In recent months, Amazon has focused heavily on live streaming, but the sales of live broadcasting have been miserable, and Facebook's live streaming has not done well. Why do the domestic live broadcast goods repeatedly suffer in the European and American markets? Let's take a look.
In recent months, the life of e-commerce giant Amazon has not been good. Due to the lack of performance growth, Amazon bet heavily on live streaming.
During this year's Amazon Membership Day (equivalent to the domestic 618 promotion), Amazon invited comedian Kevin Hart, model Miranda Kerr and other stars, as well as many Tik Tok, Instagram head influencers, held a series of live interactive activities, viewers can buy products through the scrolling carousel below the video.
Influencers build momentum for Amazon Membership Day
According to statistics, the daily turnover of this year's membership is 11.9 billion US dollars, an increase of only about 8% over last year. Referring to 2016-2019, the average growth rate of its membership day sales is as high as 66.6%, and the sales growth rate this year is really unbearable. Replaced by a domestic Internet factory, the event planner was pulled out and shot for 5 minutes.
Coincidentally, Facebook also suffered Waterloo on live streaming, and will roll off the live streaming function on October 1, 2022.
TikTok's live streaming platform, TikTok Shop, also recently suffered a setback in the UK, abandoning plans to expand live streaming to the US and other parts of Europe.
Why do the domestic live broadcast goods repeatedly suffer in the European and American markets?
This involves the following factors:
- Mediocre merchandise discounts
- Crotch-pulling logistics system
- Decentralized consumption habits
- Strict market regulation
01 Mediocre merchandise discounts
The core of live streaming is the price! It's the price! It's the price! Say important things three times!
Domestic live streaming sales are basically concentrated in the head anchor, and the head anchor often has a very mature supply chain team behind it. A mature supply chain can optimize many unnecessary costs by itself. Coupled with the bargaining power brought about by the huge traffic, the cost price obtained by the anchor team from the supplier is often really the lowest in the whole platform.
With low-cost support, the discount of goods in the live broadcast room can often be as low as unimaginable, and it is more than 50% of the discount at every turn, you say that the incense is not fragrant, too fragrant!
But do you know where the cheapest goods in Europe and the United States can be bought?
Not online! It's offline!
Large malls such as Walmart, COSTCO, and outlets often offer the lowest prices on the market. Large offline shopping malls in Europe and the United States have decades of experience in supply chain construction, and they are in full swing in cost control. Coupled with the high penetration rate of vehicles in Europe and the United States, large shopping malls can choose some remote locations to further reduce operating costs.
In contrast, the live streaming supply chain in Europe and the United States is basically a scattered operation, there are few clustered supply chains, coupled with high labor costs, and it is really more than enough to fight down the cost of goods.
European and American consumers are not stupid, in the continuous price comparison, they will naturally vote on their feet and choose the lowest price purchase channel. Live streaming with goods offline shopping malls to chase and intercept, the advantages are difficult to play.
02 Logistics system for pulling crotches
In China, thanks to a strong logistics network, many e-commerce platforms have been able to achieve next-day delivery, same-day delivery, and even 1-hour rapid delivery.
This kind of speed is unimaginable in Europe and the United States. After placing an order online, it is common to wait for 7 days to receive the goods. What the? You said you waited 15 days to receive the goods? Sorry, that's also a routine operation, please get used to it.
Why is the logistics in Europe and the United States so crotch-pulling?
Is there no money? Of course not! The highways in Europe and the United States are very developed, and the main problem lies in labor relations. European and American truck drivers are often dissatisfied with the treatment, love to strike at every turn, express delivery companies in order to calm the anger of workers have been exhausted, most of the income is also used to pay for labor costs, even if there is any heart to build a logistics system. If you find out that your overseas courier has not been heard for 1 month, it may be because of a strike in a certain city.
The shopping experience online is not much better than offline, so why not go to an offline mall? In terms of receiving time, the online live broadcast was hung by the offline mall.
