The longest Double 11 in history, the e-commerce war enters a new stage

This year's Double 11 Shopping Festival not only marks a consumer carnival, but also reflects the strategic shifts of major e-commerce platforms and the adjustment of the market competition landscape. From the longest Double 11 event cycle in history to the unprecedented support of major platforms for merchants, these changes indicate new trends in the e-commerce war.

In recent years, there has been a funny unspoken rule about Double 11: As the founder of Double 11 and the largest e-commerce platform in China, peers will wait and see the Double 11 time of Taobao and deliberately start before Taobao. The logic here is that the earlier you start, the more you can get the first wave of sales.

Taobao has suffered a lot in this regard in the past few years, so this year's Double 11, which started on October 10, is the longest in history.

The change of time is only a small part of the domestic e-commerce melee. According to a Goldman Sachs report, Taobao Tmall's market share will drop from 66% in 2019 to about 45% in 2023, a drop of 1/3 in four years. In the domestic market where the growth of mobile Internet has peaked, every share lost by Taobao Tmall is due to the close combat with its competitors.

So you can visibly perceive the new changes in this Double 11.

For example, Taobao completed the interconnection with WeChat before Double 11, and WeChat users can open the Taobao product link shared in the WeChat chat box and directly complete the product selection, ordering and payment. For another example, the platforms that have been engaged in the "refund only" policy for half a year have also increased their support for merchants, and the Taobao system even shouted the slogan of "Do Double 11 again".

From building walls to tearing down walls, from collectively learning from Pinduoduo's policy of only refunding to promoting favorable measures for merchants, whether consumers or e-commerce practitioners, only by better understanding the platform's changes can they make choices that are beneficial to themselves.

01 Double 11 is about to start, and the platform is trying hard to show goodwill to merchants

Combining the promotion strategies of various platforms, we can see that restarting pre-sales and extending the promotion period are one of the highlights of this year's Double 11.

According to the official announcement of Taobao, the first wave of Double 11 pre-sales for Taobao Double 11 in 2024 will start at 20:00 on October 14, and the entire cycle will show a three-wave outbreak.

JD.com will not have a pre-sale phase for Double 11 this year, and will launch the first wave of advance purchases at 20:00 on the evening of October 17.

Kuaishou's Double 11 will enter the warm-up phase on October 16, and the official period of the event will be from October 18 to November 11. The event is divided into five stages: preparation period, warm-up period, opening day, category day, and carnival day.

In order to assist the development of merchants and seize the development advantages of Double 11, major platforms have also launched a number of preferential policies to help merchants reduce operating costs.

On September 24, Tmall Double 11 officially announced that this year Tmall will invest hundreds of billions of yuan in Double 11 to help merchants grow their business from multiple dimensions such as promoting transactions, expanding customer traffic, and reducing costs.

In terms of traffic expansion, Tmall will invest 10 billion yuan to purchase traffic during Double 11, and cooperate with more than 200 Internet platforms to expand customer traffic for merchants. Before the Double 11 this year, Taobao and Tmall will officially support multiple payment methods such as Alipay and WeChat.

In terms of cost reduction, the Taobao and Tmall platforms have fully launched the return service, which reduces the return costs for merchants by about 20% to 30%; the platform will 100% refund the Tmall commission for products participating in the "10 billion subsidies"; during the Tmall Double 11 period, Taobao merchants will fully implement commission-free big promotions and commission-free store broadcasts, and will also unbind freight insurance for Taobao merchants.

JD.com also helps merchants in many aspects, such as launching a 100 billion traffic support policy for merchants, helping white-label products and factory-direct products to obtain more traffic and price subsidies, and launching an advertising reward pool for merchants; providing merchants with 20 AI tools for free, covering product operations, order management, customer service reception and other aspects; JD Logistics provides platform merchants with warehousing service fee coupons, business warehouse new signing discounts and other policies, and JD Logistics provides special freight insurance subsidies for low-profit orders.

According to Yibang Power, Pinduoduo upgraded its original "compensation for overpriced products" service to "double compensation for overpriced products", which took effect on November 16 and is applicable to all products participating in the "10 billion subsidies" campaign. At the same time, a new merchant exit mechanism was added.

The number of platform players is also increasing. This year, Xiaohongshu ushered in its first Double 11, the "once-a-year shopping carnival", which will officially start on October 12 and last until November 11. The carnival will launch innovative online theme blocks. Users can enter the "block" through search and notes, and collect stamps to redeem goodies while browsing live broadcasts.

