Q1 financial report reveals the “wolf nature” of video accounts: user time increased by 80%, and merchants entered the market on a large scale

This article specifically introduces the current situation of WeChat Video Account from three aspects. If you are also interested in WeChat Video Account e-commerce, let’s take a look~

Looking for profits on video accounts has become a new consensus among businesses in 2024.

The video account designated by Ma Huateng as "the hope of the whole audience" will still have a steep growth curve in 2024.

Tencent’s just-released financial report shows that in the first quarter of this year, the total usage time of video accounts by users increased by more than 80% year-on-year.

With the high growth of users, the pace of video account e-commerce has become more "wolfish", with efforts made on both the content and product sides - "by expanding product categories and encouraging more creators to participate in live streaming sales, the live streaming sales ecosystem of video accounts has been strengthened."

In addition, "Financial Story Collection" found that WeChat is undergoing grayscale testing and has arranged a prime position for the entrance to the video account order center in the "My" tab bar at the bottom of the APP.

At a time when major e-commerce platforms are facing internal competition, Video Accounts are accelerating their deployment. It came late but at the right time.

At present, the growth rate of leading e-commerce platforms has slowed down. Douyin officially revealed that in 2023, Douyin's e-commerce GMV will grow by 80% year-on-year, but according to late reports, its growth target for 2024 has been lowered to 36%. According to data from the China Internet Network Information Center, the year-on-year growth rate of Taobao Live GMV in 2023 will drop from 54% in 2022 to 27%.

Merchants and brands in this situation are inevitably caught up in the extreme internal competition. Not only is it becoming increasingly difficult to increase revenue, but profitability is also being hit by the "trend" of lowest prices and only refunds.

Looking for new growth has become a consensus among e-commerce people, and video accounts, which are experiencing strong growth momentum and are not so inward-looking, have become the "land of hope."

WeChat Open Class shows that the GMV of video accounts in 2023 increased three times year-on-year. According to iResearch data, the year-on-year growth rate of domestic live e-commerce GMV during the same period was 35% - the growth rate of video accounts was nearly 9 times that of the overall market.

Some small businesses directly withdrew from the original battlefield. One of them is Zhang Yue, a skin care merchant who has opened a Douyin store for three years and has gone all in on video accounts . After the March 8th holiday this year, she closed her Douyin store and switched to Video Account. "Douyin is not making money this year, but Video Account has incremental users, and both traffic and conversions have dividends."

More businesses are choosing to expand into multiple platforms to supplement their video account platforms . For example, Jiao Ge Pengyou, which has already started business on Douyin, Taobao, and JD.com, began testing video account live streaming on April 23.

In fact, in recent years, the wave of video accounts entering the market has continued. "Financial Story Collection" mentioned it in an article in November last year titled "Video Accounts Behind the Financial Reports: Merchant Migration is Quietly Occurring to Seize the Commercialization 2.0 Dividends". However, with the changes in the e-commerce environment and the evolution of video accounts, merchants now have a deeper understanding of the value of video accounts and a stronger consensus on entry.

In the view of Gong Haihan, CEO of Baizhun, a video account marketing technology company , merchants no longer regard video accounts as a temporary bonus wave, but gradually regard them as the basic foundation of live e-commerce, that is, a must-have option alongside Douyin, Taobao and Kuaishou. "Merchants have a clear distinction between video accounts and other platforms. If they purely pursue GMV scale and short-term explosion, they can go to Douyin. If they care more about profits and pursue long-term brand operation, they will entrust the mission to video accounts and WeChat."

In short, video accounts are entering the vision of more people.

01 New rich are pouring in at an accelerated pace, and “old money” is increasing investment

Brands are becoming the main force in the layout of video accounts.

One of them is Miniso, which started offline. Although the contribution of video accounts to its GMV is still small, it has gathered a group of core users with the highest stickiness and the strongest spending power.

Wei Xiaoya, user operations director of MINISO, told Financial Story Collection that 60% of the brand's video account users have upgraded to high-value gold card members, and the average order value of video account users is nearly three times that of users from other channels. In 2023, MINISO combined user precision marketing strategies, and the number of products repurchased by video account users increased by 20% compared to 2022.

Not only Miniso, according to WeChat Open Class, the number of video account brand merchants and GMV will both increase by more than 200% in 2023.

In 2024, the trend of brand entry will continue to strengthen . According to WeMall, the official operating service provider of video account live broadcast, the entry of big brands, especially traditional brands, is accelerating this year, covering many industries such as apparel and beauty, food and fast-moving consumer goods, and health.

The video account service provider Zero One Digital Technology has noticed that recently, some cutting-edge brands such as the women's clothing brand Ono Kazuko and the men's clothing brand Mr. Bu are currently or planning to launch broadcasts on the video accounts.

