Ignition dimension (id: chaintruth) original
Produced by Burning Finance
Author | Yan Junwen
Edit | Lin Wenlong
Recently, a number of merchants revealed to Burning Finance that the repurchase rate of Douyin e-commerce is growing rapidly. In the eyes of these merchants, this is more exciting news than conversion rate increases.
The conversion rate reflects the marketing effect, and the increase in this number means that the cost of pulling new products is reduced, "New products or new brands often pay more attention to the conversion rate, because of the lack of loyal old users." Zhou Nan, who has sold high-end liquor on Douyin for nearly two years, told Burning Finance, "Behind the repurchase rate are repeat customers, that is, loyal fans." We look specifically at repeat purchase rates. ”
It is understood that the repurchase rate is also the most important evaluation index in the retail industry, and the higher the repurchase rate of the brand, the stronger the competitiveness.
Now, Zhou Nan has more and more repeat customers, "there are more than 2,000 old customers, basically every month will buy wine with us." We don't have to put in advertising, we can do 20 or 30 million a year. "Many times, Zhou Nan's live broadcast room has only a few hundred fans, but the spending power is very strong, thousands of per capita, and the final turnover is also very good."
Behind the increase in the repurchase rate is actually the positive feedback of trust and quality service. "We provide our customers with better products and services and enhance their shopping experience. Customers therefore trust us more and are willing to buy more products. In Zhou Nan's view, this is a virtuous circle.
As we all know, the improvement of the shopping experience requires the platform and the merchant to work together. Recently, Douyin e-commerce launched the consumer rights product "Safe Purchase", and launched 9 services such as "Genuine Product Protection", "Seven-Day No Reason Return", "Fast Refund", "Freight Insurance" and "Door-to-Door Pickup", so that users can feel at ease in every aspect of shopping.
The relevant person in charge of Douyin e-commerce said, "Only when after-sales is no longer difficult, users can buy with peace of mind." The launch of the 9 major after-sales rights and interests means that the platform will put the risk in the forefront and provide users with multiple guarantees from the system. Our original intention is to let all users place orders with confidence. The person in charge introduced that in the future, Douyin e-commerce will effectively solve user pain points while fully safeguarding the rights and interests of consumers, and continue to make efforts to upgrade the user shopping experience.
Zhou Nan welcomed the practice of Douyin e-commerce, saying that the concept of customer-centric, service first, etc., is the core value of the brand, "let consumers buy at ease, this is the common interest of the platform and the merchant, we, as a merchant, will definitely strongly support." ”
Burning Finance has learned that as the shopping experience gets better and better, more and more consumers are becoming deep users of Douyin e-commerce, and Zhang Huahua is one of them. "I was originally a deep user of Douyin, brushed up on good things, and Bought them by hand, which is particularly convenient." Zhang Huahua said that shopping on Douyin, the experience is very good, the product quality is good, there are after-sales problems, and it is also very convenient to return and exchange goods. "My relatives and friends around me all buy things on Douyin, and everyone often shares the good goods they brush with each other."
Zhao Meng, an industry insider, said that from the perspective of the development strategy of Douyin e-commerce, whether it is attaching importance to high-quality supply chains, introducing experience points, or continuously helping brands and merchants, but also continuously improving the requirements for goods and services, these mean that Douyin e-commerce will rely on and quality services as a new cornerstone for platform development. “
As we all know, e-commerce is an old battlefield, and there are many experiences of success and failure. In Zhao Meng's view, Douyin e-commerce, as a rising star, from a strategic point of view, walking on a very correct path, but if you want to run up and quickly reach the goal, you still need to solve many tactical problems, for example, the maintenance of trust may be more difficult than the establishment. This is also the reason why Douyin e-commerce is particularly careful in platform governance.
Some people don't know that most of our needs on "eating, drinking and having fun" can be met on TikTok. On Douyin, in addition to food beauty recommendations and anecdotes, Douyin's e-commerce business also meets the needs of users to buy beauty, clothing, electronic products, etc.
The "2021 Douyin E-commerce Ecological Development Report" shows that in the Douyin e-commerce user group, women are the main group of purchases, and men have grown faster in the past six months. From the perspective of age distribution, young users after 80 and 90 occupy an absolute advantage, and the growth rate after 95 is the highest. In the first-tier, new first-tier and fourth-tier cities, both head-on and lead user growth, of which Shanghai, Chongqing and Beijing have also become the three most shopping-loving cities in 2020.
Like Zhang Huahua, Ma Dan, a native of Xi'an, Shaanxi Province, born in 1996, is also a deep user of Douyin and Douyin e-commerce. At present, her consumption on Douyin adds up to 20,000 yuan.
Ma Dan started by brushing vibrato, and later filmed videos to publish, and now, he also helps his car company shoot and edit videos and post them on his account to test the effect.
