Imagine that a merchant with sales of 10 million yuan has an average price of 200 yuan per item, but the return rate is as high as 40%. This means that they could lose up to $300,000 in just one return. The chain costs of logistics, warehousing, and repackaging hidden behind the returns have made this number climb to one million per month. This is undoubtedly a huge erosion of merchants' profits and makes them feel pressured.
The return rate of the e-commerce industry is becoming increasingly prominent, and it will become a topic of great concern in the e-commerce industry in 2024, and it has also become a sword of Damocles hanging over the hearts of merchants, threatening their interests at all times. Fang Jianhua, the founder of the Inman brand, bluntly revealed the pain points of this industry in a public occasion - the return rate is as high as 60%, and even soars to 80% in some categories, and the high numbers have frightened countless merchants.
Jin Xiaohua is one of them, and the return rate of her small household appliance brand has continued to rise in recent years, which makes her feel anxious.
"Every time a new product comes out, I'm scared." Jin Xiaohua said frankly that returning goods not only means the loss of funds, but also worries him about the damage to the brand image. She tried a variety of ways to reduce her return rate, but none of them worked as well as she could have liked.
At the suggestion of a friend, Dewu entered Jin Xiaohua's sight. She decided to try to settle the product into Dewu, hoping to use this platform to reduce the return rate and stabilize sales.
In fact, there are not a few merchants like Jin Xiaohua. More and more merchants are starting to pay attention to Dewu as an important channel to reduce return rates and win certainty growth.
Taking the head daily chemical brand Blue Moon as an example, the sales performance on the Dewu platform is particularly bright, with a growth rate of more than 100% at the beginning of 2024, and what is even more rare is that it also maintains a very low return rate in Dewu.
Blue Moon is not alone. In Dewu, the return rate of sportswear, children's clothing, and women's clothing remained at less than 15%, far lower than the industry average. However, in the field of clothing, it usually faces a high return rate due to differences in size and style, as can be seen from the recent revelation that the return rate of a women's clothing brand is as high as 80%.
Why do merchants achieve a return rate that is far lower than the industry average? What are the good opportunities for merchants? Ebang Power chatted with merchants operating different categories in Dewu, trying to explore new business opportunities from the issue of return rate.
01
Survey on the return rate of Dewu merchants:
Clothing is less than 15%, trendy toys are less than 3%
"In Dewu, our return rate has been maintained at an average of less than 5%, which is not only the high standards and requirements of the brand for products, but also through the multiple strict reviews of product quality, the joint efforts of the brand and the platform, so that consumers have a high degree of recognition of our brand." The person in charge of the C coffee brand said to Ebang Power.
With its innovative design and affordable price, Ccafe's skin care products have won the love of many consumers. The extremely low return rate ensures that C coffee can continue to grow benignly on the Dewu platform.
Not only beauty, but also a merchant who has been engaged in trendy toy brands for more than 10 years told Ebang Power: "Users of Dewu have a very high acceptance of our trendy toy products, and their willingness to return them will be relatively low, up to less than 3%. ”
The return rate of badminton brand Kawasaki Zaidewu is about 3%, which is much lower than the average return rate of the industry and the return rate of other mainstream e-commerce channels.
Whether it is C coffee or Kawasaki, the low return rate is a feature that coincides with the user characteristics of Dewu. The data shows that the penetration rate of post-95 users on Dewu has reached more than 70%, which is the youngest of all platforms, and they have a strong willingness to consume, and have a natural love and curiosity for trendy sports, trendy toys and beauty, which greatly reduces its after-sales rate at the product level.
A jewelry brand merchant revealed to Ebang Power that the average return rate of jewelry products on the Dewu platform does not exceed 10%, which is particularly conspicuous in the industry. Previously, the gold jewelry industry had revealed that some merchants had a return rate of up to 90%.
Coincidentally, in the field of non-standard products such as children's clothing and sportswear, the return rate of the Dewu platform also remains at a low level in the industry. For example, the return rate of sportswear is less than 15%.
"The low return rate brings real net profits," a merchant told Ebang Power.
Low return rate means efficient inventory management, stable capital return, and can effectively reduce the cost of logistics, packaging materials, and damage to goods. In addition, the courier fee, packaging fee, and interception of express delivery required for delivery add up to nearly 5 yuan, which are also wasted.
