Wednesday, October 21, 2020

Behind the Double 11 carnival is more than "buy, buy, buy"

 2020 is extraordinary compared to previous years. In order to implement the decision and deployment of the central, provincial party committee and the provincial government on expanding domestic demand and promoting consumption, further prosper the consumer market, release consumption potential, and improve consumption quality, this year's Double 11 will also fully launch the "New Consumption·Drunk Hangzhou" brand , High-level construction of an international consumption center city adds a key to it.

Nowadays, advancing new consumption and releasing consumption potential is an inevitable requirement for adapting to the upgrading of social consumption demand and satisfying people's yearning for a better life. From Double 11 to the 12th year, the inflection point of traditional Chinese e-commerce has come. The sinking of the market, e-commerce live broadcast, online and offline integration, and green logistics will become new trends in the 2.0 era of China's e-commerce.

Look at how Hangzhou leads new consumption and promotes new consumption through Double 11, thereby strengthening the city's new momentum and enhancing the city's core competitiveness.

The Internet digital economy is providing new imagination.

On Double 11 in 2019, major e-commerce platforms handed in their answer sheets, setting new records: Tmall’s turnover reached 268.4 billion yuan, JD’s sales reached 204.4 billion yuan, and Suning’s omni-channel order volume increased by 76%... According to the data of business giants, the new record is getting higher and higher year by year, and there are surprises, which are also expected. But it is undeniable that these figures have allowed Double 11 to stand at a new height again. There is no doubt that this year's Double 11 home appliance vendors will set another record.

2020 is the 12th year of Double 11. New consumption is driving the deep transformation of the commercial society. This process reconstructs the relationship between people, goods, and markets, and creates a new outlet for digital business. At this point, numbers are not so important for Double 11, and more important is the value created for consumers and the transformative significance of business behind Double 11.

New supply: innovation and innovation continue to meet the diversified innovation

Every year during Double 11, the consumption enthusiasm in cities across the country is soaring day and night, which reflects a strong new consumption power.

"Only through continuous innovation and diversified supply strategies can we meet the growing new demands of consumers and effectively release new consumption potential." In response to the nearly 500 million participating users on Double 11 last year, Taobao Tmall President Jiang Fan's promise is " 10 million discounted products and 1 million new products have saved users 50 billion."

In fact, in recent years, consumption and new supply are the key engines for the Tmall Double 11 outbreak. Tmall Double 11 is the largest new product launch node in the year. Last year’s iPhone 11 sold more than 100 million yuan in just one minute, and Dyson’s electric mops sold more than 100 million in 10 minutes last year. Bubble Matlong Jiasheng Mini Series Blind Boxes sold out 55,000 in 9 seconds... At the same time, new products are Tmall’s core strategy , Also opened up new growth space for brand businesses. The perfect diary that broke 100 million in 13 minutes last year and finally topped Tmall's cosmetics category No.1 , not only proves that the Alibaba ecosystem has the ability to incubate new brands on a large scale, but also companies in payment, logistics, data technology, channel management, etc. Service solutions are also helping new brands quickly bear fruit in batches.

In the past ten years, Double 11 has gradually developed from a one-day promotion for single consumers in the Mainland to an omni-channel shopping festival. More diversified sales channels, product categories and marketing strategies have attracted more consumers in the international market. .

These phenomena show that consumption is undergoing tremendous changes due to digital technology. Alibaba will export its 20 years of thinking and capabilities to the outside world, and build the Alibaba business operating system to help brand merchants build an endogenous drive for digital growth. Therefore, everyone from multinational companies to emerging brands can share the dividends of new consumption.

New crowd: the rapid rise of the sinking market, deep cultivation of new users

"100 million new users participate." This is Jiang Fan's most critical KPI for Tmall Double 11 in 2019. So, where do these 100 million new users come from? How to meet the different needs of young people in small towns, Generation Z, and silver-haired people at the same time is the biggest issue for Tmall Double 11 in the past two years.

In the past, Ali’s strategy of "sinking the market" has provided a strong guarantee for achieving this goal. Last year, the Taobao hometown version, which was in charge of rural Taobao, has been fully integrated with mobile Taobao. The data and supply chain are connected together. The new brand "Xi Niao" created by Cainiao specifically for rural logistics has also been officially put into operation.

