Traffic + subsidies + global coverage: why does Douyin e-commerce attach so much importance to "key promotion products"

This year, consumers' demands have begun to change, and products with good quality and good prices have become their first choice. The entire e-commerce industry is ushering in new changes. Currently, the rising star in the e-commerce industry, Douyin, pays more attention to the "high quality" of products. Can we see the development path of major e-commerce companies from this?

Every year on June 18th, there is something interesting to watch.

During the 618 shopping festival in 2020, live streaming e-commerce was in full swing, and "e-commerce" has since had new connotations and gameplay.

This year, Douyin e-commerce, which has become a new force in the industry with short videos and live broadcasts, has gradually penetrated into the new scenes of "shelves" and "all domains". At the same time, the entire e-commerce industry is also ushering in new changes.

The new changes are reflected in consumers' clear demand for high-quality and low-priced goods. After years of being baptized by various innovative models, today's consumers are gradually becoming desensitized to the complicated routines, and they are more inclined to spend real money on platforms that can provide them with high-quality and low-priced goods.

So you will observe that this year on 618, each platform is returning to "good things" and "value for money" in its own way.

Specifically for Douyin e-commerce, "goods" is the key word to understanding the current focus of the platform.

Data shows that the payment GMV of Douyin 618 Good Goods Festival increased by 70% compared with the same period of last year. The average daily payment GMV of key promotional products increased by 208% compared with the normal period, and the total exposure of Douyin Mall products increased by 102% compared with the same period of last year's Double 11.

"Goods" is one of the current focuses of Douyin e-commerce. As early as the investment promotion stage, Douyin e-commerce made a detailed introduction to the support measures for key goods.

Earlier, the platform also emphasized "good products", "shelves" and "product lists" to pave the way for the subsequent efforts on "products". The "key products for big promotion" gameplay of this 618 is a concrete manifestation of Douyin's investment and determination in e-commerce.

1. When “goods” come to the center

The first question to be clarified is: What are the "key promotion products" of Douyin e-commerce during the 618 event? What kind of support will Douyin e-commerce provide for the "key promotion products"?

It is understood that when Douyin e-commerce determines the "key products for big promotions", it will mainly refer to the comprehensive performance of the product's transaction, user, and service indicators, and then select the key products that meet the requirements of the big promotion activities.

This idea is consistent with the three key words of high-quality merchants that the platform previously emphasized (good products, good content, and good service).

"Shen Xiang" mentioned in the article "Regarding Douyin e-commerce, what other incremental growth can be obtained?": The starting point of the Douyin e-commerce mechanism change and support logic is ultimately to match consumer demand.

The current consumer market is calling for products with “high quality and good prices”. During this 618, Douyin e-commerce also responded through the “big promotion of key products” gameplay.

Specifically, for "key products for big promotions", Douyin E-commerce will provide support from multiple dimensions including "0 slot fees", traffic rewards, price subsidies, and global exposure.

"0 booth fee" means that "key products for big promotions" can participate in platform activities for free; traffic rewards cover mall exposure and search recommendations, selected alliance recommendations and expert cooperation, as well as market promotion and advertising resource support; price subsidies include "super value purchase" subsidies and interest-free installment payments, etc.; full-area exposure allows "key products for big promotions" to occupy golden "booths" in positions such as "super value purchases", the main venue of the big promotion, and the gold list of big promotion hot-selling products.

These support measures are quite comprehensive. Douyin e-commerce has given the current high-quality resources to "key promotion products". Whether from the perspective of the platform's direction or from the perspective of user perception, "key promotion products" are the top priority of Douyin e-commerce's 618 promotion.

Anyone familiar with the development process of Douyin's e-commerce knows that in 2022, Douyin's e-commerce was upgraded to "all-domain interest e-commerce", and this year it launched the "all-domain integrated flywheel growth" business orientation.

For merchants, the "global scenarios" created by the combination of content and shelves will bring a series of new opportunities. In each "global scenario", malls and search are the key sources of growth.

According to data disclosed by the platform at the Douyin E-commerce Ecosystem Conference in May this year, the platform's GMV has increased by more than 80% in the past year, with the mall GMV increasing by 277% year-on-year and the e-commerce search GMV increasing by 159% year-on-year.

In the "mall", "super value purchase" is one of the core mall marketing channels, with strong platform resources and strong user awareness, and significant incremental significance. During this 618, Douyin Mall Super Value Purchase payment GMV increased by 405% compared with the same period of 618 last year.

From the user's perspective, the value of "key promotion items" can also be clearly understood.

Both inside and outside the terminal, activities related to "key promotion products" will reach users through information flow, media dissemination, expert cooperation, etc., and these stimulated interests will be taken over by the mall and search.

The "Great Value Shopping" atmosphere, the "Great Value Zone" during the search process, the presentation of the 618 Gold List, and the platform price subsidies, a series of resources will facilitate user conversion and make the "big sale key products" the best-selling products of the big sale.

From exposure and traffic to transaction conversion, Douyin e-commerce has allocated traffic, subsidies, and global resources to "key promotional products", placing "products" in a higher position.

Behind this series of initiatives lies Douyin e-commerce’s determination to provide “good products” to the consumer market and the possibility for merchants to capture “new growth” on it.

2. Who will capture the “new growth” first?

Since 2022, Douyin e-commerce has been constantly emphasizing the opportunities from "shelves" and "content + shelves".

