It's 2024, and Simba Xiao Yangge hasn't been "fried" enough

In the fierce competition of live e-commerce, the dispute between Simba and Xiao Yangge is not only a price war over a crab, but also a battle for traffic between the two top anchors of the platform. Behind this "fight and kill" is the traffic anxiety and growth bottleneck faced by the live e-commerce industry. Although the live streaming industry has grown from grassroots to mature, the top anchors still rely on the "lowest price" and "traffic first" model to attract consumers. Against the backdrop of slowing industry growth, anchors need to think about how to achieve sustainable development through specialization and innovation, rather than relying solely on price wars and hype.

The "number one brother of Kuaishou" and the "number one brother of TikTok" started arguing with each other.

The cause was that on August 31, when Simba was promoting Mrs. Crab's crab cards, he claimed that he was reported by an anchor who was also promoting the same brand because he sold them too cheaply, which resulted in the sold-out hairy crabs being unable to be restocked. He also implied that the anchor was Crazy Brother Xiao Yang (hereinafter referred to as "Brother Xiao Yang").

Not only that, Simba complained about the after-sales problems of Three Sheep, the company behind Xiao Yangge: "You don't have quality inspection, you don't have after-sales service, you don't have a compensation attitude, and you only have hype."

In response to Simba's remarks, Xiao Yangge did not respond directly at first. Instead, Lu Wenqing, co-founder of Three Sheep Group, stated in a live broadcast, "Everyone should do business on their own platform. We cannot pursue traffic without bottom line just for the sake of business."

On September 2, the war of words between the two sides escalated again. Simba pointed the finger at Lu Wenqing in the live broadcast, and many of the revelations involved his privacy issues. Lu Wenqing first set his Douyin account as a private account, and then released the permissions. On the evening of the 4th, he posted a video on the account saying that "the police have been notified."

On the evening of September 4, Simba posted a long article saying that he decided to give Sanyang a week. If Sanyang still did not treat consumers after a week, he would start to compensate for some of the products of Sanyang consumers and provide after-sales services. Tomorrow, he would arrange to pay 100 million in cash to Xinxuan's assistant until the compensation of 100 million is completed. On the evening of September 5, Simba posted again saying that he had paid the money to Xinxuan's assistant. Xiao Yangge has not responded yet.

This is a war of words caused by a crab, but the two big anchors are not interested in crabs. It is hard to imagine that in 2024, the top anchors of the two major short video platforms are still using war of words to attract traffic.

From their history of success, we can see the past glory of the live e-commerce industry. They both grew from grassroots to the top of the platform, incubated the apprentice matrix live broadcast room, started corporate operations, and told stories about supply chain and private brands.

From these two people, we can also see the dilemma of the live e-commerce industry. According to Analysys data, the year-on-year growth rate of the transaction scale of the live e-commerce market in Q2 this year has reached the lowest point in the past two years, and the anchors have not been able to break away from the development limitations of "lowest price" and "traffic first".

01 Crabs provoke war, and the "big brothers" curse each other

The secret war for the "lowest price" was not uncommon among big anchors before. Let's first briefly reconstruct what happened.

On August 31, when Simba was promoting the "Crab Lady" crab card, his assistant said that the brand was "pointed at and scolded" by a certain anchor because the other party sold it first, but Simba started selling it at a lower price. Later, Simba said that the brand told him that the product had been reported and the sold-out hairy crabs could no longer be added to the link.

Simba mentioned that the reason his prices are cheaper is that he introduced the brand to live streaming e-commerce three or four years ago, and he also participated in the formulation of the online after-sales standards for hairy crabs, and they have been sold out many times, so the brand is willing to give the lowest price.

Although Simba did not name anyone in the live broadcast room, the labels he mentioned, such as "100 million fans" and "international company", all pointed directly to the Three Sheep Group behind Xiao Yangge.

So who sells crab cards cheaper, Simba or Brother Yang?

