"The apparel business is an innovation lab within Taobao and one of the pathfinders for China's apparel industry."
Looking at the development of Chinese consumption, you can look at Taobao; to see the development of Taobao, you need to look at clothing. Taobao clothing is a mirror image of observing the changes in China's clothing consumption, if you focus on this, you can observe that some explicit or implicit changes are rapidly occurring, converging and fermenting.
At the end of this year's Taobao Spring New Forces Week, 36Kr interviewed Qiao Qiao, who is not only the head of Taobao's fashion lifestyle industry, but also a "veteran" who has been immersed in Taobao clothing for more than ten years. This is Jojo's first interview with the media. To a certain extent, combing out the growth context and thinking behind Taobao clothing is to observe the evolution of Taobao and the window of the development of China's clothing industry.
Qiao Qiao, head of Taobao fashion life
What does Taobao apparel business mean for Alibaba? The outside world has its own interpretation. But in the eyes of Qiao Qiao, head of Taobao's fashion and lifestyle industry, "the apparel business is an innovation laboratory within Taobao, and it is also one of the pathfinders of China's apparel industry."
Whether it is e-commerce live broadcasting or support policies for new merchants, Taobao apparel business is the earliest testing ground, even if it is one of the largest industries in Taobao. Once these new products and standards are in place in the apparel business, they will be rapidly rolled out to other consumer businesses.
The standards and systems set up by taobao clothing such as iFashion have also guided the e-commerce market of clothing to a large extent, and then transmitted to the upstream and downstream industrial chains. Compared with the giant domination of the European and American apparel industry, the pattern of "decentralization" of the domestic apparel industry is obvious, thus forming a market characteristic of new and fast, high frequency and diversified styles, the most critical representative of which is the merchant group on Taobao clothing, and even the market of Hanfu, JK and other main circle cultures has been bred.
In June last year, the Taobao apparel industry launched the "Taobao Has New Coffee" project, focusing on supporting young entrepreneurs with excellent content creation capabilities, many of whom are young people born in 1998 and 1999. In this project, Taobao has planned a number of support policies such as cash red envelopes, traffic subsidies, special marketing resources, and platform guidance. In the past 7 months alone, nearly 40% of the new merchants in the project have reached a transaction size of more than one million, and most of them are "novices" who started from scratch.
"Last year it was just Taobao clothing that was done, and this year it has been expanded to the whole Taobao industry," Qiao Qiao told 36Kr. In Taobao's internal planning, this project will incubate 100,000 influential new merchants in the next three years.
The special status of the apparel business is related to its current volume and its position in the development of Taobao. Among the basic needs of human food, clothing, shelter and transportation, the online penetration rate of "clothing" far exceeds that of other categories. On Taobao, it has taken the lead in forming a trillion-level market, high penetration, high loyalty and super market scale so that the apparel business naturally has the potential to become an innovation experimental field; at the same time, clothing is not only the starting business of Taobao, but also established a complete industrial chain and ecology, this similar "Taobao eldest son" status has laid the foundation for its continuous emergence of innovation.
In the interview, Qiao Qiao mentioned an interesting data, medium and high frequency users will buy an average of 25 to 30 clothes per year on Taobao, and the frequency of repurchase is far more than offline physical channels. The reasons for this are complex, ranging from faster frequencies to newer and more convenient buying patterns, to other factors such as any niche consumer demand being met. But in summary, its core advantage is that it is closer to Chinese consumers.
Consumers are the starting point forever
From the birth of the earliest batch of Taobao brands, Qiao Qiao has divided the evolution of Taobao clothing into 4 stages from the dimension of operation, that is, to solve the initial period of allowing consumers to "see what you get"; the iFashion period of consciously creating a "personalized style"; the deepening period of "content-based e-commerce" represented by "red people"; and the "self-operation" period of these two years, merchants interact with consumers with the help of live broadcasts, micro-Tao, group chats and other products and guide repurchase. Of course, these four stages are not isolated, and there are both inheritance relationships and intersections in the middle. For example, iFashion incubated different styles of clothing merchants in the early stage, so that they enjoyed the dividends of development. At the same time, many of them have also become the earliest "crab eaters" in the follow-up Taobao clothing to promote content, which has triggered more clothing merchants to follow up the content operation.
Specifically, the first phase appeared around 2008, solving the problem of "what you see is what you get" and allowing consumers to "dare" to buy clothes online. At that time, among the mixed clothing merchants, the Taobao clothing industry focused on guiding the merchants to take photos of the clothes worn on the body, so that consumers could see it on the computer and be consistent with the express delivery.
