After Luo Yonghao, can the live broadcast room still become the main battlefield for paying off debts?

Why do more and more entrepreneurs choose to enter the live broadcast room when the company is facing a crisis? This article will show you the reasons, and this article is recommended for companies or individual operators to read.

When companies face a crisis, live streaming becomes their "lifeline", and more and more entrepreneurs are choosing to enter the live streaming room.

At 7 p.m. on July 2, "Story Club", which carries the childhood memories of several generations, entered the live broadcast room. Chairman Xia Yiming's first live broadcast on Taobao received 530,000 views, and the "Story Club 60th Anniversary Commemorative Collector's Edition" sold in the live broadcast room was quickly sold out as soon as it was put on the shelves.

It is worth mentioning that on the eve of 618 this year, Taobao Live officially announced the launch of a fully managed live broadcast service for entrepreneurs. As long as the CEO is interested in endorsing his own company, he can start a live broadcast on Taobao. The project is code-named "CEO who marches forward courageously". With the support of this plan, "Story Club" entered the live broadcast room and gave it a try.

Previously, the most popular live broadcast room of the "Brave CEO" project was Lin Sheng's "Zhong Xue Gao Lao Lin". On June 27, the live broadcast room of "Zhong Xue Gao Lao Lin" suddenly became very popular. In just a few minutes, the number of live broadcast viewers soared from 44,000 to 207,000. Entries related to "Zhong Xue Gao" also quickly became popular on Weibo.

However, this wave of traffic did not bring sales, but rather criticism from netizens.

At around 14:52 on the afternoon of June 27, the anchor "Zhong Xuegao Laolin" suddenly fell to the ground during a live broadcast. For a time, rumors of "sudden death of the female anchor" were everywhere. Netizens questioned whether Zhong Xuegao had exploited the anchor, and a public opinion crisis was looming.

Subsequently, CEO Lin Sheng responded urgently that the anchor had recovered after resting backstage, and had been sent to the hospital for examination.

The anchor later posted a message on WeChat Moments to report that he was safe, saying that it was just due to the rainy weather and lack of oxygen, and clarified that the company did not engage in any "exploitation" behavior.

Fortunately, the host's fainting was just a false alarm. But for Zhong Xuegao, who is carrying a debt of 900 million yuan, is it safe? Can the live broadcast room really become Lin Sheng's home court to pay off his debts?

1. Live broadcasts don’t need fancy stories

At 7pm on May 28, Lin Sheng appeared in the live broadcast room "Zhong Xue Gao Lao Lin" and officially started live streaming. The main product of the first live broadcast was a sweet potato priced at 42.9 yuan for five catties, while five catties of sweet potatoes on supermarket shelves cost only 10 yuan at most.

In addition to sweet potatoes, the live broadcast lasted four to five hours and included a total of 64 items, including some affordable products at 9.9 yuan, such as napkins, hand sanitizer, and toilet water... On the one hand, the selection of products lacks characteristics. Consumers can buy them anywhere, so why come to Zhong Xuegao's live broadcast room? On the other hand, the actual price of daily necessities is not high, and even at a price of 9.9 yuan, it is difficult to have a price advantage.

In addition, the products sold in the first live broadcast of "Zhong Xue Gao Lao Lin" were originally intended to be mainly Zhong Xue Gao, but because the supply chain could not keep up, only some of the products were available for sale.

Lin Sheng’s live streaming debt repayment journey got off to a bad start due to the supply chain not keeping up, lack of differentiation in product selection, and no advantage in “price/performance ratio”.

According to Taobao Live data, the first live broadcast of "Zhong Xue Gao Lao Lin" attracted 842,700 viewers in 24 hours, with only about 1,500 new followers, and the most popular sweet potato sold less than 200 pieces. In comparison, four years ago, Luo Yonghao, the "first person to pay off debts through live broadcast", attracted more than 48 million viewers in just three hours of his first live broadcast, with a total transaction volume of more than 110 million yuan.

