2024 Taobao is fighting against the water

Image source@Visual China

文 | 新眸，作者 | 鹿尧，编辑 | 桑明强  

"The era of AI e-commerce has just begun, and it is both an opportunity and a challenge for everyone. "After many years, when Mr. Ma appeared after a long absence, this time he brought a new tip to Taobao.  

According to the founder's practice, from the "e-commerce" in the entrepreneurial period to the "new retail" that he later promoted, including the current "AI e-commerce", his previous predictions were all aimed at bringing a subversive innovation to the industry. The difference is that this time there is neither a precedent to follow nor enough data to validate compared to the past.

The current situation of Taobao is also different from the past.

According to a Goldman Sachs report, Taobao Tmall's market share has dropped from 66% in 2019 to about 44% in 2022, a four-year decline of about one-third. Until the end of last year, with the market value of Pinduoduo surpassing Alibaba, and the rapid rise of content e-commerce such as Douyin and Xiaohongshu, no one expected that content e-commerce and the sinking market would become the weakness of Tao e-commerce.

For a long time, people would equate the development of Taobao with the epitome of the domestic e-commerce industry.

It was born the earliest, the largest, and the most able to reflect the changes in the consumer market and public demand: before All In Wireless, it was more about the almighty Taobao, the efficiency of search, and the optimization around goods; after the transformation of the mobile terminal, Taobao's territory expanded rapidly, including "Tmall Global" for overseas shopping, "Tmall Sale" for low-end goods, and "Taobao Xinxuan" for pursuing quality.

But back in 2024, whether it is self-developed tools, or products acquired and merged in the past, as Taobao and Tmall continue to expand the ecosystem, these countless products, after experiencing internal horse racing, strategic iteration, and organizational adjustment, not only failed to become a new growth curve, but made Taobao's plate increasingly bloated, followed by a sharp increase in the number of employees, how to effectively manage and be forced to raise KPIs.

The old and new rules are in dilapse, and the problems facing the giant ship have become more complex.

The Hidden Worries of the Golden Age

Relying on the no-service fee strategy to make eBay lose out of the Chinese market is one of Taobao's most classic battles. Although eBay was the world's largest e-commerce trade website at that time, Taobao, under the leadership of Jack Ma, was obviously more familiar with the Chinese market.

Taobao in the PC era has built a complete ecosystem, with a market share of more than 90% at one time. It not only provides buyers and sellers with a trading platform, but also covers payment, logistics, credit evaluation, marketing promotion, data analysis and other service support, compared with the early successive decline of eBay, Dangdang and other players, Taobao one-stop novel consumer experience, fundamentally got rid of the shackles of third parties, which was very scarce in that era.

According to Ma Yun's vision, the ideal Taobao is not to be an e-commerce, but to be a carrier of e-commerce: to make Taobao an open platform, absorb collaborative partners, and integrate and connect all resources such as finance and logistics. At the same time, JD.com's approach was diametrically opposed, with its supply chain, logistics, and self-operation making JD.com's start like a diesel car, heavy but slow.

Later, for the sake of capital operation, Taobao successively spun off Taobao, Tmall and Yitao, corresponding to different business models of C2C, B2C and search guides. When people speculate who will go public first between Tmall and Yitao, with the emergence of B2C malls dominated by JD.com, the demand for price comparison has been weakened through services such as quality assurance and self-operated logistics, and the rise of Taobao and Tmall's market share, Yitao has gradually deviated from the center.

The cost of customer acquisition has increased dramatically, the mobile Internet is menacing, and finally what awaits is the overall collapse of PC e-commerce.

We all know the rest of the story, the main position of e-commerce has shifted to the mobile terminal. This is a radical change, the management led by Daniel Zhang and Jiang Fan began to lead Taobao's mobile transformation, it is worth mentioning that the new Taobao still continues the old genes of the previous era: obsessed with ecology, to be large and complete, to have different functions to cover all imaginable scenarios, and the monetization engine comes from absolute control of traffic.

Therefore, at this stage, almost the entire system construction of Taobao revolves around traffic. In addition to Taobao and Tmall building a variety of products for drainage, there are also commission platforms such as Mushroom Street and Meili Shuo to drain Taobao externally, and the benefits of this are obvious, Taobao and Tmall have eaten enough market dividends. But because of this, Taobao's profit model is also increasingly reliant on traffic.