Under the assessment mechanism of some platforms, a high return rate will also bring about an increase in hidden operating costs, such as some platforms will count returns in the assessment score of the store, and the return rate will be high, and the free traffic that can be allocated by the subsequent platform will be reduced accordingly.
In addition, the high return rate brings not only the occupation of merchants' funds, but also the investment of manpower and the loss of goods. Frequent shipments and returns require more manpower support; Round-trip express delivery and buyer unpacking will cause a lot of damage, which adds up to invisibly pushing up operating costs.
Taking a fashion shoe brand as an example, it told Ebang Power that it sold 120 million yuan of goods on other platforms, which was about the same as 80 million yuan in sales of Dewu because of the return rate and operating costs.
02
Behind the low return rate:
Dewu's insight into young consumer demand
After studying the low return rate of Dewu, it was found that this number is only a result, and the reason for this is that the platform itself has a different business idea.
"The matching mechanism of people and goods on the Dewu platform is not pan-traffic, nor is it impulsive consumption. It is to make each item accurately meet the real needs of consumers, which greatly reduces the possibility of returns. The owner of a distributor who acts as an agent for a skin care brand told Ebang Power that his return rate is only 1%, "The operation model of Dewu is completely different from that of traditional e-commerce platforms, paying more attention to the goods themselves, and there is no excessive marketing stimulation, and the entire order conversion process is more 'natural'." ”
Based on such insights, many merchants will focus more on researching the real consumption of young people on the Dewu platform. By accurately grasping the needs of young consumers, merchants have carefully adjusted their pallets and operation plans in order to start a high-speed growth model on the Dewu platform.
Xidesheng settled in Dewu in July 2023, and in less than a month, the average daily GMV increased by 20 times. "The growth rate of Zaidewu far exceeds that of other e-commerce platforms."
"If the Dewu platform finds products with explosive potential, it will give us more resources to push," said the director of Xidesheng e-commerce, and they were pleasantly surprised. "A very interesting set of data is that the silent order rate of Dewu is very high, accounting for 70-80%, customers rarely come to consult, and many directly place orders" - as long as the merchant ponders the preferences of this group of users, there is no need to burn money to invest in the stream, and there is no need to repeatedly compress profits, and there will be good business if you focus on the goods.
Badminton brand Kawasaki, its popular Aurora 7 series, is designed according to the real needs of young people, from the rapid explosion of Dewu to spread to all channels. Kawasaki's distributor, Guangzhou Jiandao, recalled that when he found that many badminton racket products on the market were old-fashioned and did not meet the aesthetics of young people, he specially created a product with high appearance and simple design for the young female market, adding elements of laser and light, and proposed design ideas to the brand. The Aurora 7 sold out as soon as it was launched, and Kawasaki also relied on this to increase its Q1 performance in 2024 by 2.6 times compared with the whole year of 2023.
The true feelings of young people contain real needs, and many businesses invariably talk about the outbreak node of Dewu more in the courtesy scene, and consumers who buy things for interest and like things with a sense of ceremony. "This scenario is unlikely to change with the changes in the promotion of e-commerce platforms. Gift needs are needed by almost everyone, birthdays, Valentine's Day, New Year's Day, Christmas, these holidays or special commemorative days, there will be gift purchase needs. At the same time, you can see the daily updated list of opportunity products on the platform in the background of Dewu merchants, and merchants can find opportunity products according to this list, which can effectively improve the probability of business outbreak. ”
In addition to real consumption, Dewu's model provides dealers with a simplified operating environment that allows them to focus on the listing and bidding of goods to achieve efficient product circulation.
In terms of things, both the presentation of goods and the operation activities are very simple. All products are displayed in the form of white background maps, and there are no overly delicate high-definition model pictures taken well, and there are no bells and whistles full reduction and order making up mechanisms, "which inhibits users' impulsive consumption to a certain extent." A merchant told Ebang Power, "Consumers who get things are relatively rational in shopping. ”
"There is no need to operate in Dewu, and the platform does not need to do a lot of tedious work, just put the existing goods on the shelves and bid on them." Zhao Lu (pseudonym), a merchant who represents big-name beauty, has a team of only 2 people to operate on Dewu, and the team does not need to invest a lot of energy in tedious operations such as store operation, product detail page production and shelf mapping, and does not need to face complex e-commerce rules. The customer service and operational support provided by the Dewu platform greatly reduces the operating costs of merchants, enabling Zhao Lu to focus on the selection and sales of goods.
