WeChat Video Account is a runner-up in this Double 11

Compared with other platforms that are making a big splash, Video Account is more like a runner-up, taking one step at a time and looking ahead. One of these two steps is Xiaohongshu, and the other is Kuaishou.

It’s the fourth Double 11 for WeChat Video Account, and it’s taking one step at a time and looking ahead at two steps.

This year's Double 11 battle line has been extended again. The mainstream e-commerce platforms have already started selling the first wave of spot goods on October 21, while the registration for the WeChat Store Double 11 Good Products Festival has just started not long ago. The entire event cycle is shortened by half compared to the mainstream e-commerce platforms, starting on October 31 and ending on November 11.

Don't be in a hurry, and run along halfway. This may just be the superficial attitude of WeChat Video Account's live e-commerce. The inner core is still the strategy of taking one step at a time and looking ahead.

For example, during the 618 promotion this year, Christy Chung was the benchmark case for live streaming sales on video accounts. Tencent Advertising officially participated and began to cooperate with investors a month in advance. The result was: "The first live streaming sales event on video accounts with more than 10 million viewers was born." The MCN agency behind Christy Chung, Weiyu Times, also took this achievement as an official recognition from Tencent. The outside world once deified Christy Chung as the "No. 1 Live Streamer on Video Accounts."

Should such a proud achievement continue on Double 11?

Four months later, Tencent’s advertising department no longer participates in the operation of the video account. Christy Chung is not as popular as before, but she still maintains an active live broadcast on the video account. Currently, only two live broadcasts with goods have been confirmed in November. The company behind it, Weiyu Times, chose to prepare another live broadcast with goods by star Jin Qiaoqiao on Double 11 this year.

Video accounts have cultivated native sales experts, but lack super anchors comparable to other platforms, which was once one of the biggest expectations of the outside world for video account live e-commerce. Today, Christy Chung has proved that video account live e-commerce has the ability to create super anchors, and the re-employment of out-of-date stars in the live broadcast sales market has also become the most obvious track in the video account in the era of micro-entertainment.

It is difficult to find out the characteristics of Video Account on this year's Double 11. Compared with the fanfare of other platforms, Video Account is more like a runner-up, taking one step and looking two steps ahead. One of these two steps is Xiaohongshu and the other is Kuaishou.

This step may be an accumulation or a detour, and the key to the problem lies in looking up at the road and how far you can go in the next two steps.

01 It’s not just about video account e-commerce

"The future of video account e-commerce is WeChat e-commerce. This year's adjustment is to open up a complete closed loop of commercialization within the WeChat channel, rather than just being as simple as video account e-commerce." A video account industry belt service provider said.

The product drive of video accounts is often more obvious than the operation drive. After 618 this year, the most obvious change was that in August, video account stores began to upgrade to WeChat stores. On the surface, it was just a name change, but behind it was the connection of various traffic channels within WeChat, the improvement of brand certification and store naming system, and the lowering of entry thresholds and deposits.

This change stems from WeChat’s emphasis on live e-commerce business, and team changes precede product changes.

In May this year, the WeChat Video Live e-commerce team was merged into the WeChat Open Platform team and further integrated with the Mini Program and Official Account teams, which means that the status of small stores and live e-commerce has been elevated to the same level as the Video Account, Mini Program, and Official Account. The original WeChat Video Live e-commerce team was transferred to the head of the WeChat Open Platform.

Two months later, the operation and management of live streaming on Video Accounts were transferred from Tencent’s advertising department to the WeChat Business Department. This series of moves was considered by the outside world to have enhanced the status of live streaming e-commerce within WeChat, but do these changes have a significant impact on the ecosystem of Video Accounts?

The product form and infrastructure capabilities of WeChat's e-commerce still need to be improved. For example, the smart delivery tool Video Account Global Access launched by WeChat ecosystem this year was once considered to be a counterpart to the huge Qianchuan within Douyin's e-commerce system. This is a one-stop full-traffic marketing and promotion tool launched by Tencent for merchants and influencers. It can change the backward situation of Video Account's e-commerce delivery tools, and is therefore highly anticipated.

"(Quanyutong) has not changed much, and has always been in a lukewarm state." A video account service provider told "Blue Hole Business" that Quanyutong's effect on business growth is not that obvious. This service provider became one of the video account service providers two years ago. Now, his company connects with more than 2,000 mid-level video account influencers, and last year's GMV reached 100 million.

