities within or between business sectors, the Group can go deep into strategic locations in a unique path, and Taote is a typical example.
In Alibaba's recent organizational structure adjustment, the Tao system and the B department have been fully integrated in the organization, and the "BC integration" has been upgraded. Taobao, Taote, and Taocai form a synergy to greatly reduce the connection cost between the B-end and the C-end. For Taote, this means that it will be supported by strong market insights and resources in the process of penetrating into the consumer market. These capabilities can help the production side "digitize at minimal cost".
For example, factories and farmers who access the Taote ecology do not need to open stores online, and all kinds of processes such as opening stores, new products, operations, and delivery can be handed over to Taote. The factory decides how to develop new products, and can also refer to the sales trends provided by Taote. In a word, after the production end accesses the Taote ecology, it only needs to do a good job in production and can enjoy the results brought by digitalization.
This is the core value that the M2C model brings to the production side. Then, on the basis of the correct direction of the model, the ability of the platform supply chain, and the reliability of C-end resources, the high-frequency promotion will accelerate the release of M2C energy:
In September 2021, Taote released the "Semi-annual Report on Helping Farmers", showing that through official subsidies and other measures, the direct supply of Tao's special production areas to "promote production with consumption" has driven nearly 500 counties and districts and 110,000 agricultural cooperatives across the country, with a subsidy coverage rate of 8 million agricultural and sideline products reaching 100%, with a cumulative sales volume of nearly 500 agricultural products of more than 100,000 single agricultural products, and a cumulative sales volume of nearly 20 agricultural products of more than 1 million.
In 2021 Double 11, factories covering nearly 1,000 industrial belts across the country will directly connect 200 million county consumers through Taote, and directly participate in Double 11 like brand owners. Relying on the direct supply model, Taote M2C direct supply orders increased by more than 100% year-on-year, and the new supply drove the new consumption of the county to increase by 4 times, and nearly 3,000 direct supply manufacturer orders achieved a 10-fold increase.
Of course, the growth is closely related to the subsidies and promotions on the part of Taote, but the growth is only the "result". The real significance of the big promotion is to allow the M2C model to penetrate the market faster, so that more originally neglected producers and consumers can join in and enjoy the results of the advanced model.
With the traffic support of Taote, Shenzhen Pan Xiaoqiang's button machine business has been revitalized - in October last year, the average daily single volume from Taote reached about 5,000 orders. Pan Xiaoqiang gained certainty in production, but also discovered many new needs. Through Taote, Pan Xiaoqiang incubated the intelligent elderly machine brand "Care Heart", "Care Heart" built-in positioning function, can help children find lost elderly people, Pan Xiaoqiang also completed the leap from OEM to independent brand.
In addition to helping manufacturers grow, the M2C model also has a unique ability to resist risks. At the beginning of November 2021, the strongest cold wave hit Gansu, and Taote, based on the storage capacity of the production warehouse, urgently directly mined more than 10,000 tons of apples in Gansu before the arrival of the cold wave, and the losses of farmers were greatly reduced.
On the consumer side, the changes brought by Taote are also immediate.
In 2021, the sales of Taote kitchen wipes increased by 2103% year-on-year in August of the previous year, and the sales scale increased by 1626% year-on-year. Batch after batch of cost-effective wet wipes swept the sinking market, replacing traditional rags, and consumption upgrades were realized.
Some of the update tidal changes are also emerging. The first order of the young town's young man in Taote was a campervan, and her Taote shopping cart also contained more than a dozen commodities such as fascia guns, yoga clothes, and Christmas trees. Those who thought that they would only appear in the first-line exquisite youth life are sinking the market to blow the wind of "new lifestyle".
The beginning is not unique. Taote data show that the orders of young people aged 18-40 account for nearly 50%, these young people are leading the county consumption trend, cost-effective pursuit of a better life has become the main consumer fashion, perfume, aromatherapy and other supplies orders recorded several times year-on-year growth. During the double 11 period in 2021, cat litter even replaced garbage bags to become the first product to break 10,000 orders.
Born in 1996, Li Gaocai often laments the changes that Taote has brought to the county, in her view, most of the lifestyle guidelines on the market are made for consumers in big cities, and the products on the market are either not practical, or not sold locally, or too expensive to be cost-effective. But "Taote's top goods hot list seems to be prepared for people living in the county." ”
During the double 11 period, Li Gaocai placed an order in Taote for a long time, "often brushed in the video that people use air fryer to make various cuisines, and have seen several models in the store that are very expensive, and there are subsidies for double 11 Taote, and we also take the opportunity to improve the quality of life." ”
Create a new paradigm
There are many changes brought by Taote, and these changes will continue to change the industrial base and further enrich the ecology at both ends of supply and demand.
There are many kinds of innovation, some of which are innovation on the surface of the existing industrial base, and this innovation often transfers profits from one link in the industrial chain to another, and does not create considerable incremental value. Deeper innovation is about reshaping the industrial base, and all parties can grow, not become one or the other.
The latter logic is a unique way of looking at both ends of the supply and demand side of the Taote link.
First of all, M2C's source direct supply model itself can reduce the circulation cost of goods circulation and supply; secondly, for the production end, Auttech's big promotion has brought scale effects to the industrial belt, rather than allowing them to sacrifice profits for sales. On the contrary, the more orders, the larger the production scale of the factory, and the higher the economic benefits. A toothbrush factory, through Taote, can sell 199 yuan of electric toothbrushes in supermarkets to a price of 14.9 yuan, while the factory profit margin is still 13.5%.
For consumers in the sinking market, Taote allows them to buy good things at low prices, one to save money, and the other to try new lifestyles with low thresholds. When the wind of "new lifestyle" blows in the sinking market, the change of trend will in turn help the industry side again.
With the formation of positive feedback, some things that the industry thought were "impossible" in the past will become possible, such as the creation of independent brands in factories and the branding of agricultural products:
There are already many factories that realize the unique value of Taote. In 2021 Double 11, more and more factories choose to promote new products on Double 11, and the industrial e-commerce platform Taote has become the first choice for new product publicity in factories, so as to export brand concepts to county consumers.
The reverse guidance of consumer consumption data and consumption orders will make farmers more confident in their production. Mature supply chains will also reverse the branding of farmers' products. All this will promote the upgrading of the supporting environmental base of agricultural products and attract more talents to build new agriculture.
Stretch out the time a little longer, and the value of the tao's big promotion will become clearer. Taote's big promotion is not a kind of "wool", a series of big promotions in exchange for not only data growth, but for the production side and consumer side to bring long-term changes, and all this has just begun.
For a long time, the context of the Internet has been focused on growth, especially the To C platform, as long as it can grow, it does not matter what the source is. This rough thinking mode is no longer suitable for the present, Taote is giving a new paradigm, a win-win situation for many parties, and county consumers live a refined life, in a sense, Taote M2C model is an inevitable trend to achieve cost-effective consumption and consumption upgrades at the county level.