"The people who get things belong to high-net-worth users and are willing to pay for their favorite products with high unit prices. The advantage of our entry is that the goods brought by us are scarce and there is demand from users. Where there is demand, there is a purchase, which returns to the essence of business. The platform provides a trading place for buyers and sellers, mainly in the matching of demand and goods. Zhao Lu said. In the first week of settling in Dewu, Zhao Lu only launched three high-priced products such as Helena black bandage, achieving a GMV of nearly 300,000. This is not only a successful test of the waters, but also a proof of accurate grasp of the market.
In the next holiday node, Zhao Lu showed amazing explosiveness. During the Christmas period in 2023, they will focus on gift boxes of makeup items such as YSL small gold bars and Givenchy red velvet, achieving a GMV of more than 170,000. On Valentine's Day 2024, they will increase the number of items to 55, and the GMV will exceed 4 million in one fell swoop.
For channel merchants with a source of goods, and even merchants who are new to e-commerce, the Dewu model shows great friendliness.
Finally, the significant difference between the Dewu model and other platform models is its strict merchant access standards, high quality and high customer orders, which are especially critical for merchants who pursue quality. It has also allowed many businesses to see the high-quality user groups of Dewu.
Dozens of days of quality standards not only block some of the products that are not hard enough in advance, but also allow consumers to establish trust in the platform, so as to maintain a low after-sales rate in the follow-up consumers.
Acting as an agent for Dyson, Philips, and Xiaomi, e-commerce companies were just holding the mentality of trying it when they first settled in Dewu, but soon found that this platform can not only sell goods, but also sell good goods. Duan Cunlei, the person in charge of e-commerce, said to Ebang Power: "In Dewu, our products can better show quality and value, and reach more high-quality users. ”
Yin Fan of Wuhan Pincheng Weichuang Trading Co., Ltd., a merchant of children's clothing. It has operated on multiple e-commerce channels, but the return rate of Dewu has always been stable at a low level. He told Ebang Power that the current stability is about 8%. Yin Fan believes that "Dewu has a good user base and Dewu's strict control of the quality of goods, so that the return rate will naturally decrease." ”
03
What are the other business opportunities?
In Shen Qiu's view, doing business in Dewu is the logic of doing goods. The wider the pallet, the more merchandise flows. This is more friendly to merchants who have their own sources of goods and supply chain advantages. "Because more goods means more traffic, and every commodity is a consumer entrance."
As the competition of e-commerce enters the white heat, and the return and refund rate of other platforms is rising, low operating costs, fast payment collection, and low return rate have become a unique advantage, and have increasingly become the most concerned points for merchants to do business. What is commendable is that at the current stage, the demand for things is still far greater than the supply, and it is in the platform dividend period.
As an e-commerce platform with the largest number of young people, Ebang Power believes that for a long time in the future, Dewu will always build its own business barriers around the needs of young people.
The subdivided industries that young people like: the proportion of post-90s users has reached 90%, and the post-95 users are more than 70%, and the development of products around the real needs of young people, like a track representing young people's outdoor sports, will be a very potential direction. For example, Purui, a cutting-edge badminton brand, has developed candy-colored badminton rackets around young users, which suddenly meets the needs of female users.
Segments related to young people's lives: The first batch of young users on Dewu have now entered the working, starting a family and even childbearing age, and their needs are also further expanding, whether it is beauty and personal care, digital home appliances or baby industry, they are very likely to make a big business.
Segmentation of young people's emotions: Today's young users pay attention to both cats and dogs, and are extremely willing to pay for the things they love, some IP derivatives, cultural and creative peripherals and gift products, such as gold jewelry, bird's nest, and health care products for parents, have unexpected sales in Dewu.
Ebang Power understands that Dewu will invest huge traffic resources in 2024, implement a zero-threshold merchant entry policy, and provide personalized support to attract more kinds of goods and diversified merchants. For new merchants, Dewu has launched a 30-day commission-free period and a zero-margin entry policy, and at the same time, through new business training camps and full-process guidance and other services, to help them get off to a rapid start.
In addition, Dewu will also create sales peaks for merchants through holiday marketing activities aimed at the new generation. For new products, Dewu has also formulated a special support plan, including targeted support for high-quality traffic, commission-free policies for new product sales, and differentiated marketing and content operation strategies, aiming to help potential new products quickly emerge.
Merchants who are interested in Dewu can fill in the form, sign up for consultation, and get more platform bonus information.