Alibaba will announce its latest financial report on August 10, 2023. Analysts generally expect Ali to return to growth, especially Taobao. Not long ago, Goldman Sachs' report on user activity on e-commerce platforms was widely circulated in Moments.
The report shows that Taobao’s daily active users have risen sharply year-on-year, and the user activity of the e-commerce platform has increased for three consecutive months, while in June it increased by 4% year-on-year. According to the annual data from April 2022 to June 2023 released by a third-party testing agency, Taobao’s monthly active data in the second quarter of this year has climbed significantly, with a total of nearly 877 million, while Taobao’s daily active users reached 380 million.
At the moment when Internet traffic has already peaked, user activity is the core competitiveness of the platform. The data performance of Taobao this time gives us a new perspective on the dispute over the development model of e-commerce platforms in the past two years.
2023 is the year of the "decisive battle" for the e-commerce platform, and the two e-commerce platform models have also entered a mature stage.
Since 2018, more and more players have entered the e-commerce market, and popular e-commerce concepts in the market are also emerging one after another. What social e-commerce, trust e-commerce, interest e-commerce, new market e-commerce, global interest e-commerce, as long as it is a E-commerce companies will always add a title to themselves and be unconventional. But in fact, the word "e-commerce" is finally behind the dazzling concept. No matter how you flaunt your uniqueness with fancy titles, it is still an e-commerce company after all.
After all, there are only two models of e-commerce in China: one is stable and the other is volume.
One is to do ecology, where water is big and fish is big, and Taobao and Tmall are one of the representatives. This model is a win-win situation for the platform and merchants, to develop together, to serve consumers well together, and to create and stabilize the prosperity of the market. In this mode, the platform helps merchants convert uncertain traffic into deterministic "reserved volume" through content construction, membership tools, and special support, forming their own private domains, producing stable retention and repurchases, and thus Realize sustainable operation.
A healthy market must be the sustainable prosperity of the ecology. Platforms and merchants are a flesh-and-blood link that prospers and hurts.
The other is a deformed model derived from the brutal competition in the market: it suppresses the ecology and dominates the platform.
In this model, the platform uses its advantages to the extreme. The platform firmly controls the right to distribute traffic. Almost all the traffic is in the hands of the platform, and the traffic is used to attract merchants. The logic of this model is that the platform either takes advantage of the merchant’s inventory pressure to let the merchant clear the goods at a loss, or induces the merchant to make a deal regardless of everything, which eventually leads to a super high return rate and a lot of waste of resources. He vowed to give the merchants a ray of hope, and tomorrow he will lightly say a word, and easily let the merchants lose their money. Overturning the rain and turning the clouds, life and death are seized.
Suppressing the ecology and dominating the platform is the "volume" mode of the deformed platform. In this system, merchants are exhausted, chasing the command of the platform to change from day to day. Although there is traffic in the short term, it cannot be deposited into store resources and brand assets. There are even no stores at all, only single products. Under this model, merchants are racing horses every day. Under the tense high pressure, merchants only have low prices and transactions, but have no time to take care of user experience and brand building. On the surface, some merchants can indeed achieve high sales in the short term, but these are temporary passing clouds, which are neither sustainable nor long-lasting.
Platform diversification is the necessity of competition. Several e-commerce platforms compete on the same stage, which is also the basis and guarantee for the healthy and sustainable development of the market. However, the deformed platform model runs counter to the health of the e-commerce ecosystem and the sustainable development of the market. Too much "volume".
The essence of the deformed platform model is "involution". One after another, the involution of merchants led by the platform ends up fattening the platform and hurting the merchants. The revenue of the platform is rising steadily, and the advertisements on the platform are rising. It is mourning everywhere.