The reason why Luo Yonghao can achieve "True Return" is inseparable from his personal IP . The selection of products in the "Make Friends" live broadcast room is mainly based on Luo Yonghao's own personality, that is, digital expert and geek expert, and the selection of products is deeply cultivated in vertical fields such as 3C digital, electrical appliances, and home furnishings. The live broadcast room of "Zhong Xue Gao Lao Lin" is more like a daily necessities grocery store, lacking truly competitive products.

In fact, Lin Sheng also knew that if he wanted to repay his debts through live streaming, the most important thing was to change his reputation and create a new "personality".

The signature of the live broadcast account of "Zhong Xue Gao Lao Lin" is "Make good products, pay off debts, and stay together ." Just as he responded to the comment of "pay back quickly" in the live broadcast room of Wu Xiaobo Channel, "Whether selling ice cream or sweet potatoes, I will pay back the money of employees and suppliers bit by bit, and I will always recognize this account." Choosing to sell sweet potatoes in the first broadcast is also to fulfill this promise. In this way, he shows consumers the image of a responsible entrepreneur to restore consumers' trust.

But in fact, the two major controversial issues of Zhong Xue Gao have not yet been resolved.

First of all, the usual high-price strategy is no longer effective. Since Lin Sheng’s live broadcast, the most talked-about topic among the audience is the transformation of the “ice cream assassin” into the “sweet potato assassin”. Although the act of selling sweet potatoes is “people-friendly”, the price is not attractive. The high price of sweet potatoes undoubtedly deepens consumers’ inherent impression of the brand. In the subconscious of consumers, any product related to Zhong Xue Gao is “grabbing money”.

Zhong Xue Gao has always been an internet celebrity who relies on telling brand stories to achieve premium prices . The market recognition has made Lin Sheng inflated. For him, "cost-effectiveness" is not worth mentioning in front of a gorgeous story. He even asserted: "Historically, no brand that has survived different economic cycles has been cost-effective. I will do my best and stand here, and the living standards of consumers will gradually improve."

However, only four years have passed, and consumers have become more rational, while Zhong Xue Gao is still "standing still." Live streaming does not require fancy stories, and consumers want the "price-performance ratio" of shopping around.

The "2022-2027 China Ice Cream Industry Market Panoramic Survey and Development Prospect Forecast Report" shows that netizens' acceptable price for a single ice cream is mostly 3-5 yuan, accounting for 37%; followed by 5-10 yuan, accounting for 33.9%; the acceptable price is 10-20 yuan, accounting for 16.3%; and the acceptance rate of more than 20 yuan is only 1.8%. The reason is that the Internet celebrity model has failed. Consumers have suffered from high prices for a long time and are unwilling to pay for low cost performance.

Secondly, false propaganda has caused consumers to lose trust. In 2022, the news that "Zhong Xuegao's ice cream did not melt after being placed at room temperature of 31 degrees for 1 hour" suddenly became a hot search. A few days later, netizens discovered that "Zhong Xuegao's ice cream did not melt" and questioned that it added excessive food additives. As soon as the news came out, public opinion was in an uproar. Although Zhong Xuegao has repeatedly responded that it is not scientific to test the quality of ice cream by drying or baking ice cream, its reputation can no longer be saved.

Perhaps, just like the story of “The Boy Who Cried Wolf”, telling too many lies will always backfire.

The advertisement claims "not a drop of water, pure milk fragrance", but in fact, the ingredient list clearly states that it contains drinking water ingredients; it claims "only special red grapes from the core grape-growing area of ​​the Turpan Basin are used", but the ingredients are identified as "bulk/first-class" by the market supervision department; "specially selected Japanese Yabukita tea" was also revealed to be mixed tea...

A "black swan" event not only failed to help Zhong Xue Gao survive the cycle, but also greatly reduced consumers' trust in it.