Improving the service provider system and enhancing supply chain management capabilities is one of the key points of video account live e-commerce infrastructure construction this year, and is also the only way to cope with the fierce competition in the current e-commerce industry.

The above service provider said that live streaming e-commerce as a whole has entered a stage of high barriers and super vertical competition, and less than half of the merchants in the entire industry can make profits. He is not too excited about the current Double 11, because Double 11 can't change anything, and the value of marketing is far greater than the value of sales. "The consumer user base is already in a relatively stable state. It's nothing more than buying more on Double 11 and less on Double 12."

This Buddhist attitude towards Double 11 can be seen as the video account still cultivating its internal strength. Behind these service providers across the country are millions of influencers and merchants live streaming, which has become the mainstream force of video account live e-commerce.

According to third-party data cited by Huxiu, in the third quarter of this year, there were more than 1.2 million merchants operating video accounts, with more than 60% of merchants having monthly sales; there were more than 70 million active e-commerce purchasing users, with an average of 2.5 orders per month. Video accounts have stabilized the merchant ecosystem, and the user scale and conversion efficiency are both increasing rapidly. However, WeChat responded that the data was untrue.

Therefore, the current Double 11 may not be that important for video account live streaming e-commerce. Live streaming e-commerce is first and foremost a systematic project, and the underlying construction that makes up for the shortcomings is the direction for steady progress.

02 First, we need an accurate definition

At two o'clock every afternoon, Zhihe's video live broadcast room "ICICLE-Xiaohe Show" will go online on time, with more than 60 clothing products and a live broadcast time of up to four or five hours.

At the same time, Zhihe’s official live broadcast room on Xiaohongshu also started broadcasting simultaneously, with the same products, the same anchors, and the same content. The only difference was the number of viewers. The number of viewers in the video account live broadcast room was higher than that in Xiaohongshu.

Brand merchants are one of the key areas of strong support for Video Account. In August this year, WeChat Open Class showcased Zhihe as a representative of Video Account e-commerce. It mentioned that the "Good Years" live broadcast room is one of Zhihe's main battlefields for selling goods, and quality is the basic condition for Zhihe to sell 2 million yuan per month in the Video Account live broadcast room. "According to estimates, Zhihe's annual sales on Video Account will exceed 30 million yuan."

Zhihe is a high-end women's clothing brand, and high unit price is one of its characteristics.

But in fact, Zhihe also attaches great importance to the live broadcast room of Xiaohongshu. During the 618 period this year, Zhihe cooperated with Xiaohongshu on the "Brand Popularity Day" to launch the Shanghai Museum's joint series of new products. The sales on the first day exceeded 780,000, and it topped the live broadcast room brand list within less than 10 minutes of the broadcast. Among them, new product sales accounted for 80%, and the user's average customer price exceeded 3,700 yuan.

The data dimensions released by both parties are different, but the product sales displayed on the store front page will not lie.

Up to now, the sales volume of Zhihe’s flagship store on Xiaohongshu is shown to be 10,000, and the sales volume of the small store on Video Number is shown to be 12,000. It can be said that they are on par with each other. However, it is slightly inferior to Douyin, which has a more complete e-commerce ecosystem. The number of fans of Zhihe’s official Douyin flagship store has reached 155,000, and the store sales volume has reached 60,000.

It can be said that high-quality brand merchants like Zhihe are eagerly sought after by Xiaohongshu and Video Account; and for merchants like Zhihe, Xiaohongshu and Video Account are both its new incremental channels.

Live streaming e-commerce is the inevitable path for Video Account and Xiaohongshu in the future. The common point between the two is that they entered the market late, maintained strong growth momentum, and are the focus of their own business breakthroughs. They both want to find a new way out of the mature e-commerce formats of Douyin and Kuaishou and take a unique path.

The biggest revelation that Xiaohongshu brings to Video Account is that it must first give an accurate definition of its own live streaming e-commerce ecosystem, which determines how far-sighted the platform’s vision is.

From proposing "buyer e-commerce" last year to evolving its e-commerce business into "lifestyle e-commerce" this year, the changes in Xiaohongshu's e-commerce business first express the concept of differentiation, and secondly the diversification of lifestyles and insights into increasingly segmented user needs. Buyers and managers are essentially demonstrating professionalism and serving specific groups of people. They are also key roles in breaking the routines of live e-commerce.

This e-commerce positioning of serving a more precise group of people is obviously completely different from the e-commerce ecology of Video Account, because Xiaohongshu's users are more youthful.