The harm caused by this inertia is like boiling a frog in warm water, which is difficult to detect in a short period of time and difficult to change for a long time. A former Ali employee commented, "Taobao's internal products are easy to achieve from 0 to 1, but it will be difficult to develop well in the future, and the final result will be directed to the main station, and it is difficult to make real differentiation." ”

After that, whether it was investing in Cainiao Logistics, founding Freshippo, acquiring Yintai, RT-Mart, or Alipay's financial services, they either provided traffic to Tmall and created performance, or blindly pursued consumption upgrades in order to pursue sufficient profits and market share. Later, under the leadership of Daniel Zhang and Jiang Fan, the Tao system continued the path dependence of the past, further bet on consumption upgrading, and from strategic policy to organizational management, huge inertia took shape.

The lonely past of the Tao short video

What many people don't know is that as early as April 2016, Daniel Zhang, then CEO of Alibaba, set community, content as the future direction of Taobao, in his opinion, younger is the inevitable trend of Taobao, to the mobile Internet era, user use time will be an important indicator to measure the value of the platform, "the platform continues to create new products, new consumer objects, consumption of content, in order to achieve real kill time." ”

Interestingly, almost at the same time, Taobao launched live channels, Taobao Toutiao, Q&A and Taobao community. Daniel Zhang sees the influencer economy as part of Taobao's "content producer development plan", and the role of the platform is to provide traffic and operational tools, set up a stage for sellers to sing, and catalyze the fan effect to form a community. At the end of the year, the Taobao short video project was established internally, only three months later than the launch of Douyin.

At that time, in addition to the short video shopping guide "Image Taobao" promoted by Taobao, there were as many as 7 short video entrances on mobile Taobao, which was the only full-link content distribution section of mobile Taobao, and the internal was also very optimistic about the potential of "short video + e-commerce":

Among them were Zihan, who was the head of Taobao's short video at the time, and Sun Bin, CEO of Tmall's content service provider Seeding. Jiang Fan, then senior director of Taobao's product platform, said that in the future, 90% of Taobao's content will be carried by video, and short video will completely change the entire consumption model. Immediately afterwards, Fan Zhen, then director of Tmall wireless content operations, spoiled in public that Taobao would make a short video app and would include more institutions and talents.

Surprisingly, however, the progress of the business has since become confusing. According to the media at the time, Fan Zhen's speech was quickly withdrawn, and there was no official response to the matter. According to the analysis of industry insiders, because there is a threshold for the commercialization traffic of the platform, once the commercialization rate exceeds 15%, it will affect the browsing experience and efficiency of the platform, and the contradictory controversy has become the trade-off and balance between content and e-commerce.

Until 2018, the short video App "Luke", which is independent of Taobao's main station, was launched in a low-key manner, when it was rumored that the product was benchmarked against Douyin, Ali public relations Wang Shuai appeared in response, "The better the short video, the better Douyin, and the richer the e-commerce." Ali only wants to provide more forms and choices for e-commerce practitioners, not benchmarking. ”

Judging from the product details of the year, Luke did not follow the interface of a single screen of Douyin, but made a category distinction at the top of the screen of the bottom menu bar "Discovery", in addition to the "Attention" and "Popular" columns, the others are "Dress up, travel, beautiful home, delicious, childlike, cute pets" involving clothing, furniture and other categories. It is understood that each video of the content creator at that time could be mounted with products from different Taobao stores, and there was a button to jump to Taobao in the lower left corner of the video, which was similar to the shopping cart button of Douyin at that time, which could go directly to Taobao's external links.

But what is incomprehensible is that compared with before the launch of Luke, Taobao's internal collective optimism about content e-commerce, when the product was really launched, it was like a grayscale test, and the official hardly had any active promotion and drainage, and most merchants did not know, and those merchants who were selected by the video did not take the initiative to participate in product promotion.

Luke's positioning is an e-commerce short video, as a vassal of Taobao, the main task is to drain traffic.

To some extent, this determines the limitations of its growth: it cannot compete with entertainment short video apps such as Douyin, and due to the nature of "short video" with advertising, it is difficult to form a fan effect and community operation. On the contrary, short video platforms such as Dou and Kuai during the same period all hoped to transfer traffic to the trading market and create a so-called closed loop of e-commerce, not just advertising, such as the cooperation between Kuaishou and Youzan at that time, and the addition of Kuaishou stores in the App.

According to the media at the time, Taobao's KPI for this app was to exceed 10 million DAUs within the year, and there was only one quarter left at that time. Judging from the results, the last version and Weibo update of Luke stayed at the end of 2018, and finally ended hastily. For making short videos, Taobao had nearly two years of layout time, but it didn't think it through and missed the best opportunity for development.

