Three years after Luo Yonghao's shaking, live streaming has also become a traditional industry

On October 10, 2017, anchor Weiya brought goods to a fur shop with zero fans, and sold 70 million in five hours. Jiang Fan, then president of Taobao, praised in a public speech: "The achievement of a live broadcast watched by millions of people and hundreds of millions of transactions is no longer an embellishment, but the mainstream of future business models." ”

According to data from NetEconomics, in 2018, the annual market size of live streaming e-commerce was 135.41 billion, an increase of 589.46% compared with 2017. By 2022, the annual market size of the live streaming e-commerce market has reached 3.5 trillion, an increase of 25 times compared with 2018, accounting for a quarter of the entire online e-commerce market share. As Jiang Fan expected, live streaming e-commerce has truly become the mainstream of today's business model.

However, it is not only Taobao Live that has made the live streaming e-commerce industry mainstream today's business model, and the time has returned to the critical point of 2020, when the new crown virus began to pandemic globally. Before this, although the growth rate of live streaming e-commerce was also very fast, after all, the overall market size was only hundreds of billions. The industry is also almost dominated by Taobao live broadcast, JD.com's participation has not made a splash, Kuaishou has only won a market of about 40 billion, and Douyin's KOLs are more willing to try short videos to bring goods and reverse Taobao.

The pandemic has changed all this, with users restricted from traveling, and various offline business models have been shut down, leaving them to seek support from online channels. The rapid development of live streaming e-commerce in the first two years has just hit the user's urgent psychology for online consumption, Kuaishou has increased investment, Douyin has followed suit, and the times have begun to change dramatically.

Live streaming e-commerce has brought a new imagination to the long-dormant industry and gradually become a "myth". Even among the population who do not know the industry, "the end of everything is live broadcasting" has become a popular slogan. It seems that as long as it is blessed by live broadcasting, any traditional industry can be brought back to life.

The myth continues, and the market continues to expand. Until the end of 2021, Taobao's top anchors Sydney and Weiya were successively banned for tax evasion. The industry still maintained growth after stepping on the brakes, but looking back, live streaming e-commerce seems to have gradually lost the attention of the public opinion field since then. Li Jiaqi, who disappeared for a short time, no longer published war reports after his comeback, and people lost a sensational topic that sold 10 billion.

Even now, news such as "Luo Yonghao live selling satellites" can still scratch the attention of the public opinion field from time to time, but both in the industry and outside the industry have long lost interest in discussion. A sales of tens of millions or hundreds of millions is still worth sending a war report, but the public opinion field, which is accustomed to seeing the wind and waves, has no intention of caring at all.

When we look back at the history of live streaming e-commerce in the past three years, when all practices lead to the same business logic, those once surging and fresh business imaginations will eventually be forgotten.

Myths gradually become banal and boring after becoming routine, but new platforms are still expecting myths to come again.

The birth of myths

On February 21, 2020, Luo Yonghao launched a poll on Weibo, which read: "Do you watch e-commerce live broadcasts when you buy things?" Or, do you watch e-commerce live streaming to buy things? After 37,000 people voted, 26,000 answered "no."

Before this vote, live streaming e-commerce already had a large market size. In 2019, Weiya has sold 3 billion goods during Double 11, and the annual market size of live streaming e-commerce reached 443.7 billion. But with only 4.3% industry penetration, the message is that most consumers still don't know what live streaming is.

The sudden arrival of the pandemic has changed the pattern of existing markets. After January 16, the shortage of hygiene products allowed live streaming e-commerce to find the password for traffic growth. According to Karth Data, during the entire Spring Festival, the sales of masks and disinfectants topped the list of Taobao's top 20 popular products. Li Jiaqi also sold disinfection gift boxes in the live broadcast room.

According to data released by Zhongtai Securities Research Institute on February 7, 2020, in the past 14 days, the average number of viewers per game of Taobao Live has increased by 43.13%, and the average number of views per game has increased by 30.05%. This rapid increase is difficult to detach from the restrictions brought about by the epidemic.