Therefore, even if quality merchants like Zhihe can gain growth in Xiaohongshu and Video Account e-commerce, for Video Account e-commerce, one Zhihe is not enough. The majority of merchant groups that are more in line with its own attributes are a more important sign. Only in this way can it differentiate itself from other platforms and allow merchants and consumers to turn the "possibility" in huge traffic into "necessity."

Of course, this will require Video Account to spend more time to verify.

03 Waiting to surpass Kuaishou?

The end of every year is the time for live streaming e-commerce platforms to flex their muscles and achieve results.

At the end of last year, Douyin e-commerce's payment GMV exceeded 2 trillion, Kuaishou e-commerce's GMV exceeded 1 trillion, and Video Account e-commerce's GMV scale was around 100 billion. According to the 3-fold growth rate mentioned in last year's WeChat Open Class, the outside world believes that the GMV target of Video Account e-commerce in 2024 is 300 billion.

In terms of revenue, Video Account e-commerce is far behind Douyin e-commerce, but benchmarking against Kuaishou e-commerce may be the most likely thing in the short term.

From the user level, Video Account has already posed a threat to Kuaishou. Kuaishou's daily and monthly active users now maintain at 390 million and 690 million respectively. According to a research report by Sealand Securities, at the end of last year, Video Account's daily and monthly active users reached 450 million and 900 million respectively, while Douyin's daily and monthly active users were 760 million and 1.1 billion respectively during the same period.

"Video accounts are a bit like Kuaishou, both have strong trust attributes and private domain attributes, but there is no way to tell the story of trust in e-commerce again, and we need to find a new definition." A video account service provider believes so. He personally believes that video account e-commerce will surpass Kuaishou within three years and become the second in the short video industry.

There are many reasons to express optimism, such as WeChat and WeChat red envelopes. These two products of Tencent have achieved latecomers in the fields of social networking and payment. Tencent was not the earliest entrant, but became a leader in this field during the development process.

However, Kuaishou’s financial report does not support this optimism. In the first quarter of this year, Kuaishou’s e-commerce GMV increased by 28.2% year-on-year. Although it declined in the second quarter, it still maintained a growth rate of 15%. If Video Account e-commerce wants to surpass others, it can only achieve this by coming up with a higher compound growth rate.

In fact, the acquaintance relationship attribute of Video Account means that it is destined to compete with Kuaishou in terms of private domain traffic capabilities.

Nowadays, "follow-up purchases" and "returning customers" are very important indicators in video account stores. Some video account service providers believe that pulling users back to the private domain for conversion is a very important ability of the video account, which can save merchants the cost of reaching public domain users.

Previously, the transaction ratio of live broadcasts on many high-priced video accounts was about 3:7, that is, a video account sold 1 million products, but the transaction volume in the front-end live broadcast room was only about 300,000, and the remaining 700,000 was all generated from private domain traffic.

The 70% share of private traffic in e-commerce revenue is Kuaishou's performance in the third quarter of 2021. During the same period, the share of private traffic in live e-commerce taken out by WeChat Open Class was 50%. It can be said that private traffic is a barrier to Kuaishou e-commerce and a moat to video e-commerce. From this point of view, Kuaishou e-commerce is a better benchmark for video e-commerce.

Of course, the relationship between Kuaishou and the top anchors is even more worthy of being used as a lesson for video account e-commerce. For example, Simba resumed broadcasting on Double 11 this year and achieved a GMV of 6.41 billion in a single day. The previous quarrel between Simba and Xiao Yangge pushed the competition for the top anchor of live e-commerce to the peak of public opinion. This series of operations proved that Simba and Kuaishou cannot do without each other.

The former top anchors have either retired or failed, which foreshadows a new round of industry reshuffle. There will be more and more actions to divide the cake. Are the anchors of video account e-commerce ready?

Earlier this year, Ma Huateng praised the WeChat video account business at the annual meeting, hoping that WeChat would further "sprout new buds from old trees" and fully expand live e-commerce. Therefore, whether the video account live e-commerce can achieve a GMV of 300 billion this year may be the best time to verify "new buds from old trees."

Written by | Zhao Weiwei Reviewed by | Chen Qiulin This article is written by the author of Operation School [Blue Hole Business], WeChat public account: [Blue Hole Business], original/authorized to be published on Operation School, and any reproduction without permission is prohibited.

The title image is from Unsplash, based on the CC0 protocol.