Text | Deep sound, the author | Chen Wenqi, the editor | Yalan
“Oh My Lady Gaga！” An anchor named Jessica shouted a sentence in her TikTok live room.
This is similar to Li Jiaqi's iconic "even buying Karma" - instantly arousing the fans' desire to buy. Jessica sells a variety of transshipment gems and crystals, and her TikTok account @dh_crystal_service has amassed 520,000 followers, and many videos have 100,000+ views. The phrase "Oh My Lady Gaga," which she often says in the video, has become a code word between her and her fans, appearing frequently in the comments section, "Because of you, my two daughters have started saying this sentence haha," one fan wrote.
Jessica's crystals come from China. According to the video content, the Chinese company named DHDesign currently only provides product free shipping services in the United Kingdom, and the account account said in the reply that the goods will be launched in the United States soon. Prices for gemstones and crystals range from as low as 2.99 euros (~20 yuan).
TikTok account number @dh_crystal_service
Douyin once made some people "get rich first", and now it's TikTok's turn.
With more than 1 billion monthly active users worldwide, TikTok, the commercial flywheel of the super app, is spinning rapidly. Behind the increasing number of grass planting, selling short videos and live broadcast content are anchors like Jessica, brands and sellers who go to sea, third-party service providers, MCNs and various roles in the ecosystem.
"Now in the TikTok e-commerce dividend period, there are various supports, and the threshold for entry is very low." Gu Jun, founder of Newme, a home furnishing brand, told Deep Sound.
The lower cost of traffic is also one of the reasons that attracted him to almost all in TikTok (all bet on TikTok), "now TikTok's CPM (Cost per Mile) is about $10," a figure that is one-third of Facebook's matrix products.
The ecological puzzle of TikTok e-commerce is stepping into place, this well-known cake, how to eat?
acceleration
Time is running out, and TikTok's e-commerce footprint is expanding at a fast pace, and it is getting faster and faster.
In 2020, TikTok will only test the water e-commerce function in a small range, cooperate with Shopify, allow some merchants to open purchase connections on TikTok, cooperate with Walmart, and cooperate with Internet celebrities to do special activities for live streaming with goods.
At the beginning of last year, TikTok in Indonesia and the United Kingdom has launched the TikTok Shop function, similar to the domestic Douyin small store, and gradually from the invitation system to the open, improve the tools, functions, consumers can complete the whole process of shopping in TikTok, that is, the so-called "full closed loop". The US site has opened TikTok Shopping, where viewers can click on shopping cart links from videos and live streams, and the purchase is done outside the station, which is called "semi-closed loop" in the industry.
Recently, TikTok Shop has added three new sites in Southeast Asia, Thailand, Vietnam and Malaysia, and opened its official website registration for enterprises with local business licenses and individual sellers with local ID cards/passports.
PONGO, an overseas marketing service provider that focuses on southeast Asia, revealed that last year, TikTok e-commerce held a sharing meeting in Guangzhou, and the head of its e-commerce cross-border business also made it clear that TikTok will focus on the Southeast Asian market in 2022.
On TikTok's official website, there are 336 vacancies on e-commerce, including user operations, creator operations, logistics managers, algorithm engineers, etc., and the demand is particularly strong in Southeast Asian regions such as Jakarta, Manila, Ho Chi Minh City, Kuala Lumpur, Singapore, and Bangkok. Ireland, which has not yet opened an e-commerce business, also has relevant jobs open.
TikTok recruitment website
Southeast Asia has become a significant growth point for TikTok's e-commerce business. According to 36Kr's recent reports, TikTok e-commerce 2021 GMV is up to about 6 billion yuan, of which GMV accounts for more than 70% from Indonesia, and the remaining less than 30% from the Uk.
Orangutan PONGO CEO Na Xin told Shen Xiang that the average daily GMV in the company's live broadcast room ranged from $10,000 to $50,000, and at the end of last year's Christmas promotion, the peak of a single GMV exceeded 1 million yuan. Since the second half of last year, the number of celebrities and brands that have entered its internet celebrity SaaS service platform PongoShare has seen significant growth.
According to 36Kr, TikTok e-commerce GMV targets for 2022 are close to 12 billion yuan, nearly doubling from 2021.
Although the figure is not even a fraction compared to the annual GMV of Alibaba Jingdong's trillion level, considering that the foreign market has not yet been fully rolled out, it is still in the stage of cultivating user habits, leveling the supply chain, logistics and other links, and the initial investment has seen positive feedback.