Many brands and merchants' offline sales channels have also been seriously affected, and the industries represented by clothing, automobiles and even education themselves have a strong dependence on offline. The dividends of live streaming e-commerce have long been noticed by some people in the industry, but they do not have a strong driving force. Until the mall was closed, the offline channel disappeared almost overnight, and live streaming became a new channel that they could hope for.

Some brands began to try to live broadcast on Kuaishou and rushed in both directions with platforms that are working on live e-commerce, and many successful cases appeared, and live streaming e-commerce began to show its magic of transforming traditional industries. In addition to the traditional live streaming of goods, Kuaishou has also launched the "Kuaishuo" business, which has the ambition to challenge the traditional car sales system.

In March of the same year, a group of entrepreneurs represented by Ctrip Liang Jianzhang and Gree Dong Mingzhu came online with goods that they could not sell offline. Liang Jianzhang sold a hotel package worth 10 million yuan in one hour of his debut, and Dong Mingzhu's debut sales on JD.com even exceeded 700 million.

In the past, the air conditioning home appliance business had a strong local channel color. Brands need to rely on local agents to sell their wares to thousands of households, but now this middleman is cut straight and replaced with a platform with more efficiency and less commission.

The wind came almost overnight, and according to China Business Daily, also in March, the Guangzhou Municipal Bureau of Commerce issued the "Guangzhou Live E-commerce Development Action Plan (2020-2022)". It mentioned that Guangzhou will be built into a famous live streaming e-commerce capital in the country. By 2022, promote the implementation of the "explosive" project of live streaming e-commerce to catalyze the real economy, that is, build a batch of live streaming e-commerce industry agglomeration areas, support ten head live broadcast institutions with demonstration and driving effects, cultivate 100 influential MCN institutions, incubate 1,000 Internet celebrity brands, and train 10,000 delivery experts.

On March 21, Taobao's first live shopping festival was launched, and many brands started live streaming under the demand of users created by the epidemic. During the shopping festival, Estée Lauder broadcast continuously in the live broadcast room of her own store for 15 hours, and the transaction volume increased by 30 times compared with the daily one. The live broadcast room transaction of Suning's flagship store increased by 719% year-on-year.

Big players

Just two days before Taobao launched its first live shopping festival, Luo Yonghao announced on Weibo, "After reading the famous research report of China Merchants Securities, I decided to do e-commerce live broadcasting. Before the announcement, Luo Yonghao also said: "At first I thought it was a zero-sum game that did not create any new value. ”

A "zero-sum game" means that one party's gains will inevitably bring losses to the other. Luo Yonghao's "self-reflexiveness" means that he believes that live streaming e-commerce brought more increments at that time than robbing the existing stock of the market.

On April 1, exactly three years ago, Luo Yonghao started broadcasting on Douyin, selling 910,000 products in 3 hours, achieving a total of 48 million views, and GMV exceeded 110 million on that day. On that day, Douyin released a war report, directly calling Luo Yonghao "a brother with goods".

A few nights before Luo Yonghao's live broadcast, there was still an undercurrent surrounding the ownership of the live broadcast platform. According to Tech Planet, Luo Yonghao first contacted Douyin, "originally the cooperation has basically been negotiated, Luo Yonghao announced that he will do e-commerce live broadcast, the response was enthusiastic, many found cooperation, and opened a round of cooperation negotiations, and also contacted other platforms", a person familiar with the matter revealed that Douyin finally increased the number of cooperation resources, and the matter was finalized.

Before this, Douyin's position in e-commerce, more to Taobao e-commerce backwards, its own attempt for e-commerce, is mainly short video goods, 2019 618 promotion, won the first place in Douyin e-commerce expert GMV (based on Alimama statistical results) is beef brother, behind the company CEO Li Rongxin told the industry self-media, short video goods and live streaming goods are essentially a huge difference, this difference is also the core difference between Douyin e-commerce and Kuaishou e-commerce.

Douyin's lack of private domain traffic was generally considered to be the reason why it could not do live streaming e-commerce at that time, and some practitioners believed that "only Kuaishou and WeChat can challenge Taobao's structure" when analyzing the market situation, and Douyin is not on the list.