It is understood that the price mechanism and product specifications of the Mrs. Crab hairy crabs promoted by Simba and Xiao Yangge are different from those given by the brand. This is a standard cooperation model for the brand to avoid direct price comparison and cover different demand groups. It is very common in the industry and there is nothing wrong with it.

• Simba’s mechanism is: 714 yuan for three and get four, which is equivalent to 178.5 yuan per box, with four pairs of eight crabs in one box (male crabs 4 taels and female crabs 3 taels), and a box of iced black tea (330mlx6 specifications) for free.
• Brother Yang’s mechanism is: 298 yuan per box, 0 yuan for the second box, which is equivalent to 149 yuan per box, with four pairs of eight crabs in one box (3 taels for male crabs and 2 taels for female crabs).

Looking at the price per box, Brother Xiao Yang's price is cheaper, but Simba sells 8 taels more hairy crabs per box than Brother Xiao Yang. Calculated by weight, Brother Xiao Yang's price is 74.5 yuan per catty and the crabs are small in size, while Simba's price is 63.75 yuan per catty and the crabs are large in size. The price difference per catty between the two is 10.75 yuan.

Industry insiders said that female crabs are generally more expensive than male crabs, and female crabs are divided into more than 3 taels, 2.5 taels and less than 2.5 taels. "3 taels of female crabs (net weight without rope) generally cost 25-50 yuan per piece, 2.5 taels cost 15-25 yuan per piece, and those less than 2.5 taels are worthless."

The Crab Card promoted by Brother Yang is more suitable for users who pursue cost-effectiveness. In fact, there is no need to compare it directly with the Crab Card promoted by Simba. Then why are the two sides still arguing?

Xu Fang, the founder of a maternal and infant brand who has come into contact with a large number of anchors, told "Dingjiao" that from the perspective of the anchor, if the brand does not provide a good enough mechanism and does not provide more benefits in the form of customized products, more gifts, etc., it is like being "stabbed in the back" by the brand, and they will definitely express their dissatisfaction to the brand.

However, Crab Card is a special category. It is a futures product and has seasonality. For the brand, the best mechanism will be given to the one with higher sales. At the same time, the singleness of Crab products makes it impossible for the brand to balance the anchors on both sides. In comparison, it can only choose the anchors with whom it tends to cooperate for a longer time.

However, if different anchors set different prices for a brand, it will not only cause dissatisfaction among anchors and consumers, but also reduce its own profit margins. Xu Fang analyzed that at this point in time, if Mrs. Crab does not handle this public opinion crisis well, not only will sales be affected, but in the long run, the aftermath will be immeasurable.

According to media reports, the Mrs. Crab brand was removed from the Suzhou Yangcheng Lake Hairy Crab Association in June this year. According to the official website of the Suzhou Yangcheng Lake Hairy Crab Association, Mrs. Crab had been repeatedly punished by the Market Supervision Administration for "shortweighting" and "false advertising".

Regarding the "delisting", Mrs. Crab's customer service said: "Previously, short weight and false advertising were isolated cases. Now we guarantee the quality. In addition, only a small part of Mrs. Crab's most high-end and expensive products are from Yangcheng Lake. We do not sell Yangcheng Lake hairy crabs in online live broadcast rooms such as Douyin."

At the same time, Mrs. Crab’s main cooperating anchors on Douyin and Kuaishou are Crazy Little Brother Yang, several anchors under the Three Sheep, as well as Simba and his apprentices.

On the evening of September 4, Simba issued a statement that the company's anchors were prohibited from selling hairy crabs this year, and he would not broadcast to sell goods in the near future. Brother Xiao Yang changed to "Su Zhuangyuan" brand crab cards for sale in recent live broadcasts, and the "Crab Wife" gift box was only available on other matrix accounts under the company.

No matter who wins or loses between Simba and Xiao Yangge, the Mrs. Crab brand has become the biggest loser.

02 Behind the hype is traffic anxiety

In this war of words, Simba was the main attacker.

