How to make more money from TikTok? Remember these 12 words

Making money on Douyin is no longer as easy as before. How can you do it? This article summarizes "acquiring new customers in the public domain and making money by retaining customers in the private domain". You can learn more about it through this article.

Is it difficult to make money on TikTok? It must be 100 times more difficult than before.

Doing business on Douyin today is very similar to Taobao 10 years ago: high customer acquisition costs, severe internal competition, low profits for merchants, or even no money at all.

Unfortunately, the users are all on it, and you have no choice but to do it.

In fact, veterans in traditional e-commerce are well aware of this result, which is inevitable.

There is no most expensive, only more expensive; there is no most curvy, only more curvy.

But the question is, what should we do? We have to make Douyin, so how can we make money from Douyin, and make more money?

The answer is the 12 words I will talk about later.

In fact, some people have already been doing it secretly, but more people don’t know about it yet, or are hesitating, like a frog in boiling water.

01

The reason I wrote this topic was because of a message from a friend a few days ago.

In the middle of the night, he left me a message, which roughly said:

They now spend 2 million yuan per month on advertising on Dou Yin, with an ROI of around 2.3, which is not a loss (their product gross profit is relatively high). However, many companies around us spend tens of millions or even hundreds of millions of yuan on buying traffic, which is all one-time exposure, with an ROI of 1-5.

If the gross profit is not high, then Douyin is just a loss-making business. (At the end of last year, a Douyin service provider friend of mine said frankly that their live broadcast room is all paid, and now the ROI must reach 6 to break even)

He believes that if the traffic can be transferred from Douyin to the private domain for secondary monetization (repeat purchase), it will be a low-cost, high-ROI project for the company.

Indeed, for the company, the cost of this batch of traffic has already been paid in the advertising ROI. If it can be monetized again in the private domain, the profit will be very high.

He plans to run the model first, then replicate and enlarge it. It is so difficult to make money now. It is painful to invest millions of dollars in advertising every month. As the person in charge of the business, the money spent must be earned back by yourself in the end. It is better to spend less money and create more "no-cost" sales.

After reading his idea, I especially support him to do this. Then I thought, isn’t this the logic that I talk to companies about doing private domain and consumer operations every day?

It seems that if you want to make more money on Douyin today, the step of moving from the public domain to the private domain is a must.

02

In fact, this friend’s idea is not new.

This is exactly the same dilemma as the logic of "using WeChat to support Taobao" that I talked about in 2016. Therefore, the situation where Douyin merchants guide private domain secondary purchases can also be called "using private domain to support Douyin".

Today, merchants doing business on any platform will actually face such a dilemma, which requires sobriety and vigilance, that is:

Merchants need to make money and make profits, and platforms also need to make money (collect advertising fees, and the advertising GMV needs to increase every year). If both merchants and platforms win, they will have to ask users for more money, resulting in price increases for products, or no discounts.

But the reality is: once the price is raised or there is no discount, there is no price advantage. Competition is so fierce and users have many choices, so they will not buy or buy from other brands. At this time, the merchant has no sales and cannot survive.

Merchants often cannot afford to offend platforms and users. What should they do? Merchants can only spend advertising fees and still sell at a loss. However, after users buy, they return to the platform, and the next time the merchant has to spend money to buy exposure. Therefore, every transaction on the platform has a cost, and it is getting higher and higher.

The platform keeps making money by investing in advertising, but it is difficult for the companies to survive.

The platform is a meat grinder, and the merchants are a piece of meat. If you are killed, you are dead. Anyway, it doesn’t need you.

Users don’t need you as a merchant.

But the boss wants to survive and make money. If merchants want to get out of this dilemma, they must break something or look at the problem from a different perspective. You can't just do business with a user once after getting him from the platform. If you can do two more transactions, you can make money.

So the key here is how to add Douyin users to the private domain pool and how to make them repurchase.

Having experienced Taobao e-commerce, people in Douyin e-commerce today should be able to see through it and understand it.

If you play by the platform’s rules for a long time, you will only become more and more trapped and exhausted. Without your own brand and users, you will be finished in the end.

