The most competitive 618 shopping event in history: from low prices to AI, new and old players are competing against each other

As the overall environment gradually recovers, the first pre-sale battle of 618 this year has already started! Many platforms have begun to exert their own strengths - price, content, and AI. In this article, let us focus on the price war and content competition of this 618.

This year's 618 pre-sale has already started. Judging from the discounts and gameplay that have been launched, the competition this year can be described as "fierce". JD.com and Taobao Tmall both shouted the slogan of "the strongest 618 in history". Content platforms such as Douyin, Kuaishou and Xiaohongshu began to learn from the various gameplays of traditional e-commerce platforms. For a time, shelf e-commerce and content e-commerce began to "copy each other's homework" and stepped up their efforts to participate in this melee.

As the overall environment gradually recovers, major platforms seem to have great confidence in 618 in 2023, and have released different policies and signals. These signals focus on the discount intensity during the promotion period and the impact of content on conversion. Judging from the pre-sale situation, price wars and content competition are indeed the most intense battlefields for 618 this year.

1. Coupon price: Bigger discounts and more complicated gameplay

According to Crawley's observation, almost every e-commerce platform held a conference on the 618 subsidy policy before the pre-sale, and even put forward slogans such as "far exceeding previous investments", "will be the 618 with the largest investment in the entire industry", and "historic-level huge investment".

On the consumer side, attracting attention and conversion through discounts and price cuts has become a basic operation of each platform. For example, according to consumers’ calculations, the discount rules of Taobao, Xiaohongshu and Douyin are equivalent to a 13% discount, while Kuaishou is about 15% off. JD.com, on the basis of “direct price reduction”, issues users a subsidy coupon of “20 yuan off for purchases over 200 yuan”, which is equivalent to a 10% discount on the discount.

In addition to these regular promotional activities, major platforms have also launched their own special mechanisms, causing 618 to fall into a fierce price competition.

Mu Shan, general manager of Taotian Group's marketing department, summarized the three key words for this year's 618 in terms of users, namely, good products and good prices, Taobao Good Price Festival, and short videos and live broadcasts that are good to look at and enjoy. Among them, good products and good prices and Taobao Good Product Festival are price strategies launched for consumers. During the 618 period, the lowest price and the same low-priced products on the entire network will be given priority display and recommendation on the search side of Taobao and Tmall. At the same time, Taobao's 10 billion subsidies will provide subsidies for 10,000 brand products every day, and launch the service commitment of low prices on the entire network and compensation for overpriced purchases.

JD.com, a veteran "contestant" of the 618 shopping festival, directly used price as the slogan of this 618 shopping festival. On May 22, at the launch conference of JD.com's 618 shopping festival with the theme of "fast, good, economical and exciting", Xin Lijun, CEO of JD.com Retail, summarized "you will have friends only if you know how to make concessions" as the theme of this year's JD.com 618 shopping festival. During the event, several special days were held in turn, including a good start, a 10 billion subsidy day, a super flash sale day, a super live broadcast day, a special session, and a carnival day for 10,000 stores. A variety of welfare benefits were also proposed, including a limited-time 50% discount and interest-free white slips.

It is worth mentioning that, under the influence of the consumption upgrade, JD.com changed its original strategy of "more, faster, better, and cheaper" to "only for quality life", and was relatively restrained in the price discounts on the platform, selectively giving up some low-price customer groups. However, as the overall environment went down, JD.com reiterated "more, faster, better, and cheaper" last year, and put the entrance to the special sale of low-priced goods on the platform homepage, starting a new round of low-price reforms from the upstream supply chain to the downstream market. This year's 618 has a sense of acceptance of the results of the reform.

Among content e-commerce platforms, Kuaishou was the first to rush into pre-sales. Kuaishou e-commerce also made bold moves in subsidies, launching two core methods: big subsidies for big brands in live broadcast rooms and pre-sales of goods. The pre-sale period offers a discount of up to 30% for the deposit and final payment. However, Kuaishou’s definition of subsidies and discounts is not just low prices. Cheng Yixiao once said at the Kuaishou Gravity Conference: "The low price we are talking about is not an absolute low price like 9.9, but a relatively low price while ensuring quality."

In addition, Douyin e-commerce launched special gameplays during the 618 period, such as deposit pre-sale, cross-store discounts, brand mixed capital newcomer gifts, and selected alliance 618 product selection specials. From crowd accumulation in the early stage of 618, pre-sale circle to conversion and transaction, a complete closed loop of the "pan-shelf" e-commerce model was formed, which complemented its own content conversion advantages.

There are more discounts and they are more generous, but for consumers, if they want to get the biggest discount, they have to take a "math test."

