Source: Huashang Taoluo (ID: hstl8888) Author: Huashang Taoluo
The byte system has given birth to an independent APP.
A month ago, Xiaomi, Huawei, OPPO and other app stores added an APP called "Douyin Mall", does this mean that Douyin e-commerce, which has been developed for four years, will "fly solo" and is holding back new moves?
01
"Interest e-commerce" is in place
2020 is definitely a strong stroke in the history of Douyin e-commerce.
At the beginning of this year, the epidemic trapped people across the country at home, and the outbreak of online consumption accelerated.
At the critical moment when the people of the whole country were concentrating on epidemic prevention and anti-epidemic, Luo Yonghao, who was burdened with a debt of 600 million, received a signing invitation of 60 million from Douyin and embarked on the road of "debt repayment" with live broadcasts.
With the influence accumulated over the years, Luo Yonghao's "Make a Friend" live broadcast room, the first show handed over the report card of "more than 48 million views and more than 110 million GMV", and later created the myth of "bringing goods for more than two years and paying off 600 million debts".
Luo Yonghao not only became popular with himself, but also brought fire to the "live broadcast with goods", and Douyin took this opportunity to tear a hole in the e-commerce pattern dominated by traditional shelf e-commerce, and even redefined the e-commerce pattern.
"LatePost" once reported that the GMV of Douyin e-commerce in 2020 exceeded 500 billion yuan, more than tripling compared with 2019.
At that time, it was also rumored that ByteDance gave Douyin e-commerce a GMV target of 1200-150 billion yuan at the beginning of the year, but due to too strong growth, the target was raised to 250 billion yuan, but the final performance continued to double on this basis.
By 2021, some media have disclosed that under the wide caliber of Douyin e-commerce, GMV has approached one trillion. In fiscal year 2021, Taotian's GMV has reached 7.5 trillion yuan, while Taobao's live GMV has just exceeded 500 billion.
In other words, Douyin Live first took one year to catch up with Taobao Live, which had been developing for four years, and then doubled and surpassed in one year.
Its performance soared due to objective environmental factors at the time, but it also relied on its unique ecology and model - in April 2021, at the first Douyin E-commerce Ecological Conference, Kang Zeyu, President of Douyin E-commerce, proposed "interest e-commerce".
The underlying logic of this model is to stimulate users' interest in the product through content such as short videos or live broadcasts, which in turn stimulates shopping demand.
For example, if a user suddenly swipes a short video/live broadcast about children's educational toys, he may be inspired to realize that his child also needs such a toy, and then complete an unplanned consumption in advance.
In this way, the potential shopping demand is stimulated, and the whole shopping process is quite smooth.
The great change lies in the fact that it subverts the traditional logic of "people looking for goods" and "finding people through goods".
Traditional e-commerce uses search as the entrance, if users do not actively search, consumers will not be able to see no matter how good the merchant category is, so brands often need to spend a lot of money on advertising, and the cost of customer acquisition is constantly pushed up.
Interest e-commerce allows merchants to reach consumers through content, coupled with Douyin's daily active traffic pool of 600 million at that time, the algorithm that accurately identifies the potential needs of users and makes personalized recommendations undoubtedly gives merchants a new way to break this dilemma.
Compared with the graphic detail pages of traditional e-commerce, short videos, live broadcasts and other methods can also bring users a more immersive experience, thereby increasing the conversion rate. According to the research of Zhongtai Securities, in the form of pictures and texts, the average conversion rate of a single user is about 0.5%, while the short video is 1.5%, and the live broadcast can reach a maximum of 4.3%. Behind this is the embodiment of the power of interest e-commerce.
It is not only popular with merchants, but also pleasing to users, so Douyin e-commerce has taken off rapidly, but this path also has its limitations.
02
From global interest e-commerce to independent APP
With the continuous expansion of scale, the limitations of interest e-commerce have also begun to appear.
On the one hand, there is limited capacity and presentation of content and interests.
Douyin has never lacked explosive products, but behind the explosive models, there are countless other products hidden.
Because Douyin's algorithm mechanism decides: when countless products are invested in the traffic pool, the algorithm must select the one or several that users are most willing to see and give it the traffic, and correspondingly, other products will lose the opportunity to be shown to more people.
In addition, a video corresponds to a product, and a live broadcast room can only put a limited number of products on the shelves in a limited time, which makes the SKU that merchants can show to users is quite limited, which restricts the development of the brand.
On the other hand, most of the people who consume on Douyin are pan fans who cannot be retained and converted again for a long time.
People who brush Douyin mainly focus on a pastime, and only occasionally brush up on the goods they are interested in, they will impulsively place an order, and often leave after buying, not to mention the repurchase that merchants particularly value.
CTR research shows that the repurchase rate of users on Douyin is significantly lower than that of traditional e-commerce platforms, and more repurchase behaviors occur off-site. That is to say, after the user buys it once on Douyin, if it is used well, it will return to Taobao next time.
