What kind of profound changes in the e-commerce industry are reflected behind the dynamic of the pre-sale mechanism from the introduction to the abandonment? This article specifically analyzes the reasons for the cancellation of pre-sales by major e-commerce platforms, and recommends that those who are interested in the e-commerce industry read and learn.
618 is coming, and this year, there is a new change in the e-commerce industry - major e-commerce platforms have announced the cancellation of pre-sales. Platforms such as Taobao Tmall, JD.com, and Kuaishou have all joined the ranks of this change, and other platforms will soon follow.
From the earliest introduction of the pre-sale mechanism in Taotian, which has become a tried and tested strategy in previous major promotions, to now being abandoned, but in more than ten years, this reflects the profound changes in the e-commerce industry.
Why did the major platforms launch pre-sales in the first place? What kind of vitality has the pre-sale model injected into the e-commerce promotion? And now, why do you choose to give up this former "magic weapon"? This article will talk about these issues.
01 Why did Taotian open pre-sale?
Around 2010, Taotian was in full swing, and the GMV of the platform continued to rise during the big promotion, creating a number of sales miracles in the e-commerce industry. However, with the surge in order volumes, the platform is facing significant inventory management and logistical pressures.
In 2012, in order to meet this challenge, Taotian introduced a pre-sale model for the first time. This initiative not only solves many problems in the actual operation of the platform, but also brings multiple benefits.
1. Inventory management
The pre-sale model is essentially a C2M business model, which allows merchants to rationalize production and inventory according to the consumer's deposit payment. This model gives merchants more time to prepare their goods, thus avoiding the problem of delayed shipments caused by excessive sales during previous big sales periods.
Through pre-sales, merchants can more accurately predict market demand, reduce the risk of excess inventory, and at the same time, alleviate logistics pressure to a certain extent, ensuring that consumers have a smoother shopping experience during the promotion period.
2. Movement of funds
The pre-sale mechanism also provides merchants with the opportunity to withdraw funds in advance. Before the big promotion, the deposit paid by the consumer gave the merchant a glimpse of its possible future income.
With this revenue possibility, businesses have the confidence to use the same amount of money for raw material procurement, production expansion, or marketing, thus gaining an advantageous position in a highly competitive market. In addition, the funds to be withdrawn also reduce the financial risk of merchants during the promotion period.
3. Market testing
Pre-sales also serve as an important role for market testing. Merchants can evaluate the market acceptance of products through pre-sales, so that they can adjust their marketing strategies in a timely manner.
If a brand releases a new product during a big sale, merchants can judge whether the product is popular based on the pre-sale, and if the response is enthusiastic, they can increase production to meet market demand; If the market response is mediocre, you can adjust the product features or marketing strategy in time to make product improvements.
This method not only helps merchants reduce the uncertainty of marketing, but also makes resource allocation more efficient and accurate.
4. Promote consumption
Taotian was the first to launch the pre-sale mechanism, which is essentially to improve the consumer experience, increase the attractiveness of the platform, and promote GMV.
The pre-sale + final payment method makes use of the Zeganic effect to deepen their memory of the event. The Zeegarnik effect, also known as the Zeegarnik effect, refers to the fact that people are more likely to remember unfinished or interrupted things than they have already done.
To sum it up in one sentence: if you don't forget, there will be an echo.
The consumer first paid the deposit at the time of pre-sale, but he had to wait at least a week before paying the final payment, in this week, he always thought about it in his heart, and would go to see the goods for which he paid the deposit every day, which virtually increased the traffic of the platform and the possibility of buying other goods. This mood was only relieved after he paid the balance a week later.
Because consumers paid a deposit at the time of pre-sale, their attention and memory to the platform increased by a week, which allowed the platform to increase traffic and more sales possibilities.
02 Why have all platforms canceled pre-sales?
In 2024, the competitive landscape in the e-commerce field has undergone earth-shaking changes, and platforms such as Taotian (Taobao Tmall), JD.com, Pinduoduo, Douyin, and Kuaishou have launched various innovative marketing strategies and service models in order to compete for market share.
Pinduoduo, in particular, has quickly won the favor of the market with its low-price strategy and consumer-friendly policies such as "refund only", and its successful experience has been followed by other e-commerce platforms.
These changes have forced all platforms to re-examine their business models and service strategies, realizing that in this competition, winning consumer trust and satisfaction is more critical than simply attracting merchants.
With the accumulation of more and more negative effects due to complex rules and long delivery times, major platforms have decided to cancel pre-sales and return to a simple and direct sales model to improve consumer experience and enhance the competitiveness of the platform.
The cancellation of pre-sale is more beneficial than disadvantageous today, and the following are the reasons for considering the cancellation of pre-sale by the platform.