On the evening of September 3, Brother Yang responded in his apprentice Zhuo Shilin's live broadcast room, saying, "I don't want to say anything. There is no point in arguing. There are so many people below. Those who run a good business don't quarrel every day. Brothers, just wait and see." However, Simba started broadcasting on the evening of September 4, "I won't be selling goods tonight. I will only talk about Brother Yang's business."

In this peak season for hairy crabs and mooncakes, why did Simba not promote the products but continue to focus on Xiao Yang? In fact, "quarrel" has always been Simba's familiar traffic code. Before this, he had publicly criticized opponents, brands, and platforms many times.

In the repeated "war of words", Simba achieved at least three goals.

The first is to stabilize his own image. The reason why Simba can "call the shots" in the live broadcast room is because he is "hot-tempered" in the hearts of fans. Specifically, in order to get the lowest price, he is willing to offend brands and publicly criticize brands. He must repeatedly emphasize and maintain his "lowest price" in the minds of fans.

Second, it increases attention. Previously, Kuaishou's traffic ecology was more private, and Simba used to "fight" with many top anchors, then express misunderstandings, and then start a new quarrel to divert traffic to each other, firmly grasping fans in his hands. Over the years, anchors who have publicly quarreled with Simba include Erlu, Fangzhang, etc., and this time Xiao Yangge is just one of them.

But as Kuaishou opened up public domain traffic, this trick gradually became less effective. Simba frequently called on Kuaishou to "not give him traffic" because Kuaishou really didn't want to concentrate the traffic in the hands of big anchors.

Sun Ze, the head of operations at the MCN agency serving the Kuaishou ecosystem, said that Simba may have started cursing in order to boost traffic at a lower cost. Cursing with Xiao Yangge can also attract fans from other sites to convert.

The third is to build momentum for big sales. In recent years, Simba's live broadcasts have become less frequent and the frequency is unstable, but every time there is a big sale, he will try to get on the hot search. Recently, it is the Mid-Autumn Festival and the 99 big sale season, and Double 11 is approaching. According to Xinkuai data statistics, on the first day of Simba's scolding (August 31), the estimated GMV exceeded 180 million yuan, far exceeding the estimated GMV of more than 90 million per game in the past 7 days.

In the live streaming industry, quarreling is equal to speculation. Zhang Lan's live broadcast room still occasionally uses scolding Big S to increase traffic and bring in goods. Xiao Yangge, Li Jiaqi and other top anchors have also scolded brands and opponents in their live broadcast rooms.

Over time, the audience has gradually become familiar with this routine. Some people think that Simba and Xiao Yangge were "ugly" in this verbal battle, while others think that the two are working together to hype it up. "If there are really problems, they can tell each other directly in private. It's annoying to see such a back and forth."

In fact, before this incident, Xiao Yangge and Simba had always shown good interaction in front of the public.

During the 618 period last year, Xiao Yangge had a live broadcast with Simba. During the process, Xiao Yangge repeatedly expressed his respect for Simba, saying, "I have only been in business for more than a year, and Brother Bage (Simba) will always be someone I will learn from."

In the live broadcasts in recent days, Simba recounted that when he first made friends with Brother Xiao Yang, the other party was still a mid-level anchor, and he was invited to Brother Xiao Yang's live broadcast room to give large gifts to show his support. Unexpectedly, Brother Xiao Yang later said in front of others that Xin Youzhi asked him for money.

It is hard to tell whether the grudges are true or false, but the dispute between the two anchors proves one thing, that is, there are no eternal friends in the live streaming industry, only eternal traffic, and the anchors praise or step on each other, and the business is behind it. In the past few days, not only have the related keywords dominated the hot searches for several days, but the number of online users in the apprentices and official matrix live broadcast rooms of both sides has also reached a new high.

Xu Fang reminded that only now, the audience has become tired of this kind of hype. The anchor who sells products is just one of the channels for brand sales. What ultimately determines whether users place an order is the product itself.

03 What’s left in the live streaming industry at the end?

The focus of this war of words is not just crabs, but also exposes the difficulties faced by big anchors in the process of moving from internet celebrities to corporate operations.