On Xiaohongshu, a user shared his own 618 strategy: "Assume that the total original price of the shopping cart items is Y, and the final price is X, then X=Y-cross-store discounts-consumption coupons-store membership coupons/pre-sale coupons-category coupons-live broadcast room discounts. Note that Y should be an integer multiple of 300..." There was even a user who handwrote a three-page tutorial on how to participate in the 618 event.

Ultimately, the core purpose of the platform's preferential policies is to seize consumers' low-price mindsets and hope to achieve a sales explosion at a specific node through lower prices, which is a good thing for both consumers and platforms. However, the complex subsidy policies and store activities are intertwined, which also makes the cost of consumer participation very high. Perhaps it would be more conducive to users making consumption decisions by simplifying the participation methods of preferential policies while ensuring preferential treatment.

Volume 2: Contents: New battlefields are rising, and the consensus of e-commerce platforms

In addition to low-price discounts, various platforms seem to have reached a consensus on content development during this year's 618. E-commerce platforms such as Taobao and JD.com have increased their investment in the content track, while Douyin, Kuaishou, and Xiaohongshu are trying their best to maximize their content advantages, hoping to boost 618 transaction volume through live broadcasts and short videos.

During the 618 period, Taobao and Tmall launched the "50,000 new anchors' first show" plan. Many celebrities such as Cai Xukun, Li Xian, and Yang Zi will appear in the Taobao live broadcast room. In addition, many anchors such as TVB, Zhang Lan, Luo Yonghao, and Yang Tianzhen will enter Taobao for development. Live streaming has become an important weapon in the content battlefield of Taobao and Tmall.

In the past six months, Taobao Live has been constantly "poaching" talents, even at the expense of weakening the transaction attributes of the live broadcast room, and offering traffic support and cash rewards to pure content talents, just to attract more talents and brands to join. For example, on the eve of 618 this year, the "Coconut Tree Model Group" officially started broadcasting on Taobao, but no products were put on the shelves during the live broadcast. Pure content live broadcasts are gradually being allowed and promoted on Taobao.

In addition, Taobao and Tmall will launch four special columns during the 618 period: New Encyclopedia of Life, New Culture of Interests, New Scenes of Features, and New Lifestyles. For high-quality expert content, the platform will also provide traffic support in the information flow, shopping, venues, and outside the site.

Douyin, Kuaishou and Xiaohongshu, which have always focused on content, are making every effort to magnify their content advantages and improve the conversion efficiency of high-quality content.

It is reported that Douyin e-commerce's content gameplay during the 618 period mainly includes "Goods Live Room", "Selected Alliance Category Day" and "Douyin Ten Thousand Orders Plan". "Goods Live Room" will provide traffic and product subsidies to merchants and influencers; "Selected Alliance Category Day" will achieve efficient matchmaking of merchants through multiple resource positions in the Selected Alliance Selection Plaza; "Douyin Ten Thousand Orders Plan" will catalyze the birth of merchants' hot products through the large-scale exposure of content inside and outside the site.

Kuaishou e-commerce will invest 10 billion platform traffic and 1 billion commodity subsidies, and optimize the rules for traffic distribution, taking low-priced goods, caring services, and high-quality content as the underlying keywords for traffic distribution. The five major traffic support policies, including the Chuanliu Plan, short-term and direct linkage, cold start for new merchants, support for high-quality talents, and support for vertical industries, can more effectively help merchants seize public domain traffic.

It is not difficult to find that the two short video platforms, Douyin and Kuaishou, have focused their efforts on building links for content monetization. They hope to achieve large-scale exposure of content on and off the site through traffic support, thereby expanding the user base during the 618 period. However, Xiaohongshu has a different idea from the above two platforms.

This year, Xiaohongshu has been developing rapidly in the e-commerce track. First, a new live broadcast department was established, and then Dong Jie, Zhang Xiaohui and other top anchors with goods emerged one after another, making everyone look forward to Xiaohongshu's performance in 2023. In the live broadcast track, Dong Jie's first live broadcast during the 618 period lasted more than 8 hours and attracted more than 2.17 million viewers; Zhang Xiaohui's first live broadcast was more than 600 million in popularity and sales exceeded 50 million. In addition, Yang Tianzhen, Huang Yi and other celebrity anchors will successively broadcast on Xiaohongshu during the 618 period, focusing on niche items with higher customer unit prices to meet the consumption needs of high-net-worth and high-spending groups.

At the same time, Xiaohongshu fully opened up the sales notes before 618. The platform will also reward product notes and sales notes with different levels of exposure, and display them in a weighted manner on the recommendation page and search page, thereby amplifying the impact of the grass-planting content on the user's mind and deeply integrating conversion with the note content.