Since the first day of the broadcast, the background of the live broadcast room of "Zhong Xue Gao Lao Lin" has always been a series of conspicuous numbers, representing the number of employees whose wages were owed by the company. After a month of live broadcast, the number has dropped from the initial "729" to "718" when the female anchor collapsed. It can be said that the effect is very small. The success of live broadcast sales depends on the trust of consumers in the anchor and the product, and Zhong Xue Gao obviously still has a long way to go in this regard.

Telling a good story is the capital market’s eternal “money-making” routine, but for live streaming, it is far from enough.

2. Deep brand cultivation is needed behind traffic

Luo Yonghao made 400 million yuan a year by selling goods through live streaming, and top anchors such as Wei Ya and Li Jiaqi have an annual income of more than 1 billion yuan. According to the e-commerce database of "Dian Shu Bao" of the China Internet Network Information Center, the transaction scale of live streaming e-commerce will reach 4916.8 billion yuan in 2023, a year-on-year increase of 40.48%. Although many people claim that "the bonus period of live streaming has passed", it is an indisputable fact that real money is still pouring into the live streaming room, which is why more and more entrepreneurs are following Luo Yonghao's example and entering the live streaming room.

For entrepreneurs who are in debt, live streaming is the best option to turn things around when they are at their wits' end. Wang Guoan, founder of the beauty brand Hanhou, has also set his sights on live streaming.

On January 10, Wang Guoan appeared in the live broadcast room of Hanhou's Tmall official flagship store. The live broadcast was caused by a luxury house being auctioned off, which then led to debt disputes and rumors of selling the house to repay debts. Faced with the long-lost attention, Wang Guoan naturally could not miss the opportunity and talked about the story of the "300 houses" that the audience was most interested in. But the real purpose was not to drink, he emphasized that "the biggest energy we are spending now is not on dealing with houses, but on how to make the Hanhou brand better."

In the past, Hanhou's success was built on high-profile marketing . On the one hand, it spent a huge amount of money to sign Korean popular stars to consolidate its brand's "Korean Wave" attributes, and on the other hand, it put in a large number of TV advertisements. Hanhou has won the "bid king" of advertisements on ten second-tier satellite TV stations such as Tianjin Satellite TV, Henan Satellite TV, and Jiangxi Satellite TV, as well as the special rights of CCTV Spring Festival Gala and Lantern Festival Gala, and even won the five-year LED hanging network advertising rights of Guangzhou Tower for 200 million yuan.

However, with the rise of live e-commerce, the traditional channel of large-screen advertising in the Internet era has ceased to exist, and Hanhou's past marketing methods have gradually become ineffective. Hanhou, once a national-level beauty brand, disappeared for a time, and young consumers have never even heard of the brand. Compared with domestic beauty brands of the same period, Hanhou's gap is also getting bigger and bigger.

As of now, taking the number of fans of Douyin official flagship store as an example, Perfect Diary has 6.563 million fans, Hansu has 9.07 million fans, Proya has 9.169 million fans, and Hanhou has only 730,000 fans, less than one-tenth. In terms of sales, in the past five years, Hanhou's annual revenue has shrunk from 1.4 billion to 1.5 billion to 400 million to 500 million.

Wang Guoan had to admit that "everyone is right to say that Han Hou is lagging behind."

After realizing the problem, Wang Guoan began to try new strategies and announced that the focus of future transformation would be on live streaming and product research and development.

First of all, for Hanhou, the first step to regain market share is to grab consumers' attention. Wang Guoan placed his hopes on "combining personal influence with the Hanhou brand and deepening traffic."

If live streaming is about taking money, then short videos are about saving money . Use short videos to establish the entrepreneur's personality and brand image. When fans accumulate and then convert them through live streaming, the fan stickiness and live streaming purchase rate are more guaranteed.

Unlike Lin Sheng, who rushed to start broadcasting without a Douyin account and only 14,000 followers on Weibo , Wang Guoan has been focusing on operating his personal short video account since last year. According to media reports, Wang Guoan now carries a small new media team with him. Whether he is sitting down for an interview or walking and chatting, the cameraman never tires of holding up the camera. The team will extract the highlights and post them to the Douyin account of "Hanhou founder Wang Gangan". At present, his Douyin account has more than 155,000 followers and has posted more than 130 short videos.

