On September 23, 36Kr successfully held the "Wise2020x E-commerce Industry New Ecology Summit" in Hangzhou, the capital of China's e-commerce, which invited Taobao, bai Capital, Gemmet, Zi hi pot, NetEase Yanxuan, Magic Chopsticks Technology, Mushroom Street, Ruhan, Douyin, Yintai, Yunji, Leyan Technology, Guangyun Technology, Shicui Secre, Shark Fit, Zhuang Technology, Pro-Baby, Only Two, Loho Glasses and other enterprises and investment institutions to bring you a big discussion on e-commerce development and innovation.
Founded in 2015, Magic Chopsticks Technology has developed rapidly in recent years, and has received strategic investment from many well-known enterprises and institutions such as Kuaishou, Tencent, and Vipshop, and embedded a series of services of live e-commerce into the ecology of Kuaishou and Tencent.
As an s2b2c company, Magic Chopsticks initially provided SaaS tools for e-commerce transactions for Kuaishou's anchor Internet celebrities, and later the business gradually extended to the supply chain, opening up both ends of the Internet celebrities and supply chains. In recent years, on the basis of the continuous improvement of daily and monthly active short video apps and the continuous extension of user use time, live e-commerce has achieved rapid development.
According to the forecast of research institutions, the scale of live e-commerce can reach more than 960 billion yuan in 2020 and reach the level of 1.8 trillion yuan next year; it will account for 4% of the total online retail sales in 2019 and 15% in 2021. From the perspective of the industry as a whole, magic chopsticks are sitting on a fast-moving train.
From the perspective of business model, as a service platform for the live e-commerce ecosystem, Magic Chopsticks integrates relatively scattered upstream suppliers on the one hand, and integrates The Internet celebrity groups with live streaming sales capabilities on the other hand, and provides them with Store Saas trading tools, supply chains and operational services for Magic Chopsticks to help them complete high-quality commodity sales in live broadcasts. In this link, Magic Chopsticks also provides a variety of training services to improve the activity planning and operation capabilities of Internet celebrities. Relying on this, magic chopsticks have not only achieved anchors and suppliers, but also achieved themselves.
At the Wise2020 E-commerce Industry New Ecology Summit, Xue Yuanhao, vice president of Magic Chopsticks Technology, introduced the specific business actions of Magic Chopsticks in the field of live e-commerce and his thoughts on the ecology of live e-commerce.
Xue Yuanhao: Hello everyone! Thank you to 36Kr for inviting us to the summit to share what we are doing in the field of live e-commerce and our thinking about the industry.
Today's sharing is mainly divided into three aspects, the first is to talk about who the magic chopsticks are, the second is our understanding of the industry, and the third is what we are doing.
Magic Chopsticks is a company founded in 2015 by a group of entrepreneurs with product and technology backgrounds. At the end of 2017, we got a strategic investment from Kuaishou, so we began to access Kuaishou in 2018. In September 2018, we officially connected to the Kuaishou app to provide saas tools for e-commerce transactions for the anchors of the Kuaishou ecosystem. At the beginning of 2019, we began to work deeply into the supply chain, helping influencers organize supply chain supply so that they could sell directly in the live broadcast room, and we completed a consignment. At the beginning of 2020, we obtained investment from Tencent, and also connected to the platforms such as Tencent's national K song and MicroVision.
The business model of magic chopsticks is s2b2c model, we link the supply chain and Internet celebrities, Internet celebrities can select the source of goods in our Magic Chopsticks Star Select Merchant Edition app, and sell goods to the C-end through the magic chopsticks store saas embedded in the Kuaishou app; so that the entire (live streaming) link has been opened through our platform.
At the same time, we are a to b company with a very clear positioning. The company's mission has two sentences, the first is to achieve people with dreams. We believe that the influencer group is a group of people who have very dreams, are very hardworking, are very willing to pay and work hard, and we have a sense of mission to help and achieve them. The second is to become the most trusted e-commerce ecological service provider on the platform. We are a part of the entire content ecology, so we must also become the most trusted e-commerce ecological service provider of the platform and help the platform to improve the e-commerce ecology together.
Along the way, we have received strong support from many investors, including strategic shareholders such as Kuaishou, Tencent and Vipshop, as well as institutions and investors such as Zhong Ding, Zhongyuan and Gao Rong.
Wise2020 e-commerce industry new ecological summit site
The second part is to talk about our understanding of the industry.
