The anchor started his career by selling small commodities for 9.9 yuan

Many anchors will use low-priced products to gain popularity in the live streaming rooms. Now, "9.9 small commodities" can still bring traffic to anchors, but after that, what should anchors do to continue to move into the niche field? In this article, the author expressed his views, let's take a look.

The live streaming e-commerce market was once dominated by “9.9 yuan small commodities”.

In the era of live streaming e-commerce where the main purpose is to clear inventory and promote sales, "9.9 yuan for small commodities" is roughly equivalent to the ticket for live streaming e-commerce. In the early years, Simba and Viya both started out by selling products with low customer unit prices.

After live streaming has gradually become an important sales channel for major brands, the market is no longer dominated by "small commodities priced at 9.9 yuan". Various mid-to-high-end brands have flooded into the live streaming rooms as merchants broadcast their own products, and there are a wide variety of products for consumers to choose from.

Mid- to high-end brands are usually consumed by merchants’ live broadcast rooms and top anchors. What flows into the hands of most anchors are still “small commodities priced at 9.9 yuan,” and such commodities are far more likely to cause impulse purchases than mid- to high-end commodities. Even if you pay 9.9 yuan for a bad purchase, it is only a single-digit loss.

At a time when clearance sales are no longer the only mission of live streaming e-commerce, the comfort zone of “9.9 yuan for small commodities” is shrinking, but it is the fastest way for anchors to gain a foothold. Only after gaining a foothold can anchors move into more niche areas.

1. Popular “9.9 yuan small commodities”

Live streaming e-commerce stands out from the entire Internet mainly due to the price advantage of its products.

The anchor has a certain appeal across the entire network and can use his own traffic and skills to quickly push products to the consumer market and help the brand gain popularity.

Therefore, merchants are willing to "lose money to gain publicity" during the product promotion period and offer the lowest price in the live broadcast room. On this basis, anchors will also create a low-price atmosphere for consumers through words such as "manufacturer benefits" and "lowest price in the entire network" in the live broadcast room to increase the transaction rate.

Merchants and anchors have joined forces to create a number of popular products that are the same as those of "such and such anchor". At that time, many Taobao pages that displayed the same products as "such and such anchor" had monthly sales of over 10,000.

Low prices are the killer feature of live streaming sales, and small commodities priced at 9.9 yuan are the weapon for anchors to win over their “family members”.

These small and medium-sized commodities, priced below 20 yuan, are mostly daily necessities such as soap, insoles, and thermos cups, which are frequently used and have a wide audience. At the same time, since the prices are relatively low, consumers have a short decision-making time and are prone to impulse purchases, so the conversion rate in the live broadcast room is very high.

Many anchors such as Simba and Viya started their careers by selling small and medium-sized commodities.

Zinc Scale has learned through investigation that for small commodities such as mosquito coils and marinade that cost RMB 9.9 and include shipping, the anchor’s commission can account for about 50% of the commodity’s selling price. After deducting the cost ranging from 20% to 40%, the profit received by the merchant may be less than half of the anchor’s commission.

For big-name beauty and digital products with high average order value, although the anchor can get higher commissions in a single live broadcast, the overall commission level may be comparable to or even lower than that of small commodities priced at 9.9 yuan.

Firstly, most consumers tend to make rational decisions when purchasing high-priced goods such as mobile phones. They tend to compare prices before placing orders on e-commerce platforms or physical stores, and will not easily make impulse purchases in live broadcast rooms.

Secondly, when selling such goods in the live broadcast room, the merchants or anchors mainly provide price subsidies to attract consumers. This is the case with the digital products that Luo Yonghao promoted in his first live broadcast on Douyin. However, such subsidy activities are common at important shopping nodes such as the launch of new anchors and Double Eleven, and cannot be normalized.

Consumers with sufficient balances may make impulse purchases for high-priced products, but the current market only needs one or two top anchors who focus on high-end products to be saturated. Moreover, these large brands with high average customer spending are supporting their own anchors to reduce their reliance on external agencies such as MCN.

On the contrary, most manufacturers of small and medium-sized commodities do not have sufficient budget for large-scale marketing and promotion, and their products mainly rely on word of mouth in the industry to gradually gain popularity locally and nationwide.

With the rise of live streaming, small and medium-sized businesses can quickly open up product sales channels with the help of anchors’ influence on the Internet. Although cooperation with anchors usually requires merchants to make great concessions, once sales channels are opened up, their overall profits are higher, and merchants are also happy.

In comparison, small and medium-sized businesses rely much more on live streaming than big brands. Therefore, for most anchors, small and medium-sized commodities are the mainstream products.

2. Small commodities, big names

The "9.9 yuan small commodities" seems to be a basic skill in selling goods, but not all anchors can easily get it. "Xiang Tai Chen Lan"'s first Douyin live broadcast was overturned because of the "9.9 yuan small commodities".

Xiang Tai has strong financial strength and has adopted a "rich" persona. Her daily Douyin posts mainly share jewelry knowledge and show off her luxury homes and cars. This kind of persona is more suitable for cooperation with mid- to high-end brands. Several of Xiang Tai's Douyin videos of cooperation with big brands have received about 100,000 likes, and the comments section is mostly supportive. The communication effect is very good, but it does not help with conversion.

