Douyin officially launched the supermarket business
On the first day of the new year, Douyin released a big move: Douyin supermarket.
Unlike the previous pilot business, at present, the Douyin supermarket business has officially opened its doors in the Douyin APP, and users from all over the country can conduct online supermarket shopping experience in Douyin.
Through the search bar of the Douyin APP, we can search for the official account and supermarket entrance of Douyin Supermarket.
After entering the Douyin supermarket, the overall interface is relatively simple and clear. The top shows the main business categories, mainly including "milk drinking, paper laundry, wine health care, household cleaning, personal care and beauty, snacks and sugar smart, mother and baby pets, grain and oil fast food, electrical appliances and department stores" nine categories, basically covering the commodity categories operated by supermarkets.
It is worth mentioning that on the payment page of Douyin Supermarket, the platform has provided a variety of common payment methods, including Douyin payment, Alipay payment, WeChat payment and so on.
In fact, as early as October 2022, there was industry news that Douyin Supermarket opened investment promotion, and the pilot cities include Guangzhou, Shenzhen, Huizhou and Dongguan, and consumers in these cities can find the entrance to the "supermarket" in Douyin Mall.
In the pilot cities, the specific service model of Douyin supermarket, in addition to the next-day e-commerce supermarket, also includes the "hourly delivery" function operated by local life service merchants, and the main commodity categories are flowers, vegetables and fruits.
According to Tianyancha information, in November 2022, Beijing Zidao Network Technology Co., Ltd. has applied for the registration of the trademark "Douyin Supermarket", and the international classification involves advertising sales, education and entertainment.
It can be said that after many tests in the second half of 2022, in 2023, Douyin supermarket will become an important development direction for closed-loop e-commerce on the platform.
Behind the official launch of Douyin Supermarket, the comprehensive e-commerce trend of Douyin has become unstoppable.
Logistics and supply chains are difficult problems
In fact, since Douyin registered the "Douyin Supermarket" trademark, it has set off a big discussion on this business in the industry, and on the whole, there is only one core question that everyone is concerned about: Douyin Supermarket, can it work?
Let's take a look at the model of Douyin supermarket first.
Douyin is a direct business similar to Jingdong Supermarket, which is developed by ByteDance's e-commerce department and belongs to two teams with Douyin's local life business. In other words, Douyin Supermarket belongs to the business of Douyin e-commerce.
On the official page of the supermarket, there are currently three core experiences of Douyin Supermarket, "official direct delivery", "door-to-door delivery the next day", and "free shipping over 88 yuan".
From the perspective of page mode and services provided, the current Douyin supermarket is very similar to Tmall supermarket and Jingdong supermarket. For example, Tmall Supermarket also provides next-day delivery mode, free shipping over 88 yuan.
In addition to these, Douyin has a key competitive advantage: traffic. Data shows that in 2022, the number of Douyin users will be around 842 million, and the number of daily active users will exceed 700 million.
As of October 2022, Douyin's commercial service has covered 377 cities across the country, and the overall transaction amount has increased by more than 30 times compared with last year.
Similarly, the Douyin supermarket project is also likely to usher in explosive growth in a short period of time. Moreover, Douyin supermarket also complements the grand strategy of Douyin e-commerce.
In August 2022, Douyin e-commerce announced internally that it will mainly do shopping malls and brands in the future, and supermarkets are an important step for shopping malls and brands.
Because supermarkets mainly provide a series of products with higher repurchase rates, higher standards and more concentrated branding. Such as all kinds of drinking water, shampoo, grain and oil and other products.
These high-frequency products that can meet the needs of users' daily necessities can not only bring a higher repurchase rate and user stickiness, but also further enhance the branding of Douyin e-commerce.
Moreover, online supermarkets can not rely on live streaming to bring goods, and the shelf e-commerce promoted by Douyin can share the supply chain behind it.
In other words, Douyin not only has traffic and content advantages, but also is consistent with the strategic development direction of Douyin e-commerce, which is very in line with the closed-loop layout of e-commerce on the whole platform.
Talking here, it seems that the future of Douyin Supermarket is bright, but everything has pros and cons, and there are many problems in front of Douyin Supermarket.
The first is the supply chain of the supermarket business.
Big brands and standard products can help Douyin's branding strategy improve quality and increase repurchase rate, but competition in this field is extremely testing the platform's supply chain capabilities.
Tmall Supermarket and Jingdong Supermarket have been deeply engaged in the supply chain for many years, with large shipments, and have good negotiation power in front of suppliers. Correspondingly, it will also be able to obtain better prices and products, and for Douyin e-commerce, the supply chain construction of these fast-moving consumer goods brands needs to be quickly completed.