Martin shops on Douyin, mainly in toys, daily chemicals and clothing. Toys for the little nephew to buy, makeup and clothes for himself to buy. She described the shopping experience on Douyin as buying, buying and buying, and placing an order to buy when you see what you like and are interested in, which is very convenient.
"At the beginning, I also had doubts, will I buy fake and shoddy products? Will there be returns and exchanges and other after-sales service problems? It turned out later that there was none. Martin said.
Zhang Huahua daily purchase is more fresh and makeup, before, will encounter fresh rot deterioration, beauty products after use of allergies and other issues, "these two types of goods after the sale of the problem is difficult to solve, the general platform, I dare not buy." Zhang Huahua said that now she can buy it with confidence on Douyin. It is understood that under the protection of the "safe purchase" of Douyin e-commerce, for rotten fresh goods and beauty products with allergy symptoms after use, users can contact the merchant within 24 hours and 60 days after signing, and can enjoy corresponding compensation after passing the review. Up to now, the "Fresh and Bad Single Package" and "Beauty Allergy Package Refund" have served more than 180,000 people.
After the launch of "Safe Purchase", the relevant person in charge of Douyin e-commerce shared a typical case: a user purchased a brand of skin care products on the platform and had allergy symptoms after signing for 29 days. The merchant has opened a "beauty allergy package refund" service. After the user uploads the picture to prove the evidence, the merchant passes the return application within 3 minutes, and the user successfully receives a full refund of 1490 yuan after returning the goods.
A good shopping experience has made Zhang Huahua and Ma Dan a typical portrait user of Douyin consumption, that is, they love fashion, love dress, love trends, and like textured lifestyles. Recently, Ma Dan bought a garbage can on Douyin, which is different from the simple garbage can sold in the market or supermarket, when placing an order, the merchant also specifically asked her, you can choose "Happy Sheep", "Crayon Xiaoxin" and other stickers on the garbage can to increase the beauty of life.
The daily chemical products launched on Douyin have distinct content attributes, and in addition to practical functions, most of them have some content tags. For example, in addition to the cutting function, scissors can also clip walnuts and screws; ordinary bubble machines and self-hi pots have become essential for men and women to fall in love. This makes buying things on Douyin become scene consumption, functional consumption.
"Friends around you also recommend each other, and everyone shares it as part of their daily social life." Martin said, "Of course, there is a quality guarantee that we will recommend to friends. ”
The influx of a large number of users, especially the increasing number of young users who "love to share", "user reputation" is the key to the benign and healthy development of this ecology, the quality of goods, after-sales service, etc. are more important, and platform governance has become the top priority of operation. The launch of "safe shopping" is a major measure of platform governance, which can solve the actual problems of users in the shopping process and make the platform develop more long-term and benign.
The high return rate has always been a pain point in the live e-commerce industry. According to statistics, the comprehensive return rate of the e-commerce industry is about 10%, but the return rate of the live e-commerce industry is much higher than this figure. Relevant surveys show that the return rate of live e-commerce can reach 30%, of which only 27% of users say that they rarely return or cancel orders.
Zhu Fang is the head of a clothing manufacturer in Guangdong, she began to enter the live broadcast with goods in June 2020, according to her calculations, the live e-commerce return rate, 20% is a red line, if more than 20%, the entire cost curve will rise sharply, 15% and the following is the best.
Many people blame the excessive return rate of live e-commerce on impulse consumption and poor product quality. In Zhu Fang's view, the return rate brought about by impulse consumption is not a big problem, "Basically within one or two hours of placing a single, the impulse subsides, and then applies for a refund, at this time, we generally have not shipped." "What is more troublesome is the return rate caused by the quality of the goods.
Zhu Fang said that in the past, taking offline wholesale, dealers begged for more goods, took a batch of two or three thousand pieces, if there was a problem, there would be hundreds of returns, but they were all in batches, and their work was not so cumbersome; but the live broadcast of goods directly to consumers was different, and had to set up 24-hour after-sales, and had to arrange logistics, busy for hundreds of returns.
Most of the problems of return and replacement are due to problems with the quality of goods, and this can be solved to a large extent through platform governance, for example, the platform can greatly reduce the quality of goods by improving the standards of after-sales service. Zhu Fang said that the higher the after-sales service standard, which means that the higher the cost of selling goods with quality problems, "the problem products sold will basically be returned, and the gain is not worth the loss." ”
After-sales service will force supply chain reform, requiring merchants to make the same quality of goods to a lower price, or the same price of goods to achieve higher quality, which in turn can enhance the competitiveness of goods. A merchant in Yiwu told Burning Finance, "The goods on Douyin can currently be made of high quality and low price. Because of the large number of sales, especially the explosive model can generate hundreds of thousands of orders at a time, large-scale production can significantly reduce costs, which allows many merchants to reach exclusive cooperation agreements with manufacturers."