For anchors who want to engage in live streaming sales for a long time, a strong correlation between their own personality and the types of products they sell will help them quickly gain recognition in the market.

Earlier, Li Jiaqi gained popularity through lipstick reviews and claimed to be a friend of all girls. He would also provide emotional value to female users by inserting some instructions and concerns during live broadcasts. In this cycle, the anchor's personality, the products he sells, and the target users are deeply bound together. After the Dongfang Selection became popular, it also chose to start with book products that matched its own image and temperament, and gradually expanded to agricultural products and clothing to strengthen its own brand image.

Although using the persona of a "rich person" to promote "9.9 yuan small commodities" has aroused doubts, it will not necessarily fail. Since Xiang Tai, who is not in line with the "9.9 yuan small commodities", cannot gain the natural favor of consumers through her persona, she should make up for it through her words and actions.

However, Xiang Tai herself was unwilling to try the products she brought in during her first live broadcast, and did not respond when the assistant initiated an interaction. Regardless of Xiang Tai's original intention, netizens' emotions have been ignited, and such backlash has brought about a decline in traffic and a crisis in word-of-mouth.

Low-priced goods have an obvious effect in attracting traffic in live streaming, but once there are quality problems with the products, the negative impact will be multiplied. In June last year, New Oriental was embroiled in controversy over the hairy peach issue and embarked on the path of building its own supply chain.

Most small and medium-sized commodities do not have high technical content, and the funds required for investment in factories are also within a controllable range. In order to avoid the risks brought by product quality problems, many anchors will invest in building factories themselves to strengthen quality control from the production end. Another major advantage of investing in building factories is that the products can be directly connected to the consumer end through live streaming after production, eliminating unnecessary transportation and warehousing links, and helping producers and consumers to make profits.

Strictly controlling the quality of “9.9 small commodities” can maximize consumer trust in the early stages of sales, thus laying the foundation for the conversion of high-priced commodities.

Consumers are more inclined to place orders for high-priced products such as air conditioners and big-name skin care products in brand live broadcast rooms because the brand itself endorses the product with trust - the product quality and after-sales service are guaranteed. If live broadcasters want to increase the conversion rate of high-priced products in their live broadcast rooms, they must increase consumers' trust in themselves and use their own "brand" to guarantee the products.

Dongfang Zhenxuan also gradually added high-priced products after improving its supply chain and ensuring the quality of "9.9 small commodities". From this perspective, holding "9.9 small commodities" means getting the ticket to high-priced products.

3. The era of one-man show is over

As the influence of live streaming sales grows, anchors investing in factories and merchants live streaming is bound to become a new trend. The entire live streaming ecosystem has also moved from the original gathering place for white-label products to the mid-to-high-end market.

The live broadcast room is full of "poetry and distant places". Oriental Selection mainly promotes various high-priced clothing such as Converse and Nike. In addition to the quality of the goods, the brand itself has also become a part of the live broadcast. Previously, major live broadcast rooms emphasized more on the functional attributes of goods such as product price and quality.

The label of "cheap" has been attached to live streaming e-commerce for a long time. With the success of well-known brands such as Uniqlo, Nike, and Gree, live streaming e-commerce is no longer just a promotional channel for clearing inventory, but has instead acquired a marketing meaning of strengthening brand awareness and expanding product influence.

Luxury brands are actually the ones that find it most difficult to get a share of the marketing pie in live streaming sales. The high premium of luxury goods comes partly from the sense of mystery surrounding them in the minds of consumers, and “shouting-style” live streaming sales is the best way to break this sense of mystery.

In 2020, LV was mocked for its casual background and down-to-earth style. After that, luxury brands tightened the pace of live streaming, mainly through cooperation with super anchors to sell goods on a small scale.

If transaction volume is the only purpose of live streaming, luxury brands will most likely miss out. However, many live streaming platforms are now promoting and maintaining brand influence, most notably big brands such as L’Oreal. The hosts of these live streaming platforms are mainly responsible for product introduction and brand promotion, and transaction volume is not the only consideration.

At present, many anchors have also begun to try to weaken the product-carrying function in their live broadcast rooms and increase marketing attributes. Not long ago, in his first live broadcast, Li Dan slowed down the pace of product listing and extended the time of product introduction. Before introducing the Volvo S60, he spent about 20 minutes talking about the 500 yuan car deposit and 1.1 yuan test drive coupon. In addition to bringing goods, he emphasized the introduction of the product itself and the brand.

The vice president of Jiaogepengyou said, "We may not use transaction volume as the only indicator to measure Li Dan's live broadcast room. Many brands choose Li Dan, perhaps not to sell goods, but as a brand cooperation."

Whether Li Dan's live broadcast room can successfully achieve brand marketing remains to be seen, but the attempt of this concept shows that live streaming sales are differentiating from "clearance sales" to high-end and brand marketing.

Under this trend, the anchors who got their start by selling “small commodities for 9.9 yuan” should also be prepared for danger and think about what to do next.

Author: Xia Tian

Source public account: Ginkgo Technology (ID: yinxingcj), bringing you the best business people and stories.