In order to save money, young people started the "mass migration" from Taobao

When Taobao is deeply trapped in inflated prices, where will the Z generation consumer group go? With the rise of e-commerce, how much impact will it have on traditional shelf e-commerce? The author of this article starts with the phenomenon of "low prices" on Taobao, introduces and analyzes the new shopping battlefield with a high reputation, discusses the key to the development of e-commerce platforms with the majority of new e-commerce people, and recommends it to children who are interested in e-commerce operations and market consumption.

Low price is always a powerful tool to attract consumers; if you can achieve “good quality and low price”, you will definitely capture the minds of consumers.

With the proliferation of e-commerce platforms such as Taobao, JD.com, Pinduoduo, and Douyin, comparing prices from multiple stores has become a basic operation for consumers before placing an order.

Nowadays, with the rise of B2C models and live streaming e-commerce, traditional shelf e-commerce seems to be gradually losing its price advantage, and the competition among e-commerce platforms is becoming more and more fierce. For example, at the end of 2022, Liu Qiangdong repeatedly emphasized within JD.com that JD.com should regain its low-price strategy; and on social platforms, topics about "Taobao prices are getting more and more expensive" have been raised one after another.

Under pressure from all sides, will shelf e-commerce platforms lose the favor of users? And how can they regain it?

01 “It’s too expensive”

An An, who has always loved online shopping, found that Taobao is gradually losing its price advantage.

An An, who wants to achieve the freedom of mopping the floor, has always wanted to buy a sweeping robot. Therefore, during the Double Eleven, Li Jiaqi's live broadcast room put the Ecovacs sweeping robot on the shelves. It is said that the 88 membership red envelope benefits can be used to purchase the Ecovacs T10omni customized version for 3,699 yuan.

Excited, An An did not hesitate and chose to place an order on Taobao directly. In the end, he bought it at a price of 3356 with various discounts and large coupons.

However, when the final payment was due, An An saw a lot of rights protection posts on Xiaohongshu. Some netizens said that the same product in the Ecovacs Douyin store can be purchased for 3,399 yuan without any membership or extra red envelopes. At the same time, the price on another shopping platform JD.com is also 3,399 yuan.

Image source: Xiaohongshu

But soon An An also found that the customer service on Taobao changed the words and said that no membership or red envelopes were required to buy the machine at the price of 3399. "According to this caliber, I went to the platform at this time and refused to refund the money to me because the actual payment amount was less than 3399." An An said that he was very angry. At that time, he gave up other products and used all the coupons on this product. "I wasted a large coupon in vain!"

An An is not the only one who encountered the same problem. On Heimao Complaints, there are also consumers who complained that "after purchasing 88 membership and getting various discounts, the final price plus the balance was 3422.11. However, under the same circumstances, other people's prices were cheaper. The prices were confusing and I felt I was cheated."

All of a sudden, a large amount of Taobao rights protection content and strategies, as well as guides on asking customer service to refund the price difference, appeared on multiple social platforms.

Some netizens said, "I chose Taobao because I trust this platform. After I bought it at a high price, I couldn't get an effective solution. Both sides passed the buck." Another netizen said, "Because of this incident, the entire Double Eleven shopping experience was ruined."

After this failed shopping experience, An An gradually developed the habit of comparing prices from different stores before placing an order. She found that not only sweeping robots, but many other similar products would be a little more expensive on Taobao.

For example, the Tianqidan in the Guangdong couple’s live broadcast room had a daily price of 1,390 yuan for a 7-piece set during the New Year’s Goods Festival, and a total of 22 pieces including gifts were received. However, in the Taobao flagship store, the same Tianqidan firming 7-piece set costs 1,660 yuan, and the gifts are also less.

Huawei P50Pro 256G is 5,309 yuan on Taobao, but only 4,459 yuan on Pinduoduo, which is nearly 1,000 yuan cheaper. In addition, the prices on JD.com are 4,719 yuan and 4,409 yuan on Douyin.

Screenshots of TikTok, Taobao, Pinduoduo, and JD.com

An An is not the only one who has the same feeling. Earlier on the social platform, someone asked the question: Why are the same products more expensive on Taobao?

02 New shopping battlefield

As Taobao’s prices are no longer competitive, many consumers have shifted their shopping to other platforms.

For example, some netizens have discovered that many products on Pinduoduo are cheaper than on Taobao.

One netizen said that he had seen a casual fleece jacket in a flagship store on Taobao, which was only priced at 188 yuan. He planned to place an order in the evening, but when he was browsing Pinduoduo, he found that the same jacket was priced at 153 yuan after using a coupon, a price difference of 35 yuan.

"Especially after seeing that both stores are flagship stores on the platform, I was completely confused." She was very confused. It was clearly the same store, so why was it dozens of yuan more expensive on Taobao? After asking the customer service of both sides, they gave the same answer: they didn't know about other platforms.

In a fit of anger, she bought two pieces of clothing to compare, and finally concluded that the two pieces of clothing were basically identical, with no difference in the feel, color, stitching, or pocket position.

Nowadays, many people are accustomed to buying daily consumables such as shampoo, paper towels, and various small household items on Pinduoduo.

On Zhihu, a netizen who works in e-commerce operations believes that the reason why Taobao's prices are higher than Pinduoduo's is because Taobao's operating costs are higher. For example, for a company's Taobao store with the same categories, products, and number of visitors, the cost of promoting and acquiring customers on Pinduoduo is only 50% of that on Taobao. The requirements for image design are also low, and you don't need a large team or senior designers to make the images. It's enough to operate your own PS technology.