In addition to brand merchants, white-label merchants, source factories, etc. are also entering the market on a large scale, and the categories of video accounts are becoming more diverse. WeChat Open Class revealed that the supply of goods brought by video accounts increased by 300% in 2023.

Lin Shen, partner of Taichuan E-commerce and senior operator of Video Account, told "Financial Story Collection" that there will always be new merchants and new categories emerging on a large scale on Video Account, such as the green plants and Xiangyunsha that emerged last year. Recently, he has seen many small merchants selling seasonal fruits and factories selling functional products such as foldable ladders. "They are often very popular in the short term, with a single live broadcast maintaining 200,000 to 300,000 views for a month, and the monthly GMV can reach around 10 million yuan."

It is worth mentioning that there may be differences in the mentality of brand merchants and small and medium-sized merchants in deploying video accounts. Generally speaking, small and medium-sized merchants pay more attention to the positive profit feedback brought about by the video accounts due to their non-volume nature, while brands care more about the scale increase brought by the video account dividends and the long-term operating value brought by private domain maintenance. Of course, this is not absolute. For example, the high-end women's clothing brand Langzi also attaches more importance to the profit growth of video accounts this year.

Based on differences in product categories or scale, different merchants have different ways of entering the video account.

Dual live broadcast on "Douyin and Video Account" or triple live broadcast on "Douyin, Taobao, and Video Account" is the choice of some small and medium-sized businesses , such as some Douyin businesses that sell face masks and body shaping underwear. The advantage of this model is that the trial cost is low. In the initial stage, there is no need to arrange a separate team and cargo tray for the video account. You can wait until the video account shows its potential before increasing investment.

Some businesses also "avoid" self-broadcasting and adopt the distribution through influencers . For example, in March this year, Evelon, a skincare brand under Yatsen E-Commerce, teamed up with influencer "Liyou Mama Circle" to launch its first live broadcast on the video account.

Zilu, head of the video account business unit of Zero One Digital Technology, told "Financial Story Collection" that whether merchants prioritize self-broadcasting or Dabroadcasting depends on the match between their target users and the video account population, which determines the efficiency of their self-broadcasting. “The transaction efficiency of self-broadcasting for categories such as food and beauty may not be as good as that of shoes and apparel in the short term. It is more suitable for them to find influencers to promote the products first, and at the same time cooperate with private domain operations to promote repeat purchases. After the platform has accumulated enough target population labels, they will have better opportunities when doing self-broadcasting.”

In addition to selling goods and realizing cash flow, some businesses are more interested in the ability of WeChat’s social ecosystem to break through the circle of communication and choose to use the video account as a brand promotion platform first. According to Gong Haihan, this year many leading Internet companies are considering transferring 30%-40% of Douyin's brand promotion budget to Video Account.

While new players are pouring in, old players who have entered the market before are also continuing to increase their investment in video accounts.

Increasing the account matrix is ​​the plan of many businesses this year. Zilu noticed that in the first half of this year, brands such as Anta, Skechers, and Fila all opened new accounts.

The same is true for Langzi, a high-end women's clothing brand that entered the video account in 2020. This year, it added a new key live broadcast room, "Langzi Clothing Flagship Store". The new live broadcast room will pay more attention to the conversion of goods to further drive GMV growth.

In addition, some businesses have increased their traffic investment this year . A mid-to-high-end clothing brand increased its traffic investment ratio in March this year to attract more public domain traffic. Its traffic investment GMV ratio increased from 40% last year to 60% at present.

The phenomenon of merchants increasing their investment is also something that the video account data analysis platform Baizhun Data has a deep understanding of.

Gong Haihan said that since March this year, the number of registered merchants of Baizhun Data has increased by 30% year-on-year. "Most of them are merchants who have already achieved success on the video account. Registering for this service also means that they can further deepen their operations on the video account."

In addition to merchants, experts are also pouring into video accounts on a large scale. According to Yibang Power, the number of video account experts increased fivefold in 2023.

Among them, there are both native video account experts who are being cultivated, and many Douyin and Kuaishou experts who come to open up new positions.

The switching of external talents is closely related to official incentives. In April this year, Video Account launched the "Butterfly Plan" to encourage more external experts to join Video Account live broadcast and provide relevant incentives for its cold start.

At present, there are many experts who have shifted their focus to video accounts. Lin Shen noticed that after a Douyin influencer with millions of fans joined the video account this year, his live broadcast frequency has exceeded that of Douyin. In the past week, he only had one live broadcast on Douyin, while at least four on the video account.

In general, the video account in 2024 has already been flooded with people.

02 Video accounts make up for the "infrastructure", and businesses invest in traffic to increase