A number of merchants told Burning Finance that in live e-commerce, people often regard people and goods (supply chain) as the most core elements, but in the transaction link, trust and quality service are the most important factors. In other words, the pain point of live streaming is effective platform governance, not others. Douyin e-commerce has made great efforts in this regard.
Kang Zeyu, president of Douyin E-commerce, once said very clearly, "Only high gmv is not Douyin e-commerce, and it is Douyin e-commerce that can provide good prices." It is understood that the first thing Kang Zeyu did after being responsible for Douyin e-commerce was to raise platform governance to the highest priority. Douyin e-commerce has mobilized a large number of products, technologies and operational backbones to join the governance team and comprehensively strengthen the governance and control of merchants and commodities to create a benign business environment.
Burning Finance has learned that in recent years, as more and more consumers are accustomed to shopping on Douyin, more and more merchants have also begun to pour into Douyin e-commerce.
In March 2020, Ziyuan, a major flower planting and sales household in Dounan, Kunming, began to live stream goods on Douyin. In the past, their markets were mainly oriented to the Pearl River Delta, the Yangtze River Delta and Southeast Asia, but due to the impact of the epidemic, they began to carry out live streaming on Douyin. As of December 2020, the cumulative sales on the Douyin platform exceeded 5 million.
On August 9, Douyin E-commerce released relevant data on the platform during the Tokyo Olympic Games. According to the data, from July 21 to August 8, the sales of Douyin e-commerce sporting goods increased by 365% year-on-year, and Hongxing Erke became the most sought after sports brand, and guijin bird, Li Ning and Anta, which are also domestic products, also ranked among the top five.
For example, in 2021, Douyin e-commerce joined the 618 e-commerce promotion for the first time, and the number of live broadcast rooms (including 100 million) exceeded 150 in a single session. For example, by January 2021, the transaction volume of the Douyin e-commerce platform has increased by more than 50 times compared with January 2020.
E-commerce is an old battlefield, with many players and many ways to play. Most of the e-commerce platforms that have grown up in the past have a stage of barbaric growth, mainly through low-price strategies to gather users and enhance the visibility of the platform. Wait for the platform to be large enough, and then deal with problems such as fake goods and poor service.
In June 2020, Douyin E-commerce officially became a first-level business department of ByteDance, and in July, it began to recruit soldiers. In April 2021, Douyin E-commerce launched "Interest E-commerce". That is to say, Douyin e-commerce is a proper new platform, but in Zhao Meng's view, from the perspective of development strategy, Douyin e-commerce has directly crossed the stage of barbaric growth, emphasizing from the beginning that consumers can "buy with peace of mind", "This practice is not so much to build itself into a platform, but to build itself into a brand." ”
As early as 2019, Li Rongxin, CEO of Zhengshan Food, mentioned a concept that to do Douyin e-commerce, it is necessary to switch from the perspective of ROI (return on investment) to the perspective of gpm (gpv generated by thousands of plays). The repurchase rate is the key indicator of gpm. This also means that Douyin e-commerce will pay more attention to the rights and interests of consumers.
Some Douyin anchors with goods also found that compared with other platforms, consumers have much more evaluation dimensions of Douyin anchors, including the score of the Douyin store that the anchor cooperates with, the consumer complaint rate of the goods with goods, and the return rate. A yunnan flower merchant said that Douyin is also more strict in opening stores.
Zhou Nan said that many of the practices of Douyin e-commerce are the same as the ideas of merchants doing branding, "We are easy to understand, it is easy to accept, and naturally it will be strongly supported." "Because, for platforms and merchants, having more people shopping is a win-win situation."
Want to make more shopping behavior happen, just do a good job of platform governance is not enough, Douyin e-commerce obviously means this problem very early, since last year, Douyin e-commerce in addition to self-built small stores, but also the introduction of Suning, Jingdong and other partners, strengthen the supply chain end, at the same time, Luo Yonghao introduced Douyin live broadcast, to create the head anchor IP, and quickly out of the circle; in addition, also developed Douyin payment, Dou staging and other transaction means, accelerate the improvement of e-commerce infrastructure.
The relevant staff of Luo Yonghao's "Make a Friend" live broadcast company told Burning Finance that they often interact with the Douyin e-commerce official, "Douyin is making the granularity of e-commerce fine and dense. "The refined operation has won it a good reputation, and there are many repeat customers." On Douyin e-commerce, platforms, merchants, and consumers benefit from each other and become a community of interests. In the eyes of Zhou Nan and other merchants, the development of Douyin e-commerce has become unstoppable, because Douyin e-commerce has been doing win-win things and has also gained countless loyal fans.
Resources
"Depth 丨 What is the gpm that Zhang Yiming is concerned about? Source: Kath Academy
*Captions and some of the accompanying images are from Visual China. In the text, Zhou Nan, Zhang Huahua, Zhao Meng, Ma Dan, and Zhu Fang are pseudonyms.
*Disclaimer: In no event shall the information herein or the opinions expressed herein constitute investment advice to any person.