In addition to Pinduoduo, more and more consumers are turning their shopping battlefield to Douyin.

"I have recently given up on Taobao and switched to shopping on Douyin," a mother shared on Xiaohongshu.

The reason why she gave up Taobao was that she didn't want to do the calculations too much. She said, "Every time I buy things on Taobao during a shopping festival, it's very tiring. There's a discount for this and that, and how much is two pieces? It really makes me dizzy. Now I just order what I need directly in the live broadcast room of the Douyin official flagship store."

After comparing the number of orders on the two platforms, she found that the number of orders on Douyin had unknowingly exceeded that of Taobao.

In addition, many netizens have also found that the price gap between Douyin and Taobao is not small. One netizen said that the two bottles of Ximuyuan Camellia Facial Cleanser bought on Taobao cost 139 yuan, with each bottle costing 69.5 yuan, but on Douyin, three bottles only cost 115 yuan, with an average price of 38.3 yuan per bottle.

"I have bought from Douyin several times and the prices are all good," said another netizen. He had seen many people complain about Douyin's poor after-sales service, but he did not have this problem after his experience. "Several crabs I bought from Douyin died the next day, and we compensated them all. There is also shipping insurance for returns, so I have given up on Taobao and now I buy from Douyin or Pinduoduo."

However, some male consumers still choose JD.com.

On the one hand, JD.com still has an advantage in digital products; on the other hand, JD.com's relatively clean pages and apps are more in line with men's shopping habits.

"JD.com's own express delivery is awesome." Some netizens said that they would choose to buy some goods that they need urgently from JD.com.

03 Low price is still the key

With the rise of e-commerce platforms such as Pinduoduo and Douyin E-commerce, as well as the entry of other new retail players, the domestic e-commerce competition landscape is becoming more complex and the competition is becoming more fierce.

But for the entire retail industry, including the e-commerce industry, price is the key to whether or not consumers can be retained.

At the end of 2022, Liu Qiangdong, founder and chairman of JD.com, mentioned many times within JD.com that "low prices are not only the core competitiveness of e-commerce, but also the eternal foundation of all competitiveness of all retailers in the world."

Liu Qiangdong said that if the customer experience of the retail business is divided into three elements - price, quality and service, low price is "1" and quality and service are two "0s". Without the low-price advantage, all other so-called competitive advantages will be reduced to zero.

Therefore, Liu Qiangdong pointed out that in addition to focusing on cost, efficiency, and experience, JD.com will also resume its low-price strategy and return to its users.

Looking back at Pinduoduo and Douyin, they are still able to stand out in the face of mature e-commerce platforms such as Taobao and JD.com and almost all categories have already been e-commerceized. The main reason is their price advantage.

The reason why Pinduoduo can achieve low prices is that it relies more on the low-cost traffic brought by WeChat’s social dividends and fission-style gameplay.

Pinduoduo focuses on the social + e-commerce model, and its "social group buying" fits well with the social attributes of WeChat. Through social sharing, under the effect of social fission, the more you share, the more profit you make. The social relationship chain has become the soil for traffic fission, greatly reducing Pinduoduo's traffic costs.

Pinduoduo is a B2C model, where manufacturers directly connect with consumers, eliminating the middleman, and lowering the price of goods. The strategy of the Pinduoduo platform itself will also be more biased towards consumers, and there have even been cases where merchants complained that Pinduoduo was biased.

In addition, Pinduoduo's group-buying model has tapped into the second- and third-tier city users and lower-tier markets that were previously ignored by e-commerce giants. According to Penguin Research, as of April 2018, Pinduoduo's lower-tier users were the main consumer group, with a high proportion of those with a high school education or below, and users' consumption concepts preferred cost-effective and discounted products. Pinduoduo has specifically launched low-price group-buying products such as "one yuan for tissues with free shipping" to continuously stimulate user consumption.

In contrast, Douyin, based on the trading platform of video content, has begun to focus on shelf-style sales, making full use of traffic and recommendation advantages to reduce the operating costs of small and medium-sized businesses.

An insider of Douyin e-commerce once revealed to the media that on Douyin e-commerce, merchants match suitable products with user interests and content creation as the core. There is no need to pay for keyword search rankings, event resource positions, etc. Marketing costs are reduced and product pricing is reduced accordingly.

On May 31 last year, at the second Douyin e-commerce ecological conference, Douyin e-commerce president Wei Wenwen announced Douyin e-commerce's new plan, upgrading interest e-commerce to the full-domain interest e-commerce stage, covering users' full-scene and full-link shopping needs, meeting users' diversified consumption needs, allowing shelves and shopping malls to coexist, and opening up the two-way consumption links of "goods looking for people" and "people looking for goods".

Therefore, after upgrading to the global interest e-commerce, it can also help consumers get low prices for high-quality goods through various methods (experts negotiating prices, brand self-broadcasting, and mall activities).

In addition, according to feedback from some brand merchants, because Douyin has a large number of users and a large transaction volume, many brands have positioned Douyin e-commerce as a new business position and a second curve for business growth. Merchants are willing to make concessions and lower prices or even break the price to sell on the Douyin platform. While generating GMV, live streaming can also give merchants strong brand publicity and promotion value.

How can shelf e-commerce platforms that have no traffic and price advantages win back consumers when they are squeezed by multiple platforms such as Pinduoduo, Douyin, and Kuaishou?

Author: Lin Xiaobai

Source: WeChat public account "Bianniushi (ID: bianews8)"