The Taobao live broadcast that doesn't grow big

In terms of live broadcasting, Taobao Live was established earlier than Taobao short video.

The first beta test was completed at the end of 2015, and the trial operation was entered at the beginning of the following year. According to Taobao's vision at the time, its ideal participants were brand merchants or merchants with a certain fan base, but according to the memories of relevant practitioners, when the product first appeared, live broadcast platforms such as Douyu and Huya based on show or game live broadcast were on fire, and Taobao live broadcast for positioning consumption was no different from traditional TV shopping in the eyes of many people.

In order to enhance people's attention, Taobao Live has invited some celebrity stars for 100 days, and at the same time, they are also looking for and supporting potential anchors and institutions to try, Wei Ya and Li Jiaqi also began to emerge at this time.

In 2017, Taobao Live and Tmall Live announced the merger, Taobao Live and the platform's Double 11 and other big promotion activities were directly linked, and within two hours of the start of Double 11 in the following year, the sales of Weiya live broadcast room reached 260 million, and the GMV of the whole live broadcast room exceeded 300 million yuan, and Taobao live broadcast brought more than 100 billion yuan in 2018, with a growth rate of 350%.

But compared with Douyin and Kuaishou at that time, the latter not only had a larger overall traffic pool, but also the recommendation mechanism of the algorithm, people began to realize that ordinary people would become popular overnight on Douyin and Kuaishou because of a short video, but there was basically no such possibility in Taobao. But Taobao Live also has its own advantages, "In fact, Taobao Live has stronger fan stickiness and a higher conversion rate, because the user's consumption purpose is clear." A former employee of Taobao Live said.

In Taobao, as long as Li Jiaqi starts broadcasting, he basically locks in the daily crown of the day, but in Douyin, even if Luo Yonghao can win the monthly crown with the super long live broadcast time, there will still be a higher GMV than him, and the daily crown of Douyin live broadcast is changing almost every day. Taobao cultivates the beautiful anchor of Dou Kuai as an e-commerce amateur, and Dou Kuai regards Taobao Live as a talent of the Whampoa Military Academy, the most typical, it is difficult for you to name the famous anchor of the Tao Department other than Wei Ya and Li Jiaqi.

The real crisis occurred in 2020, when Douyin's daily activity just exceeded 600 million, and it began to do e-commerce in person, and announced that the live broadcast room would no longer divert traffic for external platforms. Under the crisis, the "Diantao" incubated by Taobao Live was launched, and the person in charge was Cheng Daofang, who originally expanded the short video market in India.

Diantao's Slogan is "seeing the world without leaving home", and its functions include short videos and live broadcasts, with obvious purposes. However, some media reported that the person in charge of Diantao explored the major MCN institutions in the industry, but did not find a person willing to come to Taobao Live to promote newcomers. Cheng Daofang later concluded, "Taobao Live used to be more self-restricted, and it was a transaction-oriented platform. In the past, most of the content of Taobao live broadcast was centered on e-commerce live broadcast and valued GMV, but now it calls itself life live broadcast, which is actually a full-category live broadcast that attaches importance to user time. ”

As the Toutiao APP has been soaring, the things that Taobao had worried about in the past began to happen one by one. But this time, Taobao has adopted a more conservative approach, and compared with creating an independent short video app outside the site, Taobao chooses to do a closed loop of content consumption on the site to improve user stay time and conversion rate.

"Shopping" is a product of this situation.

Taobao has integrated and upgraded multiple content sections such as buyer shows, micro-Tao, and Yangtao to shopping, mainly undertaking Taobao's grass planting function. At the same time, in order to provide more public domain traffic for merchants and talents, Taobao has opened the first-level entrance of the homepage tab for shopping, and the main channel of traffic search has also opened the entrance, and even because of horse racing, it has deliberately weakened "guess what you like".

But the reality is that the number of page views is always not high, and the gameplay is still the same old way of saving points and receiving cash, and there is not much difference between Duoduo Video and various speed version applications. Until the middle of 2022, Taobao changed the distribution logic of live broadcast traffic: in the new traffic distribution mechanism, a part of the traffic of the transaction was used as content, and a part of the traffic pool was specially used to support the development of content.

But in the eyes of the outside world, these measures still treat the symptoms rather than the root cause. Taobao pursues more ecological traffic, compared with interest e-commerce through "high frequency and low frequency" to activate consumption, Taobao's content is mainly reflected in the early stage of throwing money and grabbing big anchors, but Taobao's long-term shelf e-commerce system has not changed, and the front-end investment has gradually evolved into a certain drainage mechanism, and the high cost of customer acquisition has not changed the original trading field.