I spent the money hard, but I made a wedding dress for others, and the merchant had long been crying and fainting in the toilet, but the user walked mercilessly.
Douyin has also gradually realized that the shortcomings of interest e-commerce are precisely the strengths of shelf e-commerce.
So in May 2022, Douyin added two words before interest: global domain.
Upgrading from interest e-commerce to global interest e-commerce, the core purpose is to break the barrier between the content scene and the shelf scene of live broadcast and short video and the shelf scene such as search, store, and mall.
After that, those categories that are missing in short videos and live broadcast scenes, as well as products that have not yet been covered in the price band under this category, can appear on the shelves of Douyin Mall! Since then, Douyin e-commerce has also launched the "search" function in the mall, and set a small goal of "shelf e-commerce will account for more than 50% in the future".
In September 2023, Wei Wenwen, president of Douyin e-commerce, revealed that the overall GMV growth rate of Douyin e-commerce has reached 80% in the past year, of which the GMV of shelf scenarios has increased by more than 140%.
Everything seems to be improving, but there are bigger contradictions to be solved in addition to e-commerce.
The first is the question of how to balance the content and commerce of the platform.
Content is the core and foundation of the short video platform, and all commercialization is based on it.
Some people in the industry have estimated that the approximate distribution principle of Douyin's traffic pool is that 60% will be given to content and 40% will be given to commercialization. Therefore, even if Douyin is engaged in shelf e-commerce, and the brand is so arrogant that it spends a lot of money to buy traffic, Douyin also insists on the foundation of "content is king".
In 2022, Douyin found through multiple tests that when the display of e-commerce content exceeds 8%, users will leave Douyin, so it took the initiative to reduce the overall traffic ratio of e-commerce, and also gave birth to a big IP: Dongfang Selection.
At that time, Dongfang Selection had just adjusted from the original simple selling of goods to the live broadcast mode of selling goods while lecturing, that is, more content and less goods, and as a result, the average stay time in the live broadcast room soared from 57 seconds to 3 minutes 07 seconds, and the average stay time of the entire Douyin e-commerce live broadcast room at that time was 49 seconds.
In this way, Dongfang Selection not only obtained traffic, but also was considered high-quality content by the platform because of its good retention data, and additionally obtained the distribution of content traffic pools.
But Dongfang Selection is an example after all. Most merchants are still in an embarrassment: on the one hand, Douyin spares no effort to develop shelf e-commerce, linking resources and providing advertising services for them; But on the other hand, it has drawn a high red line in commercialization......
Either it is complained by merchants or dissatisfied by users, so Douyin is in a dilemma of how to balance content and commerce.
Secondly, the certainty business that merchants want cannot be given by Douyin.
Traditional e-commerce comes with its own shopping attributes, and users open Taobao, Jingdong, and Pinduoduo to shop. Based on the user's browsing habits, the platform is divided into different channels and categories, and traffic is distributed, and merchants choose the platform with the appropriate tonality according to the products they operate, when the two match, users will be retained, and the brand will also have the opportunity to do private domain to improve the repurchase rate.
In other words, the shopping genes of traditional shelf e-commerce give merchants greater certainty and security.
And Douyin, which focuses on entertainment, lacks this certainty. Everyone comes to see the content, shopping is still a matter of the way, if you are interested, you will buy, if you are not interested, you will not buy, which is weaker than everyone who enters Taobao to shop.
At the same time, as a super APP that carries content, e-commerce and has a GMV of 2 trillion, the operation experience of Douyin e-commerce within the large platform has also been restricted. At one time, some users complained: the entrance of Douyin APP e-commerce-related functions is becoming more and more complicated and secret, and it is also very difficult to return and exchange goods.
In the era of e-commerce entering stock competition, Douyin e-commerce needs to find a better solution if it wants to achieve the goal of 50% of shelf e-commerce.
In addition to collaborating with each other, it seems to be a way to let content and e-commerce go their own way and perform their own duties, and most of the "Douyin Mall" that has been launched is running for this.
But in the field of e-commerce, especially for users who have installed many apps, is there still room for an independent e-commerce APP?
03
How to break through?
Leaving the Douyin mall under the shelter of the main Douyin station, there will inevitably be constant challenges.
First of all, it will face direct competition from the "Big Three" of Alibaba, Pinduoduo and JD.com.
According to Xinmao.com's calculations, in 2023, the order volume of Pinduoduo and Ali will be 110 million and 100 million respectively, and the GMV will be 4 trillion and 7.2 trillion respectively.
The results of Douyin e-commerce are also quite good, but it depends on the traffic of the main Douyin station. If Douyin Mall wants to continue to "snowball" with an independent APP, it must cross at least three thresholds first.
The first hurdle is the user's mind.
Nowadays, Tmall, Taobao, Jingdong, and Pinduoduo all have their own loyal users, as well as users' perceptions of each other.