Unlike Lin Sheng who personally became the anchor, Wang Guoan himself did not stay in the live broadcast room. After all, selling goods is the specialty of anchors, while building brands is the specialty of entrepreneurs . Luo Yonghao, who made a comeback through live broadcasting, also chose to "leave the house after the work is done, hiding his achievements and fame."

Even after Luo Yonghao "left", during the 618 period this year, Jiaogepengyou still added more than 3,000 new cooperative brands year-on-year, sales on all platforms increased by more than 20% year-on-year, and sales in Taobao live broadcast rooms increased by 120% year-on-year. In May this year, Century Sage, a Hong Kong-listed company that has completed the full acquisition of Jiaogepengyou, announced that it plans to change its name to "Jiaogepengyou Holdings Co., Ltd." and its English name will also be changed to "Be Friends Holdings Limited", achieving a curve listing.

It can be seen that brand IP is more lasting than personal IP.

Secondly, Hanhou focuses its R&D efforts on creating hits and empowering traffic to products. At present, Hanhou's technology research and development center has more than 30 independent patents for product ingredients, technologies, and efficacy, and 48 product appearance design patents. In the field of tea research and development, Hanhou has established a high competitive barrier.

Live streaming is just one way to solve the problem. Relying entirely on live streaming to pay off debts is only a temporary solution . Wang Guoan obviously understands this underlying logic better than Lin Sheng: traffic is important, but only by deepening brand and product innovation can we catch the traffic.

3. The courageous CEO rides the wave in the live broadcast room

Not only did the founders of popular brands such as Zhong Xuegao and Hanhou quit, but even the celebrity Wang Xiaofei, who brought his own traffic, chose to "lower his status". Although he failed repeatedly in entrepreneurship, with the traffic "blessing" of his ex-wife, a big star, Wang Xiaofei's live broadcasting journey can be said to be smooth sailing compared to his bumpy entrepreneurial and emotional experiences.

Since the end of 2022, Big S sued Wang Xiaofei for failing to perform the divorce agreement and defaulting on child support. Wang Xiaofei started a crazy bombardment of Big S's family. While the whole network was eating melons, Ma Liu Spicy and Sour Noodles set a record of 50 million in sales in 3 days. From then on, Wang Xiaofei found that as long as he "went crazy" on the Internet, he would bring in tremendous traffic, and the traffic was converted into sales.

Just "exploiting the ex-wife" will sooner or later make the spectators bored. Having tasted the sweetness of live streaming, Wang Xiaofei began to constantly create new roles and topics, and the new "Taiwanese wife" also continued to output new gossip.

Even the nanny hired by Wang Xiaofei to take care of Xiao Yue'er started live streaming her "rich life".

Having gossip attributes is equivalent to having traffic. Li Guoqing, who has nothing, can't rely on "going crazy". He can only ask jealously: "Zhang Lan lost her career, Wang Xiaofei lost his marriage, I have both, why don't I have millions of fans every day?"

It can be seen that for frustrated entrepreneurs, live streaming is a shortcut to wealth . If you don't take the shortcut, you'd be a fool. Live streaming, as a more efficient sales model, provides entrepreneurs with new possibilities. In the face of crisis, entrepreneurs stepping forward to become Internet celebrities is also an act of active self-help.

Nowadays, the live broadcast industry is booming, and everyone wants to get a piece of the pie, and the competition will only become more intense. For companies that want to save themselves, obtaining traffic is crucial. How to build a supply chain, carefully select products, and manage brands is even more worthwhile. After all, traffic can only help brands complete the early accumulation. In the end, if you want to develop in the long run, products are still king.

Author: He Yun

Source: WeChat public account "剁椒spicy" (ID: 1092841)

This article is authorized by @剁椒spicy to be published on Operation Party. Any reproduction without permission is prohibited.

The title image is from Unsplash, based on the CC0 agreement