The loss of Taobao is not in Pinduoduo

If you really want to define an inflection point for Taobao, 2018 may be more appropriate.

At that time, Pinduoduo, which was only three years old, had just gone public in the United States, and the soaring GMV aroused collective concern within Alibaba, but even so, Taobao's management did not seem to realize the seriousness of the problem, that is, the dividends of the times have quietly changed, and Ali was still immersed in bursting confidence at that time, and the group's core e-commerce revenue and new users hit the highest value since its listing.

In an interview, when Daniel Zhang was asked, "Will Pinduoduo pose a threat to Taobao?" he responded, "We can't go back to the road of selling a pair of daily disposable shoes and free shipping." At this time, Daniel Zhang's understanding of Pinduoduo is still stuck in low price and low quality, which he believes is not long-term, but can cultivate users and markets for Taobao.

Looking back, although Pinduoduo and Taobao relied on low-price strategies to break through in the early days, the development logic behind them was different.

Taobao and Tmall, including Tmall Global and Tmall Supermarket incubated later, as well as concepts such as "new retail and new consumption", are essentially derivatives of consumption upgrading, at least until 2018, Alibaba's consumption upgrading strategy is effective. However, in order to compete with JD.com in consumption upgrading, Ali began to change its direction - upgrading the supply chain, and also launched the "Taobao Xinxuan", which focuses on high-quality e-commerce. At the same time, in order to attract more big-name merchants, the traffic and resources of the platform are tilted again.

The final outcome is that the status of Juhuasuan, which focuses on cost performance, has been gradually weakened and reduced to simply draining traffic to Tmall.

Later, Ali's e-commerce business basically gave up the sinking market. On the one hand, Taobao Tmall is still in the stage of high growth and high profits, and there is no strong incentive to rely on subsidies to spend money to penetrate the sinking market.

Many people believe that in 2018, Ali integrated a number of cost-effective platforms, including Juhuasuan, Daily Sale, and Taobao Rush Purchase, and also launched Tmall Flash Drop and Taobao Sale, in order to counterattack Pinduoduo with a combination of punches. However, if it is placed in the context at that time, Ali hopes to give full play to its own quality advantages to recycle users in the market where Pinduoduo has completed education.

As Jiang Fan insisted: "We never believe in consumption downgrade, the needs of Chinese consumers are diversified, and we hope to help China's 1 billion consumers achieve consumption upgrades and quality shopping." "But reality has proven that this undoubtedly leaves a gap for competitors to survive.

Taking 2018 as a watershed, the official did not announce the overall GMV of Taobao's e-commerce, but the overall transaction volume of Tmall increased by 31%, and the transaction volume of Taobao increased by 19% It was not until 2019 Double 12 that Taobao officially launched a subsidy of 10 billion yuan, and Taobao's initiative to fight against Pinduoduo officially kicked off, followed by the launch of Taote App, with a wide range of money subsidy marketing, Taote's growth accelerated in a short period of time, and the number of registered users soon exceeded 100 million.

But after that, Taote's GMV and growth fell again. The reasons behind it are complex: Taote benchmarks Pinduoduo, the former and the latter look similar at the pixel level, and although Ali has invested heavily in Taote, it is also facing an internal game - "Do you want to sacrifice Tmall's high profits in order to invest in Taote?" On this point, the internal view has been wavering.

This situation is not uncommon on Taobao.

With the more frequent team changes of Taobao e-commerce, since Jiang Fan transferred to the head of Ali's overseas digital business, Dai Shan has become the new head of Taobao and Tmall, and last year was replaced by Wu Yongming, the change of management means that the operation ideas of some strategic businesses will change, from the stock of the Daniel Zhang era, to the increase in the future of the low-price strategy, and improve the priority of Taobao...... Every change that has to be made may affect the consistency of the business strategy deployment.

Under the drastic organizational changes, Ali's previous order balance was broken, and many departing employees said, "In the work, not only to withstand the pressure of innovation and growth, constantly think about new business directions, but also to be busy with reporting and upward management. ”

"Ecology means height. Daniel Zhang once explained in an interview that he believes that innovation and result orientation are not actually in conflict, and the decision-making of the management is not a problem of execution, but a problem of the top-level structure, and it is normal for problems to occur, "In the end, you see, the wrong person is selected, the team is wrong, then you must be ruthless to adjust." ”

The current Taobao is doing such a thing.