From the industry dominated by MCN to the cheating fees of merchants and the collusion between the two to deceive consumers, the live broadcast brought goods that entered the outbreak period in 2019 was once regarded as a fraud this year due to these fraud problems.
However, regardless of the soaring sales data: Luo Yonghao Tik Tok live stream 3 hours to bring goods 0.11 billion yuan; Dong Mingzhu Jingdong live broadcast 3 hours to sell 0.703 billion yuan; Or from villas to rockets and other sales categories, it all indicates that there are still many questions to be solved in this controversial industry. At the moment of "no live broadcast and no marketing", will live broadcast bring goods at an inflection point or continue to grow?
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with this doubt, the Economic Observer interviewed Kang Yong, KPMG's chief economist in China, and Zhou Jun, KPMG's chief market executive and partner in China. The two of them were deeply involved in a research report on live e-commerce. On October 12th, KPMG and Ali Research Institute released this long article with ten thousand words. It is not difficult to guess their answer through the name of this report-live e-commerce towards a trillion market.
Several figures mentioned in the report are also worthy of attention: they predict that the overall scale of live e-commerce will reach 1050 billion yuan this year, and the penetration rate of live e-commerce in the entire e-commerce market will increase by more than four percentage points to 8.6 percent; in 2021, these two figures will reach 2 trillion yuan and 14.3% respectively.
One side is the continuous live broadcast of rollover in the real context, the profit problem of brand owners and the whole supply chain coordination ability from anchor to MCN and even manufacturers to be tested; The other side is the soaring development data of the industry. All these contradictions lead to a question: why does live broadcast support trillions of markets? The following is an interview record:
as a marketing model based on new technologies, from the perspective of macroeconomic development, what is the incremental value created by live streaming? What is the essence of live streaming with goods?
Kang Yong: as a commercial application of Webcast, live e-commerce is that the anchor uses Instant Video and audio communication technology to introduce, display, explain and promote goods or services simultaneously, and communicate and interact with consumers for the purpose of achieving transactions. Live e-commerce has four social and economic benefits: stimulating consumption, increasing employment, industrial upgrading and rural revitalization:
one is to stimulate consumption and boost double circulation. The epidemic has forced the accelerated development and continuous innovation of the new consumption mode of live streaming with goods, releasing and expanding new consumption potential and transforming it into real purchasing power.
The second is to empower the traditional economy and drive industrial upgrading. Introducing Live e-commerce into factory production workshops, allowing consumers to fully watch and understand the production process of goods, can force the transformation and upgrading of upstream traditional manufacturing enterprises, allowing traditional manufacturing enterprises to jump out of their inherent thinking, find out the existing problems in time and come up with optimization plans as soon as possible to urge enterprises to innovate product production modes and marketing methods under the wave of digitalization and intelligence.
The third is to create new forms of employment and expand employment. On July 6, the Ministry of Human Resources and Social Security, the State Administration of market supervision and the State Bureau of Statistics jointly released nine new jobs, of which the most eye-catching is "Internet marketer". Under the "internet marketer", a new type of "live salesman" has been added. This means that what we usually call "e-commerce anchor" and "bring goods Internet celebrity" finally has the official title recognized by the state. In addition, a variety of new jobs such as help broadcast, product selection, script planning, operation and field control were also created in the live broadcast room.
Fourth, help rural poverty alleviation and boost rural revitalization. More and more farmers become anchors and begin to bring goods for their own agricultural products. Take the "village broadcast plan" of Taobao live broadcast as an example. Since its launch in 2019, the number of live broadcast sessions has reached 1.4 million, covering more than 2,000 counties in 31 provinces and cities across the country, more than 60000 Xin Nong Ren were added to the live broadcast, with sales of agricultural products reaching 6 billion yuan. More than 500 county governors walked into the live broadcast room to bring goods, helping county farmers increase their income.
In the future, we expect that the live e-commerce exhibition will be more ubiquitous, integrating anyone (Any-one), Anything (Anything), anyplace (Anywher e), at any time (Anytime), the development trend of 4A will become more and more obvious. The essence of live e-commerce is e-commerce. As e-commerce operators and e-commerce platform operators, merchants, anchors and service platforms participating in live broadcast e-commerce shall abide by relevant laws and regulations such as e-commerce law and consumer rights protection law.
Some voices believe that the total volume of the retail market is determined by the economic level, and the proportion of the retail market in GDP is relatively stable. Does this mean that there is a ceiling for live streaming?
Kang Yong: since 2019, the popularity of the phenomenon-level head anchor and the outbreak of the new Crown epidemic have brought the live broadcast e-commerce market into a real outbreak period. In 2019, the overall market size of live e-commerce reached 433.8 billion yuan, an increase of 210 percent year-on-year. The penetration rate in the e-commerce market (the proportion of live e-commerce turnover to the total e-commerce turnover) was 4.1 percent, there is still a lot of room for growth.