"Products" are the core of the shelf market and the key factor for opportunities to turn into growth. The "Big Promotion of Key Products" event on June 18 has given merchants a new path to capture new growth based on "products".

The so-called new path refers to merchants using the energy of big promotions to promote core products, thereby driving the overall growth of the brand on the platform.

The logic of this path is: today's consumers are becoming more and more pragmatic. They get to know and fall in love with a brand not necessarily because they are impressed by the brand story, but because a specific product brings a real and excellent experience.

Douyin e-commerce is a suitable choice for brand merchants to implement this new path.

This is because Douyin e-commerce's "global" capabilities combine content and shelves. Brand merchants can list their core products, which can not only use content to amplify the characteristics of the products, but also smoothly convert traffic into sales, achieving the effect of "leading the whole with the point".

According to "Shen Xiang", brands of different categories such as La Mer, Tineco, Xiaomi, Shifenla, Wuliangye, Jiaoxia, YaYa, Huawei, Gu Jiajia Furniture, Adidas, etc. have all participated in the Douyin e-commerce "Big Promotion Key Products" event. These brands have either invested in their own core products or new products, or arranged spot stocks for popular products to fully cooperate with the rhythm of the platform.

The "big promotion of key products" gameplay also proves its strong driving ability for "products".

For example, Tineco’s new product, the Fuwan 2.0PROLED, a newly upgraded smart floor scrubber, saw an average daily payment GMV increase of 360% during the event.

Xiaomi's new product Redmi K60, Gu Jiajia Furniture's versatile player living room sofa, and Shifen Spicy River Snail Noodles have also achieved daily average payment GMV growth several times that of the same period last year.

Products such as La Mer's luxury indulgence set and Wuliangye's 1618 strong-flavor liquor have achieved explosive growth.

It’s important to note that this isn’t a “miracle through sheer force” or “big gamble” type of victory.

Although the industry today is aware of how important "price-performance ratio" is, brand merchants have their own channels and pricing systems that need to be maintained, and "lowering prices for volume" is not a good option.

The root cause of the explosion of "key promotion products" is that the products provided by merchants are of high quality and reasonable prices, which is the product of the combination of emotional courage and rational and meticulous operation.

Considering the importance of new products and "top-notch products" to the brand, merchants need to think outside the box when putting such products into the "big sale key products" gameplay, and realize that "big sale key products" will amplify rather than dilute the value of good products.

On this basis, merchants also need to conduct multiple rounds of price control during the promotion process and combine it with platform subsidies to ensure that product prices are attractive enough in an environment where price comparisons are made on multiple platforms.

The support of platform resources allows merchants to get returns on their investment. As mentioned above, Douyin e-commerce has introduced traffic, subsidies, and global resources into "key promotion products", and the "fuel" of each link is driving the final sales growth.

"Certainty" and "outbreak", two seemingly contradictory words, have been unified because of the two-way efforts of merchants and platforms.

What is indispensable behind this is the seamless cooperation between the platform and the merchants. The gameplay of "Big Promotion Key Products" is not a traditional price reduction promotion, nor is it a routine that remains in the concept. Only when the platform communicates well with the merchants in every link of product registration, price communication, and logistics services, can the brand truly dispel doubts and embrace new opportunities from Douyin e-commerce.

Judging from the final results, the efforts of the platform and merchants have been validated, and a "win-win-win" situation has been formed.

According to the information disclosed at the 2023 Douyin E-commerce Ecosystem Conference, the GMV of the shelf scene accounts for more than 30% of the platform's GMV, and there is still more room for growth in the future.

The further development of Douyin e-commerce requires more "goods" to enrich the "shelves", and the platform's satisfaction of user needs requires continued support from "good products".

For brand merchants, making core products the "key items for big promotions" not only corresponds to new possibilities of "leading by example", but also brings about tangible growth in indicators.

Nowadays, big sales have become the "standard" in the industry and competition is fierce. Douyin e-commerce's "big sales of key products" gameplay provides a more certain path to explosion.

What’s important is that brands don’t need to pay high marketing costs to achieve such growth; the focus is on improving their “product” capabilities.

For example, prepare sufficient inventory during the promotion period, set the lowest price on the entire network, explain key products in the live broadcast, take on traffic, and optimize product information to make it easier to search and sell.

3. Finally

A sustainable business model is always a win-win for all parties, rather than "you take, I give, you have more, I have less". The "key promotion products" gameplay enriches the "shelf" field of Douyin e-commerce and also allows brand merchants to gain growth from the promotion.

The live broadcasts and activities jointly invested by platforms and merchants also meet the needs of users who want to learn about and buy "good products". The participation and feedback from users will further amplify the value of the "big promotion key products" gameplay.

During almost every major promotion, the industry will have discussions on how to break the ceiling.

But this does not mean that brand merchants can only "passively respond" to big sales. As a key node that gathers national consumer energy, there is still room for big sales to take the initiative.

For brands that are or hope to develop in-depth in Douyin e-commerce, "goods" is such a space, and the "big promotion key goods" gameplay is an opportunity that all brands should seize.

Existing cases have proven that paying attention to the "key products for big promotions", cooperating with the platform's development rhythm, making one's own products the key products, and achieving "certain explosion" with the platform's big promotions is a new path that is worth investing in and has rich returns.

Author: He Wen

Source public account: Deep Sound, Global Vision, Value Perspective