At present, Douyin is still mainly based on price subsidies and seizing market share, but in the future, to continue to expand market share and optimize the profit model, it is a key issue to solve the supply chain.
In addition to the brand and supply chain, the biggest problem for Douyin is logistics and distribution.
Previous news shows that Douyin has reached a cooperation with SF, and SF will undertake the future delivery business. And since the second half of last year, Douyin has successively announced cooperation plans with a number of delivery platforms, including:
In August 2022, Douyin cooperated with Ele.me to provide users with logistics and distribution services; In September, JD Express, Zhongtong, Yuantong, Yunda, SF, etc. connected to the Douyin e-commerce "Yinqiuda" service to provide Douyin users with high-quality delivery services such as home delivery; In December, Douyin reached cooperation with Dada, SF City, and FlashSend to provide "group purchase delivery" services, gradually realizing the group buying package "average 1 hour in the city".
In this series of collaborations, we see the importance that Douyin attaches to logistics. Quickly making up for the shortcomings of distribution through cooperation is indeed the best choice for Douyin at present, but in the increasingly fierce industry competition in the industry, cooperation is not the optimal solution.
Compared with JD.com's own JD Express and Alibaba's Cainiao Logistics, the adoption of a cooperation model in the distribution link will further increase the number of transaction links.
For next-day, half-day, hourly delivery, and other supermarket delivery businesses with high timeliness requirements, Douyin supermarkets need to store products in the warehouse of the logistics platform in advance, or reach warehousing cooperation with local physical supermarkets. Warehousing logistics management is also an urgent problem that the platform needs to solve.
The increase in transaction links will inevitably lead to an increase in costs, and at the same time, the model of third-party platform cooperation also tests the platform's control of the quality of distribution services.
On the whole, if Douyin wants to build a complete closed-loop e-commerce transaction, it is not only traffic, but also needs to build a mature and stable supply chain and logistics distribution system. And this is the killer feature of traditional e-commerce such as Tmall and JD.com.
Can TikTok catch up
Douyin as a supermarket, has a natural traffic advantage, complements the strategy of shelf e-commerce, and also means that Douyin will attach great importance to the development of supermarket business.
But when jumping out of Douyin supermarket and coming to the broad track of e-commerce supermarkets, we can see that the current supermarket business is different from the era of Tmall supermarkets and Jingdong supermarkets.
In the e-commerce supermarket industry, in addition to such supermarket forms of next-day delivery, free shipping threshold, and genuine product guarantee, supermarkets have gradually combined with offline physical stores in recent years, and many new formats have been born in the industry.
Specifically, there are mainly these new players:
In May 2022, Ele.me launched its "all-round supermarket" business in many places across the country, providing fresh food, grain, oil, rice and noodle supply services in the form of "community collection and designated distribution". The delivery mode is half-day.
In October of the same year, Meituan Youxuan upgraded its brand positioning to "Tomorrowday Supermarket", which will improve the "last mile" consumer experience through a network of pick-up points covering urban and rural areas. The service model of "order today, pick up the next day" on Meituan's preferred platform has covered nearly 3,000 cities and counties across the country.
There is also JD.com, after continuing to integrate with Dada Group, JD.com will integrate physical supermarkets with instant retail, and during Double 11 last year, the "hourly delivery" service covered more than 1,800 counties, districts and cities across the country, and more than 200,000 physical stores have achieved this service.
It can be said that in the current e-commerce supermarket track, in addition to the next-day delivery model of Douyin supermarket, multiple modes such as half-day delivery, next-day pick-up, hourly delivery and even half-hour delivery are participating in the competition.
Based on this, Douyin has also laid out the supermarket business of "hourly delivery", which means that the competition of Douyin supermarket will face a situation of double-line combat and multi-faceted completion.
The form of industry competition is richer, and consumers' choices are more diverse, but for the nascent Douyin supermarket, this is another important test.
From the current point of view, Douyin supermarket is part of Douyin Mall, which is not particularly different from the current "supermarket" business launched by JD.com, Ali and Meituan, and does not show many differentiated advantages.
As for whether it can do well in the future, it depends on whether Douyin can make up for the shortcomings in logistics and supply chain.
In general, like traditional e-commerce platforms, e-commerce supermarkets have long been not a new thing in the industry, and now, the difficulty of latecomer Douyin to successfully enter the highly competitive Red Sea market is not small. We can even say that it's a little too late to do supermarket TikTok now.
However, the Internet world has never lacked the myth of "latecomers prevailing", and we need to continue to pay attention to how far Douyin supermarkets can develop.
Author | Old electricity