1. Simplify the shopping process
The complexity of pre-sale rules often confuses consumers, and in order to get a little discount, consumers have to spend a lot of time and effort to understand the rules, which greatly weakens the pleasure of shopping. Cancel the pre-sale, so that shopping is simple and straightforward, more in line with the needs of the moment.
At the same time, in the pre-sale model, consumers often have to wait a long time to receive the goods, which is contrary to the fast and convenient service characteristics of the e-commerce industry.
After consumers buy goods, they naturally want to receive them as soon as possible, and a long wait can make people feel tormented. By canceling the pre-sale, consumers can get the goods faster, which is undoubtedly more in line with the current consumer demand for instant gratification.
2. Avoid price dissatisfaction
Price is one of the factors that consumers pay the most attention to during the big sale.
During the pre-sale period, consumers often need to pay a deposit in advance, but sometimes they will find that on the day of 618, the price of the product is lower than that of the pre-sale, which will undoubtedly make consumers feel that they have "bought at a loss".
Even if the price of the pre-sale and the big sale are the same, since the pre-sale items need to wait until the end of the event to ship, consumers will feel that they have paid in advance but do not enjoy the convenience of receiving the goods in advance, and this experience gap will also affect their satisfaction with the platform.
Canceling pre-sales can avoid these problems caused by price and time differences, and make consumers feel that they can enjoy a fairer and more transparent shopping environment during the promotion period.
3. Reduce returns and refunds
After the first wave of pre-sales in previous years, "refund" will always be on the hot search, and many people find that they don't need what they chopped at that time after a few days of thinking.
"Refund" is on the hot search, which is the embodiment of "buyer's remorse". In the context of a big sale, we are always prompted to buy some goods, which you think will bring you a new change, but many times, the result is that you regret the impulsive purchase of the product.
This kind of regret after impulsive purchases, coupled with the cumbersome return process, seriously affects the shopping experience of consumers.
After canceling the pre-sale, consumers can make more rational purchase decisions, reduce impulse purchases, reduce return rates and refund disputes, and improve shopping satisfaction.
4. Adapt to normalized low-price competition
In the current e-commerce competition pattern, Pinduoduo's tens of billions of subsidies, Douyin and Kuaishou's live streaming and other models have turned the once big promotion and low price into a norm. This normalized low-price competition has weakened the appeal of traditional promotions, and consumers no longer have the same high expectations for discounts during the promotions.
The e-commerce industry has also entered the era of stock competition, and the competition between platforms pays more attention to price advantages. Canceling pre-sales and selling directly at low prices has become an inevitable choice for e-commerce platforms to survive and develop in the involution competition.
5. Consumption downgraded, and pre-sales can no longer drive sales
In the context of consumption downgrade, consumers' purchase willingness and purchasing power have declined.
In the past, pre-sale, as a means of promotion, could effectively stimulate consumers' desire to buy, but nowadays, consumers have become more rational and cautious, and are less sensitive to pre-sales, which require a deposit in advance. Consumers are more inclined to make purchases based on actual demand rather than being driven by promotions.
The pre-sale mechanism can not effectively drive incremental sales, and it is easy to cause consumer dissatisfaction and complaints, so there is no need for this mechanism to exist.
03 Conclusion
Pre-sale, as a promotional method launched by e-commerce platforms in a specific period, has only existed for more than ten years since it was first introduced by Taobao and Tmall in 2012.
Initially, the pre-sale mechanism brought a series of benefits to e-commerce platforms: it helped merchants lock in sales in advance, effectively manage inventory, recoup funds in advance, and optimize product strategies through market testing. These advantages once made pre-sales an indispensable part of the e-commerce promotion period.
However, with the continuous changes in the consumer environment and the increasing competition of e-commerce, the pre-sale mechanism has gradually exposed a series of problems. Complex rules, long wait times, a high percentage of returns and refunds, and consumer dissatisfaction with pre-sale prices are all eating away at the consumer shopping experience.
As the e-commerce industry enters the era of stock competition, low-price strategies and instant gratification have become new consumer trends, and the attractiveness and competitiveness of pre-sales are declining.
In this case, the pre-sale mechanism cannot bring the expected sales increment to the platform, but has been criticized by consumers because of various drawbacks, bringing negative effects, so its historical mission has come to an end.
Columnist
Xunkong, WeChat public account: xunkong2005, everyone is a product manager columnist, business observer, social marketing explorer.
This article was originally published by Everyone is a Product Manager and is prohibited from reprinting without permission.
The title image is from Unsplash and is licensed under CC0.
The views in this article only represent the author's own, everyone is a product manager, and the platform only provides information storage space services.