At the staff scheduling and organizational level, according to late Post, in 2021, TikTok's commercialization team, including advertising, e-commerce and live broadcast teams, expanded in a large area, from less than 4,000 people in early 2020 to nearly 20,000 people.
In addition to the various accelerations inside, TikTok is also actively looking for "external" partners.
In August last year, ByteDance's strategic investment focused on the Cross-border E-commerce Warehousing and Logistics Service Company Zongteng Group, which focuses on Europe and the United States, which is also a partner of TikTok's current services in the UK and the US. In Southeast Asia, TikTok has actually improved its logistics services through cooperation with Jitu (there are rumors that Byte intends to invest in Jitu, but this news is denied by both sides).
In addition, according to Bloomberg, last November, ByteDance invested in Amazon, the logistics service provider of Middle East e-commerce Noon, and dubai-based logistics company iMile. Also invested in the track are cross-border e-commerce companies such as Skelingko and Patoson.
In the payment link, TikTok stores in different regions have also been connected to different local payment systems, such as PayPal, Dana in Indonesia, etc.
For the supply chain, 36Kr reported that Kang Zeyu, the head of TikTok e-commerce, president of Douyin E-commerce, has been focusing on investigating factories and industrial belts in Jiangsu, Zhejiang, South China and other places in the past six months, trying to establish anchor merchant selection channels similar to the Douyin e-commerce "Selection Alliance" in TikTok.
At present, there is a consensus in the industry that TikTok e-commerce, especially the live broadcast business with goods, is still in its infancy, and the chain of "planting grass - pulling grass - after-sales" has not yet been smoothly opened. But this is enough to attract Chinese sellers with a keen sense of smell, to be active and active in layout.
Grab the dividends
Chinese sellers value TikTok's opportunities so much that they more or less carry a hint of unspeakable emotion.
For a time, the industry was in mourning. This unexpectedly gave TikTok a chance to gain the hearts and minds of the sellers going to sea. Cross-border sellers who have been pressing on goods for a long time can't wait to find other traffic channels and e-commerce platforms to create glory again.
"(TikTok) will of course be more friendly, and the ones who are more willing to believe that TikTok can make e-commerce must be Chinese players, because we have witnessed the success of Douyin (e-commerce)." Gu Jun, founder of Newme, said. He has worked for JD.com, Lebee.com, Vipshop, and has continued to start a business in the field of e-commerce.
Now, TikTok, which is "bent on making the plate bigger," is also far friendlier to new sellers than other platforms. Gu Jun told "Deep Ring" that TikTok has subsidies in commodity sales, logistics, live broadcast incentives, user shopping, etc., and will also give different levels of support in traffic during the promotion. In different regions, although the qualification review criteria for opening stores have always changed, the trend is that the threshold is constantly lowering.
"Now the threshold for TikTok Shop UK sites is already very low, account holders are over 18 years old, account posts 5 short videos and get more than 100 likes to apply for opening, and support cross-border sales, no need for local stocking." Na Xin's feedback was consistent with Gu Jun.'s. He explained that in Indonesia and other southeast Asian countries, local companies are currently required to prepare local goods before they can open stores, which is the threshold faced by Chinese sellers, so in addition to the main business of red person marketing, cross-border live broadcasting, brand account operation, platform optimization and other main businesses, PONGO now also provides some supply chain warehousing services for sellers in need.
With TikTok as the fulcrum, what this group of gold diggers want to leverage is its large and diverse user base. According to data cited by PONGO from Hootsuite, TikTok has a global advertising audience of 825 million, of which 56.1% are women, 43.9% are men, and the proportion of young people aged 18-24 is 45%. A report by App Annie last September showed that TikTok UK and US users spent more than 24 hours a month on TikTok, higher than YouTube.
App Annie data shows that the average monthly user time of TikTok in the United States (left) and the United Kingdom (right) has surpassed YouTube (Android device data)
For sellers, emerging traffic pools also often mean lower costs. Especially after the rise of the standalone model, traffic channels have become more important. Compared to the high cost of platforms such as Facebook, Instagram, And YouTube, and the accuracy that may decline due to the new privacy policy for iOS, TikTok gives a more cost-effective entry to reach customers.
Although some practitioners have raised concerns that the upward trend of traffic costs will inevitably increase as competition intensifies, it is imperative to seize this not-so-long traffic dividend window.
This is another consensus in the industry, the dividend period will not be too long, start quickly.
狠掘金
Where to start? The answer given by several practitioners is "content".
The purpose of consumers determines that the logic of short video platforms selling goods and e-commerce platforms doing live broadcasts is different. When people open an e-commerce platform, there is usually a clear goal, but the short video/live broadcast platform is creating and stimulating demand, and the tool to complete the planting is the content. Good content can grasp the algorithm and seize the consumer.