2015 is the second phase, focusing on encouraging clothing merchants to be original and form their own style. At that time, Taobao officially launched "iFashion", in line with the unique style, clear on the new rhythm and other standards of Taobao clothing merchants, the store's product detail page will appear in the label. The emergence of iFashion marks that Taobao clothing consciously incubates new merchants, thereby providing consumers with diversified, differentiated and life-oriented supply.
The key word around 2016 is "red man", and it is also the starting line for Taobao clothing to really develop "content". Celebrities with their own unique personalities and styles, with their own aesthetics and outfits, attract fans on platforms such as Weibo, realize commercialization on Taobao, and continue to guide fans to form repurchases through the content operation of Taobao stores. Taobao Apparel discovered this phenomenon and focused on creating benchmarking cases, improving product systems and operational incentive schemes to encourage more merchants to adopt content-based operation methods. At this stage, the clothing is no longer displayed on the shelves coldly, which also completes the rise of Taobao live broadcast and short video.
A corner of the office area of Taobao apparel industry
The fourth stage is that around 2018, Taobao clothing began to emphasize "self-operation of merchants", in the private domain with a clear "concern" relationship such as micro-Tao, live broadcast, group chat, etc., merchants take different content and forms to interact with consumers and pull repurchases, completing the self-circulation. "Through the private domain operation in recent years, we have found that from the effect of fan repurchase to promote the sales of new products, the whole increment has a very large and obvious change," Qiao Qiao commented.
In the sequential evolution of these four stages, the starting point is a certain pain point of the consumer. You will also find a clue to the change of online consumption of Chinese apparel, that is, from the merchant-centered shelf e-commerce to the consumer-centric content e-commerce - initially, Taobao clothing only played the role of the trading market, and the goods themselves were only passively displayed on the shelves waiting for users to choose; but now, Taobao is more like an "urban complex" with shopping, entertainment and other functions. Even if consumers do not buy goods, they can feel the pleasure of "shopping" from content consumption.
At the same time, in these four stages of development, Taobao clothing has formed its own ecology in solving various problems. This ecology includes merchants, consumers, service providers, supply chains, and also appears Tao girls, celebrities, anchors with goods, and ecological roles that specialize in providing services such as photo shooting and video production for stores.
In Qiao Qiao's view, from the earliest advocacy of real shooting, Taobao clothing is to do "content e-commerce", "the premise of content e-commerce is still e-commerce itself, different content is to serve e-commerce, content has become a virtual and multi-form shopping guide." ”
Qiao Qiao believes that merchants are running a business on Taobao, and the business needs new customers and old customers. Through the public domain traffic of Taobao such as thousands of people and searches, merchants can obtain new customers; the content gives merchants the opportunity to serve old customers through private domain operations, and constantly guide them to complete repurchases, thus forming a positive cycle. At present, 50% of the sales of iFashion merchants come from fan repurchases.
In fact, Taobao Clothing is also trying to benefit more small and medium-sized entrepreneurs with this e-commerce service capability. For example, in the "Taobao has new coffee" project, many of the supported merchants are circle KOLs, original designers or niche cultural store owners, who have the ability to understand changes in the consumer market, meet content consumption needs and please fans, but lack practical experience in e-commerce operation before starting a business. Through Taobao's various support policies, these young entrepreneurs can quickly understand people's actual shopping needs and expand into a seemingly small market segment.
Young people bring a new atmosphere
There is a story of a brother and sister who started a business together that impressed Jojo: they loved photography and wanted to inherit their father's craft of making clothing, so they opened a store on Taobao that focused on making JK. A new dress sold more than 300,000 pieces in a short period of time. Behind this number, in fact, the cultural circle of young consumers is forming. Young people dare to wear, are willing to pay for personality, and pay for identity.
In recent years, the internet has circulated the term "three pits", which refers to three originally niche but rapidly rising clothing styles: Hanfu, JK, and lolita. The reason why it is called the three pits is because consumers can easily "enter the pit" once they buy. It is worth noting that Taobao clothing is also one of the promoters of Sankeng culture, because it is the first platform to discover these subdivisions and operate in depth. To this day, you can even see on Taobao that more branches have emerged under the "three pits", such as "locomotive Hanfu" and "sports Hanfu" have received a lot of attention and sales results here.
The sudden explosion of "three pits" is a new atmosphere brought by young consumers to the apparel industry. Jojo observed that young people show the trend of "de-branding", no longer stuck to brand endorsement, and more concerned about whether the clothes themselves are good enough. This certainly doesn't mean brands aren't important, but it's indisputable that the factors influencing consumers' purchasing decisions are becoming increasingly diverse and personalized.