Jiang Fan introduced that in the past year, the user scale of Taobao and Tmall continued to grow rapidly. Alibaba’s China retail market’s annual active consumers reached 742 million, and mobile monthly active users increased by 119 million, of which 70% of new users came from the sinking market. It is expected that there will still be a lot of room for growth in the next two to three years. In addition, according to Ali's disclosure, the MAU (monthly active users) of Taobao special edition in August 2020 reached 55 million. Taobao Special Edition has become the main channel for users in the sinking market to buy cheap goods.

It is worth noting that for several other major e-commerce giants, sinking the big cake of the market has also been the focus of their efforts in recent years. Since September 19, 2019, the "Jingxi" set up by for the sinking market has deployed 183 industrial zones, helping more than 1,000 merchants achieve sales of more than 10 million, and 70% of users come from Tier 3 to Tier 6 cities. In the second quarter of this year, the number of orders from users in sinking emerging markets increased by 84.2% from the first quarter. During the 618 period of this year, the daily order volume of Jingxi exceeded 10 million. And just last Friday, the number of JD PLUS members that day exceeded the 20 million mark.

Speaking of sinking markets, Pinduoduo must be mentioned. In 2019, Double 11 only released an open letter in a low-key manner stating that there is no more "Double 11 data" to be disclosed. However, from the second quarter financial report released by Pinduoduo this year, the numbers cannot be underestimated: As of June 30, the number of active buyers on Pinduoduo’s platform reached 683.2 million, an increase of 41% from 483.2 million in the same period last year. A net increase of 200 million was a net increase of 55.1 million active buyers in a single quarter.

New scenario: Deep integration of online and offline live broadcasts to improve transaction conversion

The Double 11 since last year is not only an upgrade of goods and users, but also an upgrade of new shopping experiences and scenarios. Taobao Live, which has extremely high user stickiness and transaction conversion, is undoubtedly the biggest highlight of Double 11.

According to data, during the whole day of Double 11 in 2019, Taobao live broadcasts brought close to 20 billion transactions, and more than 10 live broadcast rooms led to over 100 million transactions. More than 50% of the merchants participating in Tmall Double 11 have achieved growth through live broadcast.

When information flow has become one of the most core ways for consumers to browse Taobao, in addition to recommending products through information flow, many new forms such as live broadcasts and short videos are now incorporated. For example, this year's Taobao live broadcast drove the upsurge of e-commerce live broadcasts. In the past 12 months, Taobao live broadcasts had a turnover of more than 300 billion and continued to maintain rapid growth. The number of Taobao live broadcast users increased by 160% year-on-year, and the year-on-year growth rate of merchants participating in live broadcast reached 220%.

In addition, since 2016, Alibaba has begun to fully promote new retail. Commercial forms such as Hema Fresh Food and Intime Department Store have been digitally upgraded and have also ushered in an outbreak of Double 11 over the years. Since joining Alibaba, Intime Commercial Group has realized the digitalization of 10 million members, and completed the digital reconstruction of goods and scenes. The launch of the Miaojie APP made Intime the first department store "not closed", and has achieved 18 cities. Timed up to 2 hours.

In addition, Suning started from offline retail, and has continued to race offline in the years since participating in Double 11 to further enrich and improve the offline scene format. 2019 is the first Double 11 after Suning's full-scenario retail layout is completed. According to Suning's 2019 Double 11 battle report, Suning's omni-channel order volume on Double 11 increased by 76%. Among them, more than 13,000 stores participated in the war. Suning Plaza and Suning Tesco Plaza exceeded 10 million passengers on the 11th.

Reporter's Notes

Although Double 11 has become famous in Ali, it has experienced fierce retail competition, and the home of Double 11 is no longer the "private property" of a certain company. With the introduction of new retail and smart retail, more and more online and offline businesses have taken the Double 11 train, which can give them new connotations. This commercial "super project" reveals the huge opportunities in new consumption and shows the infinite potential of the Chinese market.

At this moment, new consumption is, in a sense, consumption based on information technology such as big data and artificial intelligence, so as to realize the benign interaction and cycle of consumption and social reproduction. Looking back over the past years, the significance of Double 11 is not just to trigger purchase behavior, but to match demand with Internet means such as big data, reduce matching costs, and activate the circular chain of consumption and social reproduction. It is not difficult to see that optimizing the configuration of supply and demand and reducing costs are the logical starting point for the continuous high turnover. The improvement of both ends of supply and sales is also the commercial value of Tmall Double 11 and e-commerce, new retail and new consumption.

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