Therefore, content has become the most difficult and most urgent threshold for brands and sellers to level. A seller who was also eager to take the TikTok live broadcast a few months ago decided to give up after careful research, frankly saying that "overseas live broadcasting is not understood, and there is no cost to burn."
Newme has now set up 6 live broadcast rooms, 4-6 hours a day, due to the time difference with the United Kingdom and the United States, people in China's anchors day and night upside down is also a common thing, the matrix has at least 7 short video accounts, releasing original or secondary content. Newme's anchors are mostly foreigners in China or Chinese with foreign trade experience and authentic language, gu Jun's explanation is that "Chinese anchors are responsible for sales capabilities, and foreign anchors are responsible for trust." The entire content team not only sells Newme's home furnishing products and creative small products, but also operates for other Chinese brands going overseas.
Newme's live room
Unlike "95% of domestic sales rely on live broadcasting, 5% rely on short videos", according to Newme's experience in the British and American markets, 70% of sales come from short videos, and only less than 30% come from live broadcasts. "It's still a matter of consumer habits, they don't know about (European and American users) live shopping." I hope we can balance our efforts on both ends, after all, short videos and live streaming bring different category opportunities. Gu Jun said.
PONGO slowly explores the rules of content in practice. When looking for celebrities and incubating live teams, PONGO will first target local waist creators on video platforms, with the criteria of "bias towards ordinary people, more relevant to key categories, and high interaction rate of output content". "Real" and "interesting" are the two keywords that Na Xin mentioned many times in the dialogue, compared to strong sales ability, how to naturally display and recommend products to attract the audience, and then precipitate consumers to the private domain through operational means is more important.
In the cooperation and docking link between the brand and the celebrity, PONGO's content team will communicate with both sides to further digest the materials, plan the content, sort out the highlights of the publicity, and even refine it to a video with several product shots. PONGO uses "central kitchen" content production teams and localization mechanisms to accelerate the process and methodology of matchmaking.
Wave after wave of content trends, cultural differences and consumer habits in different countries and regions are variables on the path of exploration.
And "a funnel and a plate of goods" is the eternal formula of sales - how to use traffic to convert and precipitate through content? How to select products, build supply chains, pull through logistics and warehousing? It's all an unavoidable question for incoming TikTok.
In the selection session, Gu Jun, founder of Newme, summarized three easy-to-understand principles, "super cheap goods, fresh categories from zero cognition, and obvious differences before and after use." The content and dissemination characteristics of short videos/live streams have unexpected effects, and a fitting example is the emoji mask. The blockbuster that brought Newme tens of thousands of sales was not hot on Amazon for several years, but the viral spread of TikTok content pulled sales.
At present, Newme has 300+ SKUs, and the test side is still on the new 3-10 SKUs every day. Gu Jun's logic is to start from the scale, and then narrow to do fine products, with this logic, Newme has also built a new subdivision category station, and gradually moved from the OEM model to the ODM model at the supply chain end, giving full play to the mature design capabilities of Chinese factories.
In the Southeast Asian market that PONGO is familiar with, it is easier for users to pry their minds, so there are many similarities with domestic video e-commerce in terms of product selection logic, focusing on "just need" and "cost performance" and "small upgrades", and traditional overseas categories such as 3C, beauty, and clothing have a broad space for growth.
The supply chain has been analyzed as the core secret of the myth of the rise of SHEIN, and the "small single fast return" model has been widely investigated. But I have to admit that before the sales outbreak, SHEIN experienced many years of dormancy, as well as stimulus factors such as the Sino-US trade war and the epidemic. For new brands, especially for sellers who are not transformed and upgraded from factories, it is almost impossible to copy in a short period of time. Gu Jun also mentioned his "survival anxiety", when sales have not yet opened, how to obtain the best quality supply chain resources is still a problem.
In terms of logistics, although TikTok has deployed third-party service providers everywhere, the gap is still there compared with mature e-commerce companies such as Amazon in terms of logistics speed and after-sales response efficiency. In markets that require local stockpiling, sellers' warehousing and logistics costs are also growing.
TikTok e-commerce is going to "take off", but it has not yet reached the node of volume change. The catalyst may be an event, a big anchor, a viral explosive. Away from this profit-first business, the more pressing big question is, since the era of foreign trade, Chinese sellers and factories have been selling goods for many years, have they already had the thinking and confidence of the brand to go to sea? Can TikTok set up this springboard for them?