Many people will ask me: What is the internal logic of live e-commerce represented by Kuaishou? Is it a gust of wind or will it have lasting vitality? After we have analyzed it, we believe that the live e-commerce form represented by Kuaishou is actually an extension of the fan economy. If we extend the historical cycle to the past 30 years, we will see that every change in communication technology and terminal technology will lead to changes in media platforms, such as the rise of the Internet and PCs around 2000, which gave birth to the portal represented by Sina and the sns represented by Renren, and then also produced Internet celebrities such as Fengjie and Furongjie. By 2010, the mobile Internet began to spread, and media forms such as Weibo and WeChat public accounts gradually appeared, resulting in a group of Internet celebrities like Mimon. By 2015, with the popularity of 4G mobile networks, short videos and live broadcast forms began to rise, and promoted the emergence of internet celebrities like Li Jiaqi and Simba who mainly live streamed goods.
At the same time, the logic of monetization has changed. We believe that e-commerce companies that use content platforms such as Kuaishou to do live broadcasting are actually an extension of the fan economy.
How long will this form of content dissemination last? Last weekend, I was in Shenzhen with Huawei people, they in 5G and mobile terminals into a lot of R & D strength, I asked them how long the mobile phone can last, how long the video can last, they still gave a very long expectation, at least 3-5 years such a media form and form, will be a very widespread existence.
Here, I also share some data with you. By the end of 2019, the monthly active users of short videos and live broadcasts combined will be close to 900 million, and this year will certainly exceed 900 million, accounting for 80% of Chinese netizens. In other words, almost everyone is watching the live broadcast, watching the short video. Moreover, the average time spent on this is more than an hour per day. In addition, according to the forecast of research institutions, the scale of live e-commerce can reach more than 960 billion yuan in 2020, reach the level of 1.8 trillion yuan next year, account for 4% of the total online retail sales in 2019, and 15% in 2021. Undoubtedly, live e-commerce is one of the mainstream forms of e-commerce in the future.
At the same time, we have observed three forces in the entire live e-commerce ecosystem, and we judge that a three-legged pattern may be formed in the future. The first force is the live broadcast of our so-called traditional e-commerce platform, which is the live broadcast of the e-commerce platform represented by Taobao, JD.com, and Pinduoduo; the second force is the e-commerce of live broadcast and short video platforms, and the content platform represented by Kuaishou and Douyin is fully embracing live e-commerce; the third force is the live e-commerce of social platforms, represented by WeChat and Weibo, and we also see that the live broadcast of Mini Programs in WeChat is very hot. Therefore, we feel that in the future, live e-commerce will become the standard of the industry under the joint promotion of these three forces, and may form a three-legged pattern.
To sum up, our understanding of the industry. We believe that live streaming is becoming the standard and infrastructure of the e-commerce and retail industry, and the future live e-commerce will be a very important part of the entire e-commerce industry.
In this context, what exactly does Magic Chopsticks do to serve customers in the industry and drive the development of the industry? Specifically, we've done something in three areas, innovation in SAAS tools, innovation in the supply chain, and innovation in operational services.
Specifically, in terms of tools, the company has experienced five years of technical precipitation, we have invested a lot of manpower and material resources for technology development work, the current system can support very high traffic concurrency, about one million users per second at the same time, one hundred thousand users per second at the same time to place orders and 100,000 level message push. Our figure (see ppt) is a real case, this is the Kuaishou big anchor is using our system to trade. At that time, the number of people online at the same time was 600,000, and the live broadcast room was constantly launching spikes. For example, 1, 2, 3 I am this thing online, 1, 2, 3 everyone to the second kill. This can put a lot of pressure on the system in an instant, and our system is very stable. This proves that our technical level and system capabilities are already in a leading position.
You will see that the format and transaction form of live e-commerce are relatively simple, and you may think that it is a second kill, in fact, there are many small functions behind it that everyone cannot perceive. Therefore, last year, our product updates were done 120 times, and on average 3 days, we had to update some products, launch some functions, and launch more than 100 new features in total. And this challenge for us is very big, our users sixty or seventy percent are high school and below education, their awareness of new things is actually a certain difficulty, so we in the technical stability and product feature richness at the same time, but also to spend effort to make this thing as simple and easy to use, which also puts forward a relatively large challenge to our product design and technology.
Because we are deeply involved in the field of live e-commerce, especially in the content of live e-commerce scenarios, we need to do a lot of plug-ins that are close to the characteristics of the scene. Inside Kuaishou, if you understand, you know that there is a scene called hitting the list, that is, the merchant runs to the live broadcast room of the big anchor to brush gifts. However, whether it should be listed or not, how much money should be used to fight, are all black boxes, no one answers. Many people have also lost a lot of money because of the list. Based on the analysis of big data, we have developed a plug-in for the list assistant, which is to help merchants carry out more accurate traffic delivery. In addition, we also help influencer users tell them what kind of cover is more likely to be clicked and followed, what kind of theme is more likely to be popular, and so on. In addition, we have developed a lot of tools and plugins that fit into the industry and this scenario.