The industry is generally skeptical about whether Douyin can do a good job in live streaming e-commerce, and this suspicion was broken after Luo Yonghao's arrival.

As early as before Luo Yonghao settled in, Douyin tentatively opened live streaming goods. At the end of 2019, Douyin launched several live broadcast policy reforms internally. Some anchors represented by the "Big Wolf Dog Couple" can sell tens of millions of sales at a time. In March 20, Liang Jianzhang's live broadcast debut, the place where 10 million hotel packages were sold, was also Douyin.

However, tens of millions of sales were not particularly bright in the market where a single sale often exceeded 100 million, and although Douyin's series of actions made many MCNs look forward to it, they did not attract more attention. Luo Yonghao's joining, in addition to bringing a single sales of 110 million, is more of a huge human-type advertising effect.

Some insiders said that Luo Yonghao's addition has brought at least two effects. "On the one hand, let more brands and merchants know that Douyin can also sell goods; On the other hand, it is to let Douyin users know that they can also buy goods on Douyin. ”

Douyin, who had been making trouble for a long time, quickly rose after grabbing Luo Yonghao's handle. Statistics a year later show that Douyin's live streaming e-commerce GMV reached 500 billion in 2020, more than 5 times more than in 2019.

The transformation of the content platform into an e-commerce platform itself has a natural gully, which is the limitation of the "field" of live streaming goods, because the natural purpose of users entering the content platform is not to consume, but to watch content. But Douyin's huge traffic compensates for this disadvantage to some extent. The emergence of Luo Yonghao as a head anchor, and the layout of more supply chains and brands, have further consolidated Douyin's live streaming e-commerce plate.

Speed down

Before Jitter, the focus of live streaming e-commerce was e-commerce, that is, the live streaming of e-commerce platforms. This is a relatively easy path, users originally have to spend on e-commerce platforms, and after increasing the function of live broadcasting, it further stimulates users' desire to consume. Or in official terms, it can make the brand more direct to consumers.

However, the transformation of jitter as a content platform has turned live streaming e-commerce into e-commerce of live streaming platforms. According to the financial report, as early as before the opening of the live broadcast e-commerce business, about half of Kuaishou's revenue came from the live broadcast business, and live broadcast itself is the most popular form of content of Kuaishou Laotie, but it is more inclined to entertainment live broadcast or show live broadcast than e-commerce live broadcast.

Trust e-commerce rooted in Kuaishou culture was born, and the almost unconditional trust of old irons in anchors led to the birth of this business model. The existence of six major families, such as Simba and Sanda, has achieved a role similar to Luo Yonghao's role in Douyin in the form of native head anchors.

The three-pronged pattern of Taobao, Douyin and Kuaishou has taken shape. The three were originally platforms with completely different attributes, but they became the Big Three in the same industry. It's just that the different "fields" of the three platforms have ushered in different fates.

On the eve of Double 12 in 2021, Taobao's head anchor Sydney (CEO of MCN Chenfan) was banned for tax evasion. And just over ten days later, the largest anchor on the whole platform, "Weiya", was also "disappeared from the Internet" overnight for the same reason. During Double 11 before being banned, Wei Ya had just rushed to the hot search because she and Li Jiaqi sold nearly 20 billion goods.

At the media inquiry meeting on the evening of Double 11 that year, Yang Guang, then vice president of Ali and vice president of Tmall Business Group, also answered a question related to "Taobao Live aggregating traffic on the head of two anchors", saying that "it is difficult for the platform to intervene".

Weiya's sudden disappearance made the platform feel the consequences of not intervening before. The following year, the 618 promotion coincided with Li Jiaqi's suspension of broadcasting. According to a third-party data platform, Taobao Live ranked third for the first time in the platform war during the promotion, and its total sales were no match for Ji Kuai.

For Taobao, the negative impact of the disappearance of super anchors continues. Statistics at the end of 2021 show that Taobao Live's GMV for the whole fiscal year was 500 billion yuan, an increase of about 25% compared with 400 billion yuan last year, which is far lower than the industry average growth rate of 83.77%.

