After canceling the pre-sale, is Taotian betting on its future on 618?

This 618, whether it is the simplest one or not, is definitely the most difficult to ignore. After the cancellation of pre-sale, how much can Taotian get in 618?

There are still two weeks until June 18, but e-commerce companies that are busy using mid-year promotions to verify the results of their strategies can't wait. On June 5, Tmall issued a report on the first phase of the campaign, announcing that 368 new brands won the trend category championship. JD.com said that within just 4 hours of the opening, the peak share of JD.com's payment transactions reached a record high. The timing is advanced, the battle line is extended, the discount is simplified, and the pre-sale is cancelled. These are the different directions of e-commerce platforms' efforts when they use the low-price model to sweep consumers. In order to let consumers perceive these changes at the first time, the platforms are embedded in every gap of the Internet, and they can jump by shaking their phones.

This 618, no matter whether it is the simplest 618 to play, is definitely the most difficult to ignore 618.

During this period, Taotian Group, which spent more than a year adjusting its structure and strategy, has frequently appeared on hot searches with activities and policies such as drawing free orders, free shipping in Xinjiang, cancellation of pre-sales, unlimited returns with free shipping, etc., becoming the "conspicuous bag" during the 618 period.

In fact, 618 has never been Tmall's main event, but this year it has made every effort to refresh the sense of participation, which is enough to show that Taobao's anxiety has not been resolved. At present, e-commerce online shopping and instant retail have passed the development blowout period, goods are no longer scarce, and the attractiveness of big promotions is declining year by year. If e-commerce giants like Taobao continue to make efforts in big promotions, how much effect can they achieve?

1. Are discounts and shopping really that simple?

On May 31, the 618 promotional posters, H5s, and short films of major e-commerce platforms were everywhere on the Internet, and it was hard for anyone to completely stay out of this grand mid-year carnival. "This year's 618 coupons lasted a full month from the first wave to the end. Why not just change the name to 518?" At 8 o'clock in the evening, Shen Yuan skillfully emptied the shopping carts on Taobao and JD.com that had been added to carts long ago. Even though he was dissatisfied with the ever-changing activity rules, a large purchase in the middle of the year was still a habit that Shen Yuan had been unable to give up for many years.

Although when making the strategy, Shen Yuan saw many netizens complaining that this year's 618 battle line was too long and the discounts fluctuated too much, but according to Shen Yuan's own observations, the clothing, shoes, pet supplies and other products she purchased in advance were indeed more favorable than the previous prices. Coupled with some coupons or red envelopes randomly issued by the system, it was also a good time to buy.

However, the netizens’ complaints are not without reason. Although Tmall 618 has cancelled the pre-sale mechanism this year and it comes earlier, if you really want to accurately buy the lowest price range of different products, you still need to do some homework.

Puff, the owner of a group called "618 Strategy Group", told Zinc Scale, "This year, Tmall's discount is 300-50, which is more generous than in previous years. It is recommended to go for the first wave of opening, when the price should be the most favorable. Remember to claim the large coupons for 88VIP, and you can also start claiming the money-saving cards three days in advance. Add Taobao coins, super red envelopes and game red envelopes, and you will basically get the best deal."

Puff believes that this year's Tmall's 618 focuses on returning users. Not only has the pre-sale been cancelled, but the discount amount has also been upgraded. The idea of ​​"buy early and get the discount early" should be correct.

This year, Tmall’s 618 promotion is pervasive

Whether it is the promotional means that almost every software can jump to Taobao, or the adjustments from discounts to activity time, it is not difficult to see that Taobao has high expectations for this year's 618. At the same time, it can also be found that Taobao's focus this year is on the old problems that consumers have criticized in the past, such as the pre-sale mechanism with too long waiting period, the lack of sincerity in the full discount, and the difficulty in calculating the correct gameplay.

According to the first and second wave of data released so far, this year's improvements and efforts have indeed paid off. On May 20, in the first hour of Tmall's 618 sales, 28 brands had sales exceeding 100 million yuan, and 216 single products had sales exceeding 10 million yuan; on May 31, the second wave of Tmall's 618 sales started. As of 9 p.m. that night, 185 brands had cumulative sales exceeding 100 million yuan, and 11 brands had cumulative sales exceeding 1 billion yuan. At 9 p.m. on May 31, 185 brands had sales exceeding 100 million yuan on Tmall's 618, more than 37,000 brands had doubled their sales, and 50 trending categories had sales exceeding 1 billion yuan.

Taotian, which started to build a new team and clarify its new direction last year, has finally waited for a big promotion node to show its achievements. However, whether the 618 promotion can bring a long-tail effect to Taotian's future development still needs to be verified over a longer period of time.

2. Revitalize the site and attract users outside the site

Over the past year, Taotian Group has been constantly reviewing itself, and one internal letter after another is full of Taotian's anxiety and expectations. After several rounds of adjustments, on April 3 this year, Alibaba co-founder and chairman of the board of directors, Joseph Tsai, said frankly in an interview: "When we internally review and self-reflect, we know that Alibaba has fallen behind because we have forgotten who our real customers are. Our customers are people who use our APP to shop, and we have not given them the best experience." Therefore, this year's 618, Taotian focused on customer experience and also reawakened consumers' shopping intentions both inside and outside the site.