With the continuous expansion of "people and goods stores" in the live broadcast e-commerce industry, live broadcast will gradually penetrate into all fields of e-commerce in the future. Combined with quantitative research and industry experts, we predict that in 2020, the overall scale of live e-commerce will exceed trillion yuan, reaching 1050 billion yuan, and the penetration rate will also reach 8.6%. In 2021, live e-commerce will continue to maintain a relatively rapid growth, with a scale of nearly 2 trillion yuan and a penetration rate of 14.3 percent.
In addition, as the group of live streaming users becomes more mature, the demand for live streaming content becomes more professional. The "28th law" will be difficult to continue to apply to the market, the demand curve will be further flattened, and the demand in the Vertical Subdivision field will have unlimited potential in the future. Next, live e-commerce will enter a refined "deep cultivation" stage, with higher professional requirements and more and more detailed division of labor.
Residents' Consumption is indeed closely related to the level of economic development, but I think China's residents' consumption still has a lot of room for development. At present, China's residents' consumption accounts for less than 40% of GDP, which is not only still different from the world average, but also has a lot of room for improvement even compared with China's past historical level, for example, in 2000, the proportion of residents' consumption in GDP in China was also 47 percent.
As the epidemic is gradually under control, we believe that consumption will play a greater role in the next stage of economic recovery. On the one hand, the improvement of consumption will bring greater market to live e-commerce.
On the other hand, live e-commerce also has an additional pulling effect on consumers, which has realized some previously unmet needs. We believe that live e-commerce still has a lot of room for development. This is also reflected in our questionnaire survey on brand owners. Nearly half of the interviewees believe that live e-commerce will continue to grow at a high speed in the future.
You mentioned in the report that the live e-commerce "empowers the traditional economy and drives industrial upgrading", can it be carried out specifically?
Kang Yong: The sales path of live e-commerce can be simply regarded as "goods-anchor-consumer". Goods are the key and core of live delivery. On the surface, live e-commerce is a competition of traffic, behind it is the test of supply chain capability.
The development of live e-commerce provides a new opportunity for the transformation and upgrading of China's traditional manufacturing industry. A major way to combine traditional manufacturing industry with live e-commerce is factory live.
In the past, the production workshop of goods was "far away" from consumers, but now consumers can further understand the design, production, assembly and other links of goods through factory live broadcast, so as to have a comprehensive understanding of the factory's product manufacturing mode and process, consumers can evaluate the manufacturing capability of a certain brand, so that consumers will be more targeted when they finally purchase products.
Introducing Live e-commerce into factory production workshops, allowing consumers to fully watch and understand the production process of goods, actually playing a supervisory role, which also forces the transformation and upgrading of upstream traditional manufacturing enterprises, let traditional manufacturing enterprises jump out of the inherent thinking.
Enterprises need to carefully examine all aspects of the industrial chain of goods from design, manufacturing, circulation to sales, after-sales and so on, find out the existing problems in time, and come up with optimization plans as soon as possible to promote enterprises in digitalization, under the wave of intelligence, C2B customization methods of consumer reverse customization, innovative product functions and marketing methods are provided.
In addition, introducing live e-commerce into manufacturing industry to realize direct sales live broadcast of factories, which shortens the marketing link, enables factories to master consumers' preferences more comprehensively and quickly, and can quickly analyze the styles of goods, adjust fabrics, colors, etc. to realize flexible production in factories and reduce research and development costs and stocking pressure.
A large number of old factories, department stores, and wholesale markets have taken live e-commerce express trains, extending from offline to online, such as Hangzhou purpleflower holly leaf clothing wholesale market and Yunnan Ruili jade wholesale market, realized the rebirth of Nirvana.
You mentioned that live e-commerce can shorten the marketing link and realize flexible production in factories. However, in reality, the peak traffic brought by live streaming often brings great challenges to flexible production. How can the live broadcast industry ecosystem coordinate and solve these problems?
Kang Yong: Compared with traditional e-commerce, the biggest advantage of live e-commerce is to change from "people looking for goods" to "people looking for goods". "Goods looking for people" initially in the live broadcast e-commerce mainly refers to the anchor recommend to the audience in the live broadcast room to find for the goods of brand owners.
In the future where live broadcast is further popularized, "everyone can broadcast", "everything can be broadcast" and "everywhere can be broadcast", goods can be directly connected with factories through live broadcast, users drive production, thus reducing channels, retailers and other links, reducing costs for enterprises and providing consumers with "factory prices", which is C2M mode.
We believe that C2M may become an important direction for the future development of live e-commerce, and brand owners and platforms are also optimistic about the development of this model.
For example, in March this year, Changhong TV started live broadcast in its 5G digital production line, and received more than 45000 orders in 2 hours, with sales exceeding 0.1 billion yuan.