This kind of cognition and mentality, Taobao and Jingdong took 10 years, or even more than 20 years to build, and Douyin e-commerce, which has been soaring for four years, has implanted what kind of mind into users?
When people mention Douyin, they will think it's fun, the little brother is cool and handsome, the little sister is beautiful, and shopping is more of a random event.
In other words, Douyin e-commerce does not have a clear mental model in the minds of users, nor does it have the certainty of looking for what to buy, so when it becomes an independent e-commerce APP, why do users choose it?
What's more, there is no shortage of shopping apps in everyone's mobile phones.
The second hurdle is commodity power and price power.
The "cat and dog PDD", which has been deeply cultivated for many years, has a huge first-mover advantage in the richness of goods and the number of SKUs.
In addition to the lack of commodity power, the price power of Douyin e-commerce is also under great pressure.
Wind data shows that on November 30, 2023, Pinduoduo surpassed Alibaba with a market value of $195.887 billion (market value of $190.703 billion at the time), once again showing the world the lethality of low prices. The "tens of billions of subsidies" "rolled" up by Pinduoduo are also popular on various e-commerce platforms, and low prices have become the main theme of the entire industry in the past year and today.
Behind the low price, it is the right to speak between the brand and the e-commerce platform, and this is the shortcoming of Douyin e-commerce.
Although many live broadcast rooms on Douyin are full of "9.9 yuan free shipping" products, looking at the entire Douyin shelf e-commerce, the price is not dominant.
According to a report by "LatePost" in March this year, the price difference between the same model of Douyin e-commerce and Pinduoduo for many standard products was once as high as 50%.
Commodity power and price power are the key to victory, and Douyin e-commerce may not be able to take advantage of Ali in this key.
The third hurdle is the supply chain.
The endgame of e-commerce competition will return to the ability to fulfill, that is, the competition of logistics and supply chain capabilities.
JD.com has its own logistics, Ali has a rookie network, they rely on their own technology, upstream and downstream resources to firmly grasp the right to speak in the supply chain in their own hands, and provide more high-quality services, such as half-day delivery, next-day delivery, door-to-door delivery, etc.
Douyin e-commerce has also been frantically making up classes in the past two years, successively accessing three links and one reach, post, SF Express, and JD.com, trying to make up for its own shortcomings with the help of external logistics capabilities.
It's just that the current industry is fiercely fighting, and relying solely on external capabilities is probably not enough.
These three thresholds are more difficult than the other, how will Douyin Mall deal with it?
From the current point of view, the way of playing the Douyin Mall APP seems to be, on the one hand, learning from Ali's strengths, and even paying tribute to Ali with plagiarism, and on the other hand, trying to improve Douyin's longboard to establish its own advantages.
Judging from the settings at the bottom of the Douyin Mall APP, it is very similar to the logic of Taobao, including "home", "video", "shopping cart", "message" and "me"; Taobao includes "home", "video", "message", "shopping cart" and "my Taobao", the only difference is that "shopping cart" and "message" have swapped places.
It can be seen from the homepage interface that Douyin e-commerce has also adopted the most eye-catching low-price strategy.
In the APP, "Newcomer Exclusive Subsidy" is placed in the banner position, and the words "low-price seckill" in the recommendation position below are also particularly conspicuous.
At the same time, since the beginning of this year, Douyin e-commerce has made a lot of efforts in commodity power and price power, such as the establishment of commodity centers, attention to small and medium-sized businesses, and the introduction of white-label merchants. This year, Douyin e-commerce has officially announced that "price power" is the highest priority task in 2024.
It seems that low prices are going to be the main direction of attack by Douyin Mall.
While making up for shortcomings through these, the Douyin Mall APP also tries to use its core advantage - content to attract traffic.
Although the shooting and creation function has been eliminated, the Douyin Mall APP retains the video interface. Users can swipe videos, watch live broadcasts, and shop in the live broadcast room on the app. In other words, it wants to do better content within the framework of "business".
But there is a fact that cannot be ignored: although the Douyin Mall APP has shown strong shopping attributes and provides a convenient shopping experience, almost all of its functions can be found on the main Douyin site.
So why do users want to go to the next Douyin mall APP?
Resources:
[1] "Douyin E-commerce, Launched Its Own "Taobao" Clone" Connected Insight
[2] "A Crisis Prevention of Douyin E-commerce" New Berry Daybreak
[3] "Shelf E-commerce Won't Die, Interest E-commerce Hasn't Won Yet" TopKlout Crowley
[4] "Why does Douyin want to do interest e-commerce? Li Chengdong
[5] "Douyin Independent Mall App Launched: Mobile Internet Ushers in the Last White-Knuckle Battle" Zinc Finance
[The author of this article is Huashang Taoluo, and the entrepreneur is authorized to reprint.] If you need to reprint, please contact the WeChat public account (ID: hstl8888) for authorization. ］