From the website, as the Tmall 618 with the largest investment, this year's Tmall strategy can be called "comprehensive defeat". In the whole venue, on top of the 50 yuan discount for 300 yuan and the official 15% discount, there are also 15 billion red envelopes; Tmall 88VIP not only upgraded the "unlimited returns and shipping included" rights. It also launched a shopping monthly card for the first time. Consumers can open it for 8.8 yuan in the first month and receive the first batch of 500 yuan large coupons for Tmall 618. Before this, consumers needed to spend 88 yuan to open an annual card to become 88VIP.

With the help of this move, after the launch of Tmall's 618 event, the number of 88VIP member visits increased by more than 40% year-on-year, the number of people placing orders increased by more than 50% year-on-year, and the average purchase amount per person increased by more than 30% year-on-year.

Baidu index of the keyword "618" In addition, Taotian Group's internal staff also revealed to Zinc Scale other directions of this year's 618, such as the return of the 50% discount venue with participation from big brands such as Huawei, Midea, Nike, lululemon, Uniqlo, Alexander Wang, Lancome, Helena Rubinstein, etc. "The 50% discount on the entire site was the main gameplay of Taobao's first Double 11 in 2009." The staff member said, "Taobao invested 10 billion yuan in subsidies and launched 200 big-name 'family buckets' with a discount of 80%. Juhuasuan will have a 'buy one get one free' event for 10,000 big-name popular products, including Huawei mobile phones, B&O headphones, Aux refrigerators and other brand products will participate."

Discounts are one thing, but Taobao's definition of 618 this year is "simple". "This year will be the simplest 618 in history, focusing on simplicity and affordability, and greatly simplifying the promotion from both the user and merchant ends." The above management further said.

As for outside the site, Taobao is working hard to siphon traffic from various platforms. For example, Alimama Taobao Star Task and Juliang Star Map jointly launched the "Star Cube Plan" to improve the efficiency of "TikTok marketing and Taobao transactions". At the same time, it upgraded its cooperation with more than 200 Internet platforms such as Tencent Advertising, Zhihu, and Bilibili to enhance merchants' ability to acquire customers across the entire network.

Since last year, "low price" has become the common focus of major e-commerce platforms. Pinduoduo has continued to provide subsidies worth 10 billion yuan. JD.com founder Liu Qiangdong pointed out that low price is the most important weapon for JD.com's success in the past. One of Taobao's five major strategies for 2023 is price power. The competition over low prices has become more intense during the 618 shopping festival.

This year, Tmall's various measures, both inside and outside the site, are aimed at "circling" consumers in advance and boosting their enthusiasm. However, no change can satisfy everyone, so consumers continue to complain about the overwhelming advertisements, and small and medium-sized businesses complain about the impact on their income caused by the rule changes. However, if we really want to evaluate this subversive promotion mechanism, it seems that we have to be guided by the final results.

3. Big promotions are becoming normalized. What is the attraction?

Consumers’ weakness in the promotion has long been apparent, and e-commerce platforms have long stopped showing off data from the promotion period as a battle report. However, consumer demand has not disappeared, it has just shifted.

According to the 2023 China E-commerce Industry Trends Report released by StarMap Data, Tmall maintained its lead in the market share of comprehensive e-commerce platforms with a share of 46.0%, but its growth slowed down. JD.com ranked second with 27.2%, and Pinduoduo ranked third with 26.8%. In the live broadcast e-commerce market, Douyin e-commerce ranked first, occupying nearly 50% of the market share.

The rapid growth of Pinduoduo and Douyin e-commerce has undoubtedly brought pressure to traditional e-commerce giants such as Tmall and JD.com. The key reason for the former's rapid growth is inseparable from low prices, which is also the reason why all major e-commerce companies must now make a big fuss about low prices.

Source: Star Chart Data

Under this industry trend, the development strategies of various companies have also begun to return to their roots, and the concept of "simplifying the complex and putting users first" has led the platform's pace. The first 618 after the cancellation of pre-sales is a test of the industry and a dividing line for the 618 promotion to enter the 2.0 era. Although low prices are the key to competition at this stage, they are not everything. The experience that goes hand in hand with low prices is equally important. Trying to shorten the consumer's decision-making process can further stimulate transactions.

For example, during the 618 period this year, all major e-commerce platforms have added the "family bucket" gameplay. On the one hand, it solves the problem of consumers' preferential selection when they make orders or combination purchases. On the other hand, it increases the average purchase amount per person, driving an explosion in inventory.

"This year's 618 is a large-scale test, and the test results will become the direction of the future development of each platform." An e-commerce industry practitioner analyzed to Zinc Scale, "But no matter what the result is, the normalization of low prices and large promotions is an irreversible trend."

If we use this perspective to predict, low prices in the e-commerce industry will become the norm in the future, and the presence of big promotions such as 618 and Double 11 will continue to weaken. Only e-commerce platforms that can reasonably mobilize resources from all parties, make targeted subsidies more precise and detailed, and strike a balance between low prices and experience may have the last laugh in this competition that returns to its roots.

Author: Li Jinlin, Editor: Li Wenjie

WeChat public account: Zinc Scale (ID: znkedu)