Those with property have perseverance, those without property have no perseverance. Under the deformed platform model, merchants are precarious and their survival is worrying, and the pressure of merchants' survival will also be transmitted to consumers. A project company that makes a one-shot deal. The companies that live best in this kind of "volume" platform are either good at counterfeiting and shoddy products, or they like to induce consumers to make irrational purchases. Good businesses have nowhere to go, but speculative companies can live comfortably and comfortably. This process is familiar—bad money drives out good money.
The deformed platform model has led e-commerce companies astray. The good news is that the market also has the power and awakening of self-healing. The current e-commerce market has also begun its value return and rational return.
There are multiple dimensions to the competition among e-commerce platforms, but in the final analysis, there are two sides: user experience and ecological construction.
User experience focuses on the user's shopping experience, guarantee and after-sales service. What is different from the past is that the previous e-commerce platform focused on the "scale of users", but now it is necessary to add an attributive - "scale of active users" before the "scale".
The Goldman Sachs Research Report stated that the capital market’s understanding of platform competitiveness has changed from the comparison of “annual consumers” back then to the current competition of “monthly active users” and competition for “daily active users”. One can imagine the intensity of competition among platforms.
Both consumers and merchants have adapted to the current multi-platform e-commerce market. Consumers have basically used Taobao Tmall, JD.com, Pinduoduo or Douyin e-commerce for shopping in e-commerce, and merchants also operate on multiple platforms. The competition between e-commerce platforms in the future will focus on ecological scale and ecological activity. The so-called ecology, technology is the foundation, and "user first" and "ecological prosperity" are actually mutual cause and effect, mutual achievement.
For example, in the above data, Taobao’s “monthly activities” and “daily activities” continue to grow because of the growth of merchants. According to 36 Krypton reports, in the second quarter, the number of new merchants entering Tmall increased by 75% year-on-year, of which 45% were industrial brands and 20% were new consumer brands. Among these new merchants on Tmall, nearly 30 have exceeded 10 million yuan in transaction volume, and nearly 700 have exceeded 1 million yuan.
The easiest way to win consumers is actually to win the support of merchants. A good e-commerce platform is to motivate merchants to better serve consumers by serving them well, rather than brutally "force traffic to make merchants". Judging from the current e-commerce landscape where multiple platforms coexist, in the game between platforms and merchants, the initiative has been between users and merchants, the influence of platforms is weakening, and platforms have begun to be "weakened". Be it Taobao, Douyin, JD.com or Pinduoduo, they all need to use different methods to attract merchants and brands.
For example, Taobao Tmall launched the first marketing IP "Taobao Good Price Festival" for small and medium-sized businesses on June 18 this year, and later released the "Star-making Project" for small and medium-sized businesses. The latest news is that Taotian Group officially established the KA service department, covering all major industries in the three major business development centers of Taobao and Tmall. In addition, Taobao Tmall directly opened the membership operation function for all merchants with zero threshold, and gradually realized from "traffic" to "retention": the operation of high-quality and high-net-worth user groups formed around shopping guides and transactions has continued to become a long-term business model. core business strategy.
In a word, it is necessary to give flow to flow, and to reserve quantity to teach reserve quantity.
The so-called reserve refers to what we said above that the water is big and the fish are big, doing recycling and doing ecology.
The growth of consumer data and business data is a manifestation of the market returning to the right track and consumption recovery, and it is also the result of the return of market value and rationality. Consumers prefer shopping platforms with high cost performance, experience, and after-sales guarantee, and merchants are choosing sales and future business positions. Rather than saying that the head gathering effect of e-commerce platforms is strengthening, it is better to say that consumers and merchants are voting with their feet to choose platforms such as Taobao and Tmall.
The recent market changes have actually revealed to us a simple truth: ecological prosperity is the prerequisite for improving user experience. Only when the ecology is active and merchants have certainty and confidence can they provide users with better services and experiences, and users will naturally choose to vote with their feet. The right path for China's e-commerce in the future is to liven up the ecology and develop together with merchants. Taobao Tmall has made a sample, which is worth learning from other platforms.