So to break this game, this situation, there are actually two ways:

One is to flip the table and say, "I don't want to play with you anymore. I have my own channels, brand power, and user base." This is what big companies do.

The other is to openly build a plank road before secretly attacking Chencang. This is suitable for all business brands. To put it bluntly, it means that while eating from the pot, you must also take care of the bowl, which means " attract new customers in the public domain and retain customers in the private domain to make money."

Therefore, users are the most important variables in merchants and platform games.

Remember these 12 words, and you can build your own private domain like Goujian, the King of Yue, who slept on firewood and tasted gall. Slowly accumulate, and once you have your own user pool and brand power, you can also turn the table over. It is better not to turn the table over, and win-win cooperation.

In fact, such dilemmas are similar and appear over and over again. This is the truth, and I will tell you for those who understand.

03

Attract new customers in the public domain and make money by retaining them in the private domain

This was the core of what I taught merchants in 2016 about "using WeChat (xin) to support Taobao (bao). Later, a group of sellers did so and are still making a lot of money.

In 2018, I proposed the "Private Domain Operation Methodology", and many people came to study it systematically. From Taobao e-commerce to Douyin e-commerce and mini program e-commerce, they all remembered this sentence - "Public domain to attract new customers, private domain to retain customers and make money". Last year, a student from 2106 thanked me because my class focused on private domain. Last year, his peers all went out of business, but they were still able to grow and make profits. They were really lucky.

This statement is not only made by Taobao merchants. Since 2018, some big brands have also realized the trend and started to pay attention to private domains.

I remember doing private domain consulting for a company with annual sales of several billion in 2018. Their COO bluntly asked why they wanted to do private domain now, because the advertising fee on TB doubled this year during Double 11, but the sales volume did not double, and the ROI was getting lower and lower. They were a little worried, so the company decided to build its own traffic pool, create a membership system, and have its own users.

The core behind this is also the 12 words: "Attract new customers in the public domain, and make money in the private domain." For any brand, the biggest profit often comes from high-quality users. Those who enter the private domain are a group of high-value users.

When I received the project, I took my team to the stores to conduct research, help them build a closed loop for private domain business, organizational structure, operational processes and standards, and finally provided guidance and support to achieve sales results.

I remember when the private domain generated its first sale, we were all very excited. The COO ran to the project office and sent a big red envelope in the group to celebrate. Later, when their team had operational capabilities, our project team withdrew.

They were considered one of the earliest companies with foresight at the time, and in fact, it was only after they encountered the pain of business development that they realized the necessity of private domain.

After 6 years, in addition to traditional e-commerce platforms, there are now interest e-commerce and live streaming e-commerce platforms. In fact, no matter what era, the respective interests of merchants, platforms, and users have not changed. Merchants always want to make more money and have more profits.

At this time, we cannot rely on any platform. Even alliances are only a phased need. Only by holding users in our own hands can we have the initiative, and this will never change.

This year, I provided [private domain consulting and coaching] to the user operation team of a listed company. During a research interview with their general manager, he said that the cost of acquiring customers on DY was as high as more than 500 yuan, which was too high, and the profit of this product was eaten up by advertising fees.

He thought, we can spend money once, but in the long run, we must retain users in the pool and make purchases in our own mall. At that time, he would be willing to give users a part of the 500 yuan as benefits, which would also improve user satisfaction.

This idea is very practical and simple, and because everyone has the same concept, we quickly reached a cooperation agreement.

This private domain project was officially launched this year. I also led their team to break down the private domain goals, break them down into various operational indicators, and formulate a phased work plan. At this time, everyone will unanimously feel that, well, they have the confidence to complete it.

This company is in a very good state. The boss has ideas, the team has willingness, the consultants have methods, and everyone has confidence. As long as the execution is in place, the final result will definitely not be too bad.

Finally, back to the topic of "How to make more money from TikTok?", the answer is actually self-evident and very clear.

Just remember these 12 words: attract new customers in the public domain and retain customers in the private domain to make money.

Get started, the sooner the better.

Author: Yan Tao

Source: WeChat public account "Yan Tao Sanshou (ID: yantao-219)"