Source: See the truth
"Now the big boss of e-commerce is scolding people every day."
Why swearing?
"Because there are gaps everywhere, there is no quantity. The pressure is scary, and everyone is anxious. ”
This conversation took place during a long chat with the person in charge of the private domain of a large brand, and we used A to refer to each other for the time being. In his company's planning, May 15 will become the first day of the company's 618 sales season this year.
This is not the earliest, what he saw was that Dabo had already started in advance on May 9, "I didn't expect it to be so early". In 2023, Tmall's 618 promotion cycle will only be 28 days.
The change stems from the cancellation of the "pre-sale". Not long after the long holiday in May, Taotian Group announced the cancellation of 618 pre-sale, and Jingdong subsequently spread the news. According to the news that has been announced, Taobao Tmall will start the first round of promotions at 8 p.m. on May 20 and the second round of promotions at 8 p.m. on May 31. However, the brand rolled earlier than expected, "as soon as the platform rhythm came out, all merchants and all channels began to rush to the front". It was 5 days earlier than the first round of the platform's launch.
When the industry is discussing how to do 618 this year, there is a hint of tragedy. It seems that this point in time is a super hurdle, and whether it has passed or not, there may be many drastic changes.
01. The GMV gap is too big
Why is there so much anxiety? A said that it was still because "the GMV gap is too large".
"Now that the big boss is down in person, all sales have set hard targets, and it is not excluded that some sales middle and senior managers who cannot complete the task will be moved."
This is not the case, because as far as the eye can see, there is "hardly a good one" in the industry. This strategy makes a lot of the play in the industry this year look like:
"Before the GMV gap, nothing mattered, now it's just a random fight, and whoever wins is the hero."
How to mess around?
Another brand bluntly said that the strategy of 618 this year is that the current market state of extreme involution has led to its own compromise from pursuing high-profit products to "running volume".
There are even troubles caused by WeCom's recent big moves: WeCom's rectification of some tools and the resulting banning have made many businesses face greater obstacles when they deploy 618. In addition, many e-commerce platforms are pushing low price strategies, which further compresses the living space of brands.
It seems to have been the same last year. As soon as 618 ended last year, everyone sighed that it was "the worst 618 in history", saying that the traffic of some categories was 6 times more expensive, and 80% of merchants lost money to accompany and so on. Even, many businesses are not even embarrassed to send war reports. And, last year, all platforms focused on one:
Low price!
The basis of all problems, or the source of anxiety and stress, comes back to one thing:
How difficult will it be this year (2024)?
Just this past weekend, the real team discussed the market with a CEO, and we first referred to him as B, and he directly threw out several sets of data from his company:
In the whole year of 2023, the number of user orders in the second half of the year is significantly weaker than that in the first half of the year, and the visual inspection is more than 2%.
In the first four months of 2024, the number of orders placed by users fell by at least 3% compared with the same period last year. The best month was worse than the worst month in the second half of last year.
In the first four months of last year, the monthly data was higher than the previous month's data. In the first four months of this year, the monthly data was lower than the previous month, and the past April was especially bad.
This is the order quantity. The data in this dimension is the most stable in the past. If you switch to a different dimension, it is even worse.
For example, the average order value. At this time, it is only half of what it was in 2021.
For example, the total income can only be compared to the end of 2021-early 2022.
The industry in which B is located is actually a rich circle, and it stands to reason that it is currently the most stable market, and the per capita customer order can easily be in the range of 10,000-20,000 yuan. Now it's down as well.
Let's just assert that maybe B and his company aren't working hard enough.
What about other industries?
In another article about the tea industry published not long ago, an executive (codenamed C at the time) had an in-depth conversation, and there was a refinement:
The platform traffic is still there, and users don't place orders anymore. The big anchors are still there, and the amount of energy they can bring is collapsing. The stream is still there, and the budget can't be spent. The natural flow is still there, and the transformation has fallen by 6-7%.
C told us that he used to be able to sell 4 million in a single month on Douyin, but now he can only sell 1 million. In 2020, the sales could reach 300 million, and this year, the sales in the first four months are estimated to only reach 100 million, which is 30% of 2020.
And that refinement, which industry we talk to these days, which industry we say, is really right, too empathetic.
The essence of this year's indiscriminate fight during 618 is that businesses hope to find a source of new increments and regain growth. And the anxiety at this time has made this year's 618 big sales node dyed with a touch of tragedy.
02. What should I do in 2024?
What if you don't meet your goals for the year? So what will be done?
Or layoffs. A large company told Jianshi that it had laid off a number of employees by the end of the year, and many of the positions that were once standard in-house were now outsourced. But if the 618 does not meet expectations, it may continue to be cut in July:
"Unless the employees who do a good job can relax, they may be fired the next day."
Another told that the other party had reduced its number of employees from more than 300 to more than 70 at the end of last year, and it was unlikely to do so at the moment. The market budget has also been retained, but the platform can no longer be consumed as in the past - not only will the company lose money if it is lower than a certain ROI number, but also even if users click on the ad, the proportion of order conversion has also decreased sharply, just watch and not buy, which makes some industries and merchants begin to look at the market conservatively and cautiously.
In any case, in recent years, the growth strategies that have emerged have been linked to the pressures in these big sales milestones. Just like the private domain, it is the rising customer acquisition costs from 2017 to 2018 that have opened a new growth trend for some sellers.