From the changes in the men's wear market, you can also clearly see the changes brought by young consumers. "A few years ago, I even thought how could the market for men be so hard to do? No matter how good it is done and how stylish it is, it is difficult to sell if it is a little more expensive," Jojo complained. But the situation in the past two years has reversed, and young men have begun to obviously pursue style and fashion culture, which makes the men's clothing market become vibrant - for two consecutive years, the growth rate of this market segment has far exceeded the overall level of the entire Taobao clothing business, and also provided new momentum for the sustained and rapid growth of the Taobao clothing industry.
More and more young people are gathering here because Taobao has also come up with young merchants. Young people understand young people better, and these new merchants have innate advantages in aesthetics, tone and marketing promotion. The data shows that the average age of new merchants in Taobao clothing has dropped by 3.3 years in 3 years, and the number of new merchants after 00 has increased by 3.5 times.
Taobao has new merchants in the new coffee project
"Now, the merchant must first be responsible for aesthetics, and then the operation and fan retention. On the back end, we will help in the methodology and supply chain development of products", Jojo believes that the threshold for young merchants to start a business has been significantly reduced. On Taobao, merchants and consumers are not simply buying and selling relationships: merchants provide consumers with goods, and they can also harvest "same good" with resonance; and consumers are also paying for the recognition of the spiritual level such as attitude and aesthetics while buying goods.
At present, the proportion of Taobao clothing consumers after 95 is increasing, but the needs of young consumers have not been fully satisfied. Taking "Three Pits" as an example, the main contradiction of this market segment is that the demand is very strong but the production capacity is seriously insufficient, which will obviously lead to changes in the front-end industrial chain and promote the emergence of more Three Pits clothing merchants and brands.
In China, the world's largest single consumer market, any re-segmentation of demand implies huge business potential. This becomes an opportunity for young Taobao clothing merchants to grasp, they do not need to become giants, they only need to take root in the segments they are really interested in to grow rapidly.
What exactly is Taobao position?
The arrival of "consumer is king" is reflected in the business model of the apparel industry is the change from B2C to C2B2C. Strictly speaking, the B2C model is a product of the era of industrialized large-scale production, through standardized operating processes to produce standardized products in large quantities to reduce the pressure on research and development, inventory, logistics and other operational links. However, this set of models is difficult to sustain in the current Chinese apparel consumer market.
On this subject, Jojo explains it from the perspective of a new rhythm in clothing. She mentioned that in most offline channels, basically on a quarterly basis, some brands can only do two seasons a year. Overseas fast fashion brands have been able to rise rapidly in the Chinese market for more than a decade, also benefiting from their rapid response capabilities throughout the entire industry chain.
However, at present, on online platforms such as Taobao, the frequency of new products can be greatly shortened to weekly or even shorter time, and consumers can be sure to see and buy new products in the first time. In the past Taobao Spring New Forces Week, more than 100,000 new products were launched. This invisibly increases the repurchase rate of customers, so that the entire market expands outward at a faster rate, and the key force supporting this new rhythm on high frequency is still the consumer.
"Many apparel brands, including fast fashion brands, are inherently B2C; but Taobao is the opposite, it can be C2B, and it can also make a virtuous circle at both ends through the C2B2C process," Qiao Qiao said.
For merchants, Taobao is not only a business platform, but also a "thermometer": before the new product is on the shelves, the merchant predicts the sales of the new model in advance through the content planting grass and interactive feedback with fans, and can also accurately supply through the rapid response supply chain. This not only alleviates the "inventory" problem that plagues the apparel industry, but also allows merchants to upgrade their products in a short period of time. In this process, relying on the entrepreneurial environment closer to consumers, China's local apparel merchants can tap a large number of opportunities in the segmentation field, even if they are small.
iFashion fashion show scene
For local apparel companies, China's complete apparel supply chain has also greatly reduced their entrepreneurial threshold. Whether it is from the perspective of cost control or perfection, the quality of the local industrial chain in China is at the forefront of the world. For small and medium-sized entrepreneurs on Taobao, this is also an advantage that can be leveraged.
Taobao clothing also sees this, and now they not only provide help for merchants in the early stage of content operation and final sales, but also begin to cover the ability to cover the more upstream industrial chain, and systematically output solutions to entrepreneurs by forming a complete ecosystem, including the "rhino intelligent manufacturing" launched by Ali last year.
Jojo recounts a case study, "There was a designer who graduated from St. Martin's School of Design who was reluctant to go to a big company as an assistant designer and wanted to share his design with more people. He came to Taobao to open his own store, which may not be very high in sales, but he has a lot of sales of millions of dollars a year, because the clothes he designs have a lot of fans of his own. Thanks to the above systematic advantages, entrepreneurs like this designer, even if they design a niche style, have the opportunity to become a business in Taobao clothing.