Kuaishou also has super anchor syndrome, in 2019, Kuaishou annual GMV is about 40-50 billion, Simba's team GMV accounted for nearly one-third. Since 2020, Kuaishou has increased its investment in live streaming e-commerce, and also unblocked the previously banned head Internet celebrity Erdonkey, allowing representatives of the six major families to cooperate with various stars in live broadcasting, and introducing more brands and merchants.

The abundant traffic and the gradual cutting of the domain have allowed Kuaishou to gradually take back the initiative of the traffic. Simba's violent words in the live broadcast room from time to time can still poke Kuaishou's nerves, but they can no longer hinder the overall situation. On March 29 this year, Kuaishou released its financial report showing that the total GMV of Kuaishou's live streaming e-commerce reached 900 billion yuan, an increase of about 32% compared with 680 billion yuan last year.

Myths fade

In June 2022, Oriental Selection exploded on Douyin. This MCN, co-created by Yu Minhong, founder of New Oriental, is infused with the painstaking efforts of New Oriental's transformation. Prior to this, a document brought the K12 education and training industry to naught, and New Oriental's stock price fell by 90%.

Yu Minhong personally brought the goods, but he was not able to revitalize the Oriental selection. Until the appearance of lecturer Dong Yuhui, bilingual goods and even knowledge goods in the live broadcast room caused a climax of public opinion. Soon, Oriental Selection reached about 30 million fans on Douyin, and quickly grew into a head live broadcast room.

New Oriental finally succeeded in self-help in Douyin along the existing path of bringing goods, rather than Douyin transforming its education industry, which is undoubtedly a metaphor, one logic triumphs over another, indicating that this combination is not the birth of imagination, but the disappearance.

The disappearance of imagination still exists in all aspects, Dong Mingzhu, who sold 700 million yuan on JD.com during the epidemic, is now no longer carrying goods, and live streaming e-commerce provides Gree with a new channel, but it is obviously difficult to replace its intricate offline agency system.

New Oriental's education and training industry once hoped to transform education with online live broadcasting, but not long ago, a notice from Douyin canceled all paid content for knowledge, and the change of the industry was stopped at the platform policy level. As for car sales and even real estate sales, which were once pinned on hope, except for a small number of cases that were supported by platform traffic, there has been no real improvement.

The myth of live streaming is still the embodiment of traffic logic, not the evolution of any business model. After the wind of touting Oriental Selection's "knowledge with goods" and "content evolution" passed, Oriental Selection returned to the traditional path of "bringing goods is bringing goods". As long as you watch a few more live broadcasts of Oriental Selection, you will find that the "knowledge" content of Oriental Selection has been greatly reduced.

New Oriental's stock price, which was already moribund, rebounded rapidly after the success of Oriental Selection. Yu Minhong, who was almost portrayed as a frustrated businessman, was not easily defeated as Duan Yongping said, but stood up again. But this myth only belongs to Yu Minhong and New Oriental, and has nothing to do with any business model change.

Live streaming e-commerce used to be a myth that transformed the industry, but now it seems that it is more often just a "wealth myth". The latest data shows that the live streaming e-commerce market will reach 3.5 trillion yuan in 2022, with a market penetration rate of 25.3%, and by the end of 2021, the number of employees will reach 10 million. Myths have indeed changed the traditional business logic to a certain extent, and have given most brands and merchants a chance to come all over again.

But the myth ends there, when countless possibilities return to one possibility, live streaming e-commerce itself becomes a "traditional industry". Traditional industries sound far less glamorous, and of course, there are many more emerging platforms waiting for the myth to come back.

In the front, there is Station B, and after there is Xiaohongshu, they are all pinning their hopes on live streaming e-commerce to become the company's cash flow. However, the transformation of content platforms that have not yet exceeded 100 million daily to e-commerce platforms, I am afraid that the road crossed in the middle may require a real miracle.

On March 31 this year, Luo Yonghao sold a satellite for 1 million yuan in the live broadcast room, forming a curious and comedic effect. This incident did not attract much attention, and Luo Yonghao, who sold mobile phones, became Luo Yonghao, who sold goods, which was exciting enough. But Luo Yonghao, who sells goods, will not be interesting to sell satellites again.