In the past few days, Jianshi talked to 618 with teams in many different fields, and they made it clear that they didn't care anymore, "they won't pay for streaming", but they should care about the user behavior habits of their own industry:
When the merchants in the industry invariably start a certain growth method, it will form a business cluster effect, which will bring unexpected results.
The market pressure of 618 in 2023 has made some teams in the tea industry begin to vigorously invest in advertising, directing users directly to the private domain and then converting sales, and these advertisements have now swept Baidu and Tencent Video Accounts.
Last year, 2023, 618 was an important point in time. In recent years, the ROI of many brands has been difficult to correct at the major nodes of 618 and Double 11 e-commerce, so they have been constantly exploring new ways to play, and have begun to become the focus of some teams before the Spring Festival.
When the market is extremely difficult, directing users directly to the private domain and then transacting has become the focus of many teams.
Especially in the industry chain to occupy the source and price advantage.
Along with the news of the cancellation of the pre-sale, there is also a rumor circulating in the industry:
It is said that an e-commerce group wants to cancel the distinction between its two major platforms and accelerate the unification into one. On the premise of organizational unification that has been promoted for many years, we will go one step further. It is said that the relevant plan has already been completed, just waiting for the founder to make a decision.
In the past, it was split because of consumption upgrades. Now it is clearly a big era of consumption downgrade, and a new giant has run out, and at the beginning of the year, a certain Douyin also began to publicly send a message to merchants, asking for the lowest price on the whole network. This reunited platform will be directly unrolled at a low price.
This rumor has made some brands realize that from 2024 onwards, the public domain will change dramatically.
B said: "A lot of brands will collapse. Because their cost of sales and gross profit have been stretched to the limit, they will either break through the limit directly, or they will just lie flat and give up."
For example, he said, there is even an international beauty brand, and the headquarters has directly decided to abandon the trading KPIs in the Chinese market within three years and focus on brand value.
Interestingly, A's company is a local FMCG brand, which is the same as one of the changes mentioned by A during the discussion: "In the instructions given by the big boss, the CMO should make every effort to restore and enhance the brand value". This seems to mean that if the 618 can't roll anymore, then the price will not be rolled at all.
Either lie flat, or lay off staff and reduce allocation. At the same time, we are looking for new ways to grow that adapt to the market.
03. Can the private domain be detached?
Will the private domain transcend such involution?
A admits that they are less stressed at the moment. First, because the private domain does not yet have an absolute say in front of the income of large groups, it "accounts for a relatively small amount". The second is that their private domain performance continues to grow, which makes the big boss very satisfied.
But the pressure on the private sector depends on the company.
For example, in 2023, Jianshi had a conversation with the person in charge of the private domain of a brand team, and the other party told Jianshi that the private domain department was the company's second-level department, "grandpa doesn't hurt, grandma doesn't love", but it shines during the epidemic, especially in 2022. Because it helped the company to keep track of its basic income, the traditional e-commerce department often came to ask for help because of the ROI that collapsed during the Double 11, 618 and other big promotions, so the position became more and more important and became a first-level department.
But another apparel-related brand's private domain team was not so lucky. When the executives of the e-commerce department found the big boss, they said lightly: The private domain has affected our sales. The big boss had to reluctantly kill the entire private domain team - in the next few days, the private domain director of the team will come out to look for a job.
Among the topics shrouded in the entire private domain circle, "exchange cooperation, activation of silent users, group leader/distribution", etc., suddenly became the hottest proportion, except for the fight because of the big ban of tools, other topics can rarely be compared in the period before 618, because these are closely related to transformation.
Another change is also happening - the private domain boss of a clothing brand received a "discussion" from the boss during a long vacation, and she needs to consider integrating the private domain and public domain departments, and unify user operations to make a "global growth" department.
For this reason, the brand, together with Team A, is already discussing with each other how to improve the topic of global development.
There are several major brands with similar changes, and simply put, the private domain is not unimportant, but more important, and it is time for users of different platforms to be managed and operated together.
A brand team even started to precipitate users to Gewei again - this practice is abnormal at the moment, because Gewei does not have applicable tools and systems, and cannot support the operation of a large number of users.
But can it be supported by others? It doesn't seem to be either.,There's been too much trouble about the ban recently.,There's no support from tools and systems.,It's all manual.,Is there any difference between different WeChats?
For them, although Gewei cannot support the operation of users in batches, the ultra-high customer unit price can support the cost of hand-holding and heavy operation of employees, and Gewei can quickly establish and gain user trust, which has unparalleled advantages in this regard. No matter how well you use content and IP, you can make the conversion better than others.
When discussing with B, he speculated:
The trend in the next few years is to make the reference price in the public domain and the lowest price in the private domain.
The public domain contributes 7% of the turnover, 30% of the gross profit level, and 10% of the net profit level. The private domain contributes 3% of the turnover, and the gross profit is 20%, but the net profit level can be 15%.
B believes that this is determined by the difference between the relationship between the brand and the user. He's the CEO, and he's already looking at and thinking about such fine details.
This speculation is actually very likely, and it is closely related to what many companies are doing right now: whether it is rising to "global domain" or turning power users back to micro, it is to serve users more seriously.
In this way, the emphasis on private domains, the requirements for operation, and the re-selection and application of tools will be new topics for everyone to discuss next.
This year's 618 is a little difficult, but I don't know what new opportunities will be opened.