E-commerce platforms have also laid out C2M mode one after another. Taobao released its C2M strategy for the first time in March this year. In April, Jingdong announced that it would launch the "factory direct quality" plan for the industrial belt in C2M mode. In the C2M strategy released by Taobao, Taobao Special Edition APP, super factory plan and double hundred goal are also called the three pillars. The goal is based on core digital capabilities and Taobao Special Edition. In the next three years, help 1,000 industrial belt factories upgrade to "super factories" with an output value of over 100 million, create 10 billion new orders for industrial belt enterprises, and focus on building 10 digital industrial belt clusters with an output value of over 10 billion nationwide.
Jingdong's social e-commerce platform "Jingxi" launched the industrial belt "factory direct quality" program, trying to empower C2M and marketing through special cooperation with local governments, facing the sinking market, promote new retail infrastructure in industrial belts and source areas.
The report mentioned "two puzzles of merchants in selling goods Live", which touched on the problems that merchants could not achieve profits and eliminate brand value. How should brand owners carry out live streaming?
Zhou Jun: brand owners should have a clear strategic positioning and comprehensive consideration to avoid blindly choosing live broadcast. In terms of the formulation and implementation of live broadcast marketing, the best live broadcast selection is achieved based on the brand's own situation and the expected purpose of the current live broadcast through the four elements: Supply Chain + anchor + anchor + anchor + fan + platform.
In terms of goal setting, it is clear that short-term goals are mainly sales and product promotion, while long-term goals are mainly brand grass planting and market User cultivation. In terms of Consumer Focus, pay attention to the demand of different levels of people on the platform, gradually penetrate into each circle of the platform, and seek high conversion rate.
Another factor in the live broadcast is that brand owners cannot avoid it, which is to make profits. Brand discount is a sharp tool to promote product sales in a short time, and it is also one of the important features of live e-commerce. But this runs counter to the concept of brand building and creating long-term brand premium effect. In actual marketing, how should this unavoidable problem be considered?
First of all, what needs to be considered is the development stage of the category itself and whether consumers will "compromise inertia" in consumer psychology due to compromise in the short-term compromise behavior at this stage ", brand owners should establish appropriate mechanisms such as" seasonal limit "and" Internet celebrity exclusive "to reduce the consumption psychological expectation.
Secondly, it is necessary to strengthen the display of product differentiation characteristics. In the initial stage and the middle stage of category development, it is necessary to strengthen brand differences and weaken the psychological strong correlation between promotion and price. Internet celebrity the reasonable choice of live broadcast can effectively avoid this risk.
Finally, when choosing the time point of brand discount, resonance should be achieved by combining event marketing, Hot Marketing and channel marketing, what needs to be caused is that discount is a "incidental" low probability event rather than a "normal" high incidence event.
In fact, there are many participants in the live e-commerce ecosystem, including platforms, MCN agencies, government agencies, etc. in addition to brand owners. As a new business with only four years of development, live e-commerce still needs the joint efforts of many parties to truly achieve sustainable development.
As far as brand owners are concerned, in the process of investigation, many brand owners said that they are not skilled in live broadcast operation and lack of live broadcast experience are the prominent pain points faced in the process of live broadcast marketing. Many brands have almost zero experience in live marketing. However, due to the epidemic, offline sales are weak and they have to actively cater to changes and join the big wave of e-commerce live streaming.
This also shows that brand owners have a high demand for live broadcast training. For example, MCN institutions and platforms can carry out some related training, such as the process of live broadcast and how to increase the popularity of live broadcast rooms, how to realize topic interaction and so on to help brand owners make better use of live broadcast as a new marketing method.
Affected by the new Crown epidemic, live streaming seems to play a more important role in helping enterprises clear inventory. If the industry wants to develop healthily in the future, which links will play a crucial role?
Kang Yong: as a rapidly developing emerging business form, live broadcast does have some risk points. In addition to the product quality and price system disorder brought by inventory clearance for enterprises, for example, some anchors exaggerate or falsely advertise products, anchor fees are too high and the sales effect is not as expected, sales figures are exaggerated, tax payment is not standardized, etc.
If you want the industry to develop healthily, all participants need to make joint efforts. Brand owners need to formulate appropriate live marketing strategies. MCN organizations and anchors need to focus on how to further improve the cost performance of products so as to gain the recognition of consumers. The platform needs to further refine the supervision and management responsibilities of the live broadcast e-commerce business, strengthen the audit of the operators in the platform, improve the qualification audit standards for the anchor, and focus on the quality of the anchor recommend products, further improve the protection of consumers' rights and interests.
While supporting live e-commerce and promoting its sustainable development, government agencies suggest that live broadcasts of different types, risk points and risk levels can be classified and managed. Considering various factors such as application fields, application scenarios and openness of fields, types of information content, consumer consumption purposes, etc. of webcast, this paper analyzes the compliance risks of different types of webcast, so as to carry out more targeted governance and realize the unity of promoting development and limited supervision.
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(Article Source: Economic Observer, invasion and deletion)