Simba hinted in the live broadcast room that Lu Wenqing had been sentenced to probation for false orders. He also hinted that Lu Wenqing and Xiao Yangge teamed up to send a girl to prison (netizens speculated that it was the female anchor Momo who had not been broadcasting for a long time), and listed the products that Xiao Yangge was found to have quality problems, including hair dryers without any quality certificates, "lymph meat" pork with preserved vegetables, and suspected fake Moutai.

On the evening of September 4, Lu Wenqing responded on his account:

1. Regarding the quality and after-sales issues of products such as Meicai Kourou that netizens are concerned about, the company has not received any punishment from any relevant department for the incident, and the company has also refunded the above-mentioned products.
2. Regarding the issue of a certain girl, we have reported it to the police, the public security department has accepted the case, and will resolutely pursue the legal responsibilities of the relevant personnel in accordance with the law.
3. He took some detours before founding Three Sheep, and he respected and accepted all legal judgments, and was deeply alert.

Simba and Xiao Yangge’s transformation paths are quite similar.

Simba has entrepreneurial experience in micro-business and pays more attention to the supply chain. In 2020, he founded Xinxuan, laying out matrix accounts, developing the supply chain, and incubating its own brands. He started earlier than the Three Sheep.

Xiao Yangge is the first amateur anchor on Douyin with over 100 million fans. Since he became famous, he has tried to corporatize and formalize operations as soon as possible. He established Hefei Xiao Yang Zhendao Supply Chain Management Company and launched his own e-commerce "Xiao Yang Zhenxuan". At the same time, he told "diversified stories", laid out TikTok e-commerce, opened a Hong Kong branch, and made short dramas. But in Sun Ze's view, a series of attempts are in the early exploratory stage and have not yet formed a substantial boost to the brand.

The two companies faced similar problems after their corporatization.

In terms of product selection, Wang Hai once "exposed" the "sugar water bird's nest" sold in Simba's live broadcast room, and also "exposed" dozens of products that appeared in Xiao Yangge's live broadcast room for false advertising. The "Mei Cai Kou Rou" brand that Three Sheep once promoted was criticized for using lymphatic meat on March 15 this year.

In terms of corporate governance, the anchor "Red Light Yellow" under Three Sheep was named and reported by the official for his vulgar performance in live streaming. This time, Lu Wenqing's inappropriate remarks in the live broadcast room exposed the management problems of Three Sheep; Guan Qian, the externally hired CEO of Xinxuan Group, was dismissed this year. Before leaving, she staged a "forcing the palace" drama with Simba's apprentice Dandan.

In addition, this method of using verbal abuse to attract traffic is more likely to appear in the early stages of the development of the live streaming e-commerce industry. Now that the industry structure has stabilized and the platforms and anchors have matured, the top anchors of Kuaishou and Douyin are still using such crude and mechanical means to gain traffic. This shows that live streaming e-commerce is still highly competitive and has limited room for growth.

2021Q3-2024Q2 China live e-commerce market transaction scale Source/ Analysys

According to data from Analysys International, in the just-concluded second quarter, the year-on-year growth rate of transaction volume in China's live e-commerce market has dropped to 12.6%, the lowest in the past two years, and the industry's growth rate has slowed down.

At the same time, Analysys International mentioned that "in recent quarters, some platforms have formulated and implemented policies that prioritize traffic and transactions. To achieve immediate results in terms of traffic and transactions, extremely low prices are the most direct measure."

Under such guidance, big anchors may continue to use the "lowest price" as their main advantage, and the competition among anchors for low prices and traffic will also continue.

"It is better to be professional than to fight and kill each other." Many industry insiders said that this war of words should perhaps cause the entire live e-commerce industry to reflect.

In any industry, all dividends will eventually be leveled by competition. At this time, only innovation can create profit space. This sentence also applies to the current live e-commerce industry. The real winners belong to those anchors and merchants who can continue to innovate, develop professionally, and put consumer interests first.

At the request of the interviewees, Xu Fang and Sun Ze are pseudonyms in this article.

Author | Su Qi Editor | Wei Jia