In addition to the above platforms that have already made some layouts in the content track, JD.com, which has always been relatively restrained in the content field, has also become a little impatient. This year's 618, the "Make Friends" live broadcast room was first settled in JD.com, and the preheating began on May 20. The venue exceeded 500,000 on the first day of the premiere. It is understood that on June 3, JD.com will launch the "Super Live Broadcast Day" to bring subsidies and exclusive low prices for live broadcasts to consumers, combining the low-price strategy with live broadcast sales.

JD.com's content strategy is mainly centered around seeding marketing, which brings exposure and publicity to merchants and products. For example, the "Ace BIGDAY" launched during the 618 period can customize exclusive theme activities for brands. The content matrix created by the platform in cooperation with major IPs such as Guoan and Disney provides merchants with a combination of exposure resources by leveraging the influence of content.

The increase in the content track of each platform is inseparable from the impact of verified content on transaction volume. If you want users to spend more money on the platform, you need to improve the efficiency of product seeding for users and increase the browsing time of users on the platform. From these two points of view, the richness and quality of content have become important factors affecting users' consumption decisions.

3. Volume AI: New concept support, focusing on marketing efficiency improvement

This year's 618 is very different from previous years. In addition to the usual low prices and support, emerging concepts and technologies such as AIGC and large language models have been applied by many platforms in the promotion, which not only brings new topics to the platform, but also fundamentally improves the brand's operating efficiency.

On May 23, Taobao and Tmall launched the "AI Ecological Partner Program" and opened seven business scenarios for merchants. Among them, product image creativity, marketing planning and promotion, content organization and creation, customer service reception and other functions have been gradually opened for application, and the first batch of settled units can already apply AI content generation, AI data and AI customer service functions. According to the signal released by Taobao and Tmall at the 618 Merchant Conference, the platform will realize the comprehensive intelligence of merchant operation tools, and promise that basic tools will be free for small and medium-sized merchants, and leading merchants can also enjoy R&D platform resource support.

Kuaishou has targeted the application of AI technology in three dimensions: search, AIGC-assisted image and text generation, and recommendation algorithms. Experts and merchants can provide search summaries through content generation, and create product copy, pictures, advertising scripts, video effects, etc., to increase the brand's own creation costs. From the perspective of recommendation algorithms, AI helps merchants provide more accurate search content matching and improve the ROI of content recommendations.

It is worth mentioning that on May 25, at the 2023 Vientiane Baidu Mobile Ecosystem Conference, Baidu launched a new e-commerce business "Baidu Best Selection". This new e-commerce business focuses on the integration with AI technology, and Baidu officially stated that it has entered the smart e-commerce track. The AI ​​function of Baidu Best Selection is mainly used in the fields of personal shopping guide assistants, digital human live broadcasts, and intelligent customer service in the mall, reducing the labor costs of stores through Baidu's existing AI technology.

Baidu has never had an advantage in the e-commerce field. This time, joining the 618 war with AI as a starting point is more like an attempt to find a new way. In the final analysis, the e-commerce track is a competition of people, goods and places. AI as a business tool plays a role of icing on the cake. For Baidu, if it wants to deepen its presence in the e-commerce field, it is not enough to have only "weapons", but also to ensure the supply of both merchants and consumers.

In addition to the official platforms, many third-party service providers have also launched AI-assisted functions, which can help brands operating on multiple platforms adjust copywriting according to the platform's tone, screen restricted words, optimize search keywords, etc. The manager of a well-known brand once said in an interview that AI has shortened the production time of advertisements by about 90% and significantly reduced the number of violations of brand copywriting, especially during major promotional events such as 618, where the improvement in efficiency is particularly obvious.

With the mutual recognition of platforms and merchants, many e-commerce operating companies that provide AI-related services have seen their share prices rise recently. As of May 23, Xinghui shares rose by 10.19%, Yiwang Yichuang rose by more than 5%, and ST Youkeshu rose by more than 4%... On the eve of 618, the capital market's recognition of AI in the e-commerce field also indirectly proved its help to operations.

During high-intensity events such as the 618 promotion, reducing costs and increasing efficiency have become the rigid needs of all merchants. This is also the entry point for various platforms and agency companies to provide AI-related services. From anchors to business tools, AI's support for the e-commerce track is still being developed and explored.

4. Final Thoughts

As the first 618 after the industry rebounded, content e-commerce and shelf e-commerce met on a narrow road, but also learned from each other, and e-commerce platforms gradually became more and more similar. The deep cultivation of old players and the entry of new players made this year's 618 particularly lively.

Bigger discounts, richer content, more diverse gameplay... All major platforms have made full preparations. At present, the first pre-sale battle has begun. Who will win in the next half month? Consumers and the market will give the final answer.

Author: Dake

Source: WeChat public account "TopKlout (ID: TopKlout)"