For our users, magic chopsticks have also launched some customized products, for suppliers, we have specially launched a supplier version, not only can be supplied to the anchor in need, but also can find their own anchor to bring the goods hanging link, the settlement of the entire transaction link and so on. In addition, mcn institutions generally have the need to manage anchors, fund collection and performance management, so we customized the mcn agency version for this purpose.
Let's talk about what we do in the supply chain. We believe that a reliable supply chain is the lifeblood of live e-commerce. You must have seen many head anchors roll over when doing live broadcasts. Either it is caused by the problem of the product, the problem of the service or the problem of the after-sales service. It turns out that under the format of B2C, a business can not do well at most is your own problem, but in the scene of live e-commerce, all the contradictions will be concentrated here in the anchor, if the user is not satisfied, it will brush the comments below with rhythm, the anchor will be difficult to start broadcasting, bringing great pressure to the anchor. So we think the supply chain is the lifeblood.
After two years of accumulation, we have now selected 300,000 SKUs that can adapt to live broadcast scenes in a large number of commodities, with category coverage of 90%, more than 95% of live broadcast hot goods will be in our place, and the commodity library is also rapidly iterating.
In the middle of this process, we have also accumulated some experiences and methodologies for creating explosive models, such as this bee venom toothpaste (see ppt), from unknown brands to kuaishou hot spots and explosive models, many anchors are selling this toothpaste product, and such heat will also spill over to other b2c e-commerce platforms.
This year we made a snail powder, called Heweifang, is a brand founded by a veteran of the Hong Kong garrison, with a history of 20 years, the original in Shenzhen Huaqiang North to open offline stores. Later, he wanted to pre-package the thing and sell it through the online channel. The product is done well, the factory is invested, the investment is not small, and it turns out that there is no opportunity in the original B2C channel, and it cannot be rushed out. By chance, we found us, we felt that this product is very suitable for promotion in Kuaishou, we re-packaged, defined, priced the product, and found a large number of anchors to promote at a unified time, which became a hit. Now this product can achieve 10 million monthly sales, and the growth rate is very fast. At the same time, this heat has spilled over to other e-commerce platforms, and without any intervention, sales on other platforms are also steadily increasing.
The third is in terms of service, everyone here is very familiar with live e-commerce, but for a large number of suppliers and business users, they are still quite ignorant, we are equipped with teaching and research and lecturer teams, specifically for this ecological research rules and gameplay, made into courseware and content to share. On the one hand, through our own team of lecturers on the live broadcast platform to tell everyone how to play, on the other hand, we also output these materials to thousands of lecturers across the network free of charge, helping them to pass these cutting-edge content to merchants and our influencer users, to help them improve. In addition to our own lectures, our courses are also exported to platforms such as Chaos University, so the quality of our courses is still good.
There is also customer service, we have a customer service team of hundreds of people. Helping merchants and users deal with customer service challenges every day. Now customer service can basically be online all day, and customer service satisfaction is relatively good.
We will also carry out some activities in stages, not only the activities of the anchor side, but also sometimes pull some stars, such as Yang Di, Li Weijia, etc., to interact with some big Internet celebrities. For example, in May, we planned an interactive live broadcast of Xiao Shenlong, which sold 33 million in 5 hours, and the results were OK, but what made us even happier was that we sold a lot of big-name and cross-border goods in this live broadcast. We believe that as long as the quality of your goods is good, your cost performance has an advantage, in this channel, in fact, anything can be sold. Because a platform like Kuaishou is already hundreds of millions of users. The platform with hundreds of millions of daily active users is a national-level application. This is full of people of various consumption levels and consumption capabilities, as long as our products are good enough, with the conversion ability of the anchor, any product can be sold well in such channels.
In addition to online, we also made the service more localized this year, closer to our users, we now set up a live broadcast base in more than 30 places across the country, the functions of this live broadcast base include warehousing, training, planning, etc., can be more localized, landing to help businesses settle into this ecology, help anchors get some services here. Our goal is to achieve 100 live broadcast bases to help the platform jointly improve the entire infrastructure of live e-commerce.
To sum up, as a relatively young startup, we are very fortunate to cut into the ecology of live e-commerce. Looking forward to the future, we still have to return to the essence of to b, return to the original intention, achieve people with dreams, achieve anchors, achieve our supplier groups, and always help the platform to do some things in the e-commerce ecosystem. Then, we will continue to deepen and innovate in our trading tools, in our supply chain system and service system, and jointly serve the entire ecosystem, including Internet celebrities, MCN institutions, brand owners, factories and so on.
We believe that the entire ecology of live e-commerce is still in a very early stage, everything has just begun, the future is unlimited, and we also hope to be able to work with all of you here and partners in the industry to achieve a win-win situation, promote the development of the entire ecology together, and achieve success together.
That's it for my sharing, thank you!