02 A brand new Double 11 may usher in e-commerce reform

Some merchants have told Bohu Finance that even if small and medium-sized merchants do not participate in the event, their sales will not change much.

Behind this is the fact that the final point of e-commerce competition is approaching.

The essence of e-commerce is more efficient connection, so that supply and demand can be better matched. The competition in e-commerce is basically carried out around these two dimensions. Shelf e-commerce based on the logic of "people looking for goods", live broadcast e-commerce based on the logic of "goods looking for people", and Pinduoduo based on low prices and group buying all use their advantages in these two aspects to occupy the market.

The wave of consumption downgrade has forced Taobao and JD.com to learn from Pinduoduo, and has also made billions of yuan in subsidies a daily routine. The Double 11 promotion, which was centered around low prices, is losing its original appeal.

But the facts have proved that blindly low prices can hardly become a platform's competitive advantage: in core categories, prices on various platforms have been aligned, and unscrupulous attempts to please users will only cause merchants to flee.

Although low price or cost-effectiveness may still be the key to competition for some time to come, consumer demand is becoming increasingly differentiated, and how to meet consumer demand from the supply side is becoming important.

As a Tmall insider said, the Double 11 merchant policy is a continuation of Taobao Tmall's cost-cutting measures this year. This year, the platform has been fully "relaxed" to only refund, launch experience points, cancel Tmall annual fees, etc. In the current e-commerce environment, what most merchants need is not a more inward-looking platform operation, but someone to reach out and save them from the water and fire.

Taobao was the first to realize this.

After the 618 shopping event ended this year, Taobao Group held a closed-door meeting for merchants. At the meeting, it was made clear that Taobao weakened its absolute low-price strategy and changed the search weight allocation system back to allocation based on GMV. After changing back to allocation based on GMV, Taobao's assessment focus this year shifted to GMV and AAC, and no longer pursued high DAC brought by low prices.

On August 9, Taobao launched the "refund only" optimization strategy for merchants, and then launched a new service "Return Treasure" in early September, which brought a 10%-30% reduction in return and exchange costs for micro-businesses. According to the latest data from Taobao, two months after the new strategy was launched, Taobao intercepted more than 400,000 unreasonable "refund only" transactions per day, and the unreasonable "refund only" phenomenon has been almost completely rectified on the Taobao platform.

Along with optimizing “refund only”, Taotian also continues to launch measures such as refundable technical service fees, refundable promotion fees, and cancellation of Tmall annual fees to reduce merchants’ operating costs.

At the same time, JD.com sticks to its low-price strategy, and its starting point is to cover more merchant groups and consumers and increase the platform traffic available to merchants.

This change is almost from the inside out. In addition to the iteration of the platform's own initiatives, there has also been new progress in the interconnection and interoperability between platforms.

Since the beginning of this year, Taobao first launched WeChat Pay, and then Taobao and JD.com reached cooperation in logistics and payment.

In cooperation with WeChat Pay, Taotian is expected to gain a larger traffic pool and improve the user experience, which will benefit merchants. Taotian’s cooperation with JD.com will improve the delivery experience of merchants and the logistics experience of consumers, while JD Logistics will increase the number of express orders and increase the market share of JD Logistics’ warehousing management services.

In the view of Bohu Finance, major platforms intend to stimulate market demand through a series of interoperability actions, thereby injecting new vitality into the industry and bringing about new e-commerce changes.

The interconnection between platforms is expected to enhance the competitiveness and service level of the entire industry, provide users with richer and more diverse products and services, and further improve the service quality and user experience of the platform.

This year, e-commerce platforms have launched various measures to achieve interconnection and interoperability. What are the results? Can the Double 11 shopping festival bring new vitality? These will be verified in this Double 11 shopping festival.

References:

1. Labor News: The promotion cycle is extended again, and the "Cat and Dog Fighting Douyin and Kuaishou" Double 11 warm-up match begins

2. Dahe Financial Cube: No more low prices this year? Double 11 preheating begins, e-commerce platforms compete to give merchants "big red envelopes"

3. Yiou: Don’t be afraid of “refund only” on Double 11! Two months after the “new policy” was launched, Taobao’s unreasonable “refund only” policy has been rectified in all aspects

4. Ebang Power: Xiaohongshu Double 11 will be launched on October 12. The number of purchasing users has increased 4.3 times in the past year

5. Kanchai.com: Pre-sale returns, activities are moved forward again, how can merchants get ahead of the game on this "Double 11"

6. Beijing News: The Double 11 competition started early, and the competition landscape may change this year

7. Taobao Express: Taobao intercepts more than 400,000 unreasonable “refund only” requests every day

Author | Lynn