03 Decentralized consumption habits
The habit of online shopping needs to be cultivated, when Taobao was just established, there were not too many consumers in China to buy online, after more than ten years of development, there are now large-scale online consumers.
The same is true in Europe and the United States.
At present, European and American consumers are gradually beginning to accept online shopping, but they are more inclined to go to the brand's official website to shop. For example, when buying shoes, you can buy them directly on the official websites of NIKE and ADIDAS.
According to statistics, 50% of the online transaction volume in the European and American markets comes from the brand's official website. The dispersion of consumer shopping habits makes it difficult for the live streaming giant to be born.
Usually, the audience of the live broadcast room with goods does not exceed 100 people, and even the most lively Amazon official live broadcast room is difficult to break through 10,000 online during the membership day.
3,400 people are online at the same time during the Amazon Membership Day livestream
Most of the anchors faced a sparse audience, worked hard in the live broadcast room for a day, and finally only single-digit transactions. What are they trying to do? The money you make from an hour or two of selling on the street may exceed the turnover of a whole day in the live broadcast room.
It is impractical to generate electricity with love, and anchors and enterprises that have not made money have withdrawn from the cruel battlefield of the live broadcast room in order to survive.
04 Strict market supervision
In the domestic live broadcast room, we often hear many exaggerated words. Slogans such as "the lowest on the whole network" and "only this one" made the audience's blood boil. The little hand shook, and unconsciously it was routined.
At the same time, in order to attract popularity, some financially strong live broadcast rooms often sell goods below the cost price. Don't make any money, you say consumers buy it or not?
But in Europe and the United States, you dare to use this method to live broadcast, and punish you every minute until you go bankrupt.
The first is the Advertising Act. As long as there is a problem with the wording, there is a risk of huge fines. New Balance was sued for false advertising for advertising claims that it could help burn calories, and eventually paid a $2.3 million settlement.
Then there's the antitrust law. The sale of conventional goods below cost price is itself an unfair competition, which directly squeezes the living space of small enterprises. In order to promote e-books, Amazon has ordered that it is not allowed to make a profit, and has priced dozens of dollars of e-books at $10 or even $1, making money at a loss. Amazon was therefore subject to a class action lawsuit and had to put the price back to normal levels.
In addition, there are many laws that restrict the operation of the live broadcast room, as long as you are not careful, there is always a law that can make the live broadcast room shut down.
The anchor of the live broadcast room can not brag about how good this product is, can only use simple and objective words to describe, the price is not advantageous, the audience is impulsive, rationality overcomes sensibility, so everyone has chosen to "not buy 100%".
Is live streaming really not feasible in foreign countries?
No! Although live streaming goods frequently kicked the iron plate in Europe and the United States, in Southeast Asia, live streaming goods showed a rising trend.
The 2021 Southeast Asia Internet Economy Report pointed out that the scale of Southeast Asia's e-commerce economy will reach $120 billion in 2021, with an average annual compound growth rate of more than 60%. The rapid growth of e-commerce has brought a solid foundation for live streaming.
Due to the similarity of culture, urban structure and domestic, Southeast Asian live streaming with goods has largely avoided water and soil dissatisfaction, coupled with the geographical proximity, logistics are also more friendly.
Southeast Asian live broadcast with goods imagination space is huge. Southeast Asian e-commerce giants Shopee and Lazada have laid out in-app live broadcast functions. A number of domestic brands have begun to settle in. TikTok's layout in Southeast Asia this year has accelerated the development of live streaming.
Domestic brands settled in Lazada and Shopee
However, the live broadcast environment in Southeast Asia is still immature, and supervision needs to be rectified. In the future, who will die with overseas live broadcast goods, and wait for time to reveal the answer.
This article was originally published by @Old Deer Lucas on Everyone is a Product Manager. Reproduction without permission is prohibited
The title image is from Unsplash, based on the CC0 protocol
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