text丨Ren Qianwen
Edit丨He Yang
[Yibang Original] "The boss of cross-border e-commerce looked for round A two years ago, last year, and found a job this year!"
jokes revealed this trillion-scale track, which has changed rapidly from a blowout to a big cooling in just two or three years. One fact is that while the industry's heat gradually declines, the confidence of practitioners seems to be reduced.
"" ", "Lying flat", "Just ask for orders not to be zero"... Even in the most popular peak season promotion nodes in the past, this year was full of cold.
However, "always cheer for opportunities, and often ignore risks; I was still crazy at the last moment, but I was overly pessimistic at the next moment." This is the tree without roots. When the general environment is good, some companies will die; when the general environment is bad, some companies will grow. New demands and new values often emerge with crises and troughs.
As an industry insider said, in the midst of rapid progress, the threshold and competitive landscape of the overseas industry are improving, and the comprehensive quality of entrepreneurs is also improving. The company's valuation has returned to reasonableness and the industry has entered a state of healthy development.
"We still firmly believe that companies with a market value of 100 billion will be born in this field, whether it is a brand that goes overseas or a brand that is both internal and external." Wei Zhe, founder and chairman of Jiayu Capital, made a judgment at the "2022 Yibang Brand Globalization New Force Summit" held today.
He pointed out that the current annual sales scale of cross-border e-commerce is about 4 trillion yuan, far exceeding China's traditional foreign trade, but Anker Innovation, which has been listed in the industry, is the first product-oriented company. However, China's capital market will soon usher in a sector of cross-border e-commerce overseas brands. The sector is very important. Only with it will analysts and institutional investors pay attention to it seriously, because no one can put such a research team just to study a company.
"This spring is coming soon." Wei Zhe said that from the perspective of the secondary market, the investment portfolio includes cross-border e-commerce, which is the best way to hedge risk for consumer investment. Because, if domestic consumption is weak, and cross-border exchange rate and shipping costs reach the best in history, these companies' profit will hedge the pressure that may be faced in China well. The same is true for investment. If you invest in consumption, you must invest in both good domestic consumer brands and consumer brands with the ability to go overseas across the country.
01
"squeezing bubbles"
022 is a year when the industry returns to rationality. According to incomplete statistics, there were 60 overseas brand financing incidents in 2021, with a single financing amount ranging from millions of yuan to hundreds of millions of US dollars. Many companies have completed 2-3 consecutive rounds of financing within one year in 2021, and there were more than ten financing incidents of RMB 100 million. In the field of cross-border service providers, the monitoring data of the e-commerce big database "Dianshubao" shows that in 2021, a total of 50 financing incidents occurred, with a total amount of more than 7.15 billion yuan, of which 41 occurred from January to October.
But this year, the capital market is obviously more cautious and calm about the cross-border e-commerce industry. As of October this year, about 23 overseas brands and 21 service providers have completed financing, and both the number of companies and the amount of financing have decreased significantly compared with last year. In addition, the cash flow of forward and the ability to quickly achieve profitability are also regarded as one of the important measurement criteria for whether a project is worth investing in.
The market "false prosperity" in the first two years was gradually squeezed out like a bubble. There are countless businesses, large platforms and large enterprises that are facing life-and-death decisions.
The big seller of an old independent website was rumored to be "operating difficulties and filing for bankruptcy", which caused a lot of controversy. Although the official quickly issued a statement denied false rumors, it also admitted that the operation this year is indeed under great pressure. Cutting down SKUs, transformation, and laying off employees are all unscrupulous moves to maintain the survival of the company.
American flash auction e-commerce platform Tophatter announced the failure of the Chinese market expansion plan with a notice that "officially closed Chinese sellers and returned to the domestic US market."
set out from Southeast Asia and advanced all the way to Shopee in many markets in South Asia, Latin America, Europe and other countries. This year's situation seems to have begun to take a sharp turn. Not only did it shut down sites such as India, France, Spain, etc., it also significantly reduced its business in South America, withdrew from Argentina , and closed its local businesses in Chile , Colombia and Mexico .
"Continuously take efficient measures and focus on core business" - this is the main reason Shopee gave in response to the constant news of "releasing staff".
Even the popular Shopify has experienced its first large-scale layoffs since its founding this year - in July, it announced the layoff of 10% of the total global workforce (about 1,000 employees). Founder Tobi Lütke admitted that he misjudged the continued growth trend of the e-commerce boom - as consumers resume their offline shopping habits, online orders continue to decline.
Meta advertising revenue is in a difficult situation. Its latest financial report shows that in the third quarter of 2022, the company's revenue was US$27.71 billion, a year-on-year decrease of 4%, which is the second consecutive quarter that revenue declined year-on-year; net profit in the third quarter was US$4.394 billion, a year-on-year decrease of 52%, and a four-quarter decline in the future; the stock price fell by nearly 20%, setting the lowest since 2016.
So, in the context of global economy being downward and the international market is full of so many uncertainties, why should enterprises firmly follow the globalization and branding route? Liu Chen, co-founder of Yibang Power , pointed out at the summit that globalization is to achieve the greatest matching between external resources and internal resources; not all companies need to build brands, but brands must be pursuing higher quality development. Brand globalization is the best risk-resistant and sustainable long-termist path for enterprises. Tang Jian, head of international market strategy at
Yuanqi Forest , said in his speech that it is really difficult for brands to go overseas, and it is even more difficult for beverage brands to go overseas. It is not an exaggeration to describe it as "a messy feather". So why does Yuanqi Forest still do this?
"Beverages are a very simple industry related to the population dividend of and the population, but looking at the global food and beverage company with a total of 100 billion US dollars, they found that there is no Chinese company." Tang Jian said, "We believe that every generation of Chinese people has their own mission, and China is the responsibility of our generation. Therefore, since its inception, Yuanqi Forest hopes to be a global food and beverage company and bring good products to consumers around the world."
She pointed out that in the beverage industry, although the Chinese market is large, the overseas market also has a lot of room for imagination. It is reported that Yuanqi Forest has been sold to more than 40 countries and regions. It is the first and only foreign brand to enter the top ten of Amazon's sparkling water in North America, and offline has effectively entered the mainstream local channels in major national markets such as Australia, Indonesia , Malaysia and other major countries.
02
From "cross-border e-commerce" to "cross-border brand"
In Wei Zhe's view, although there is a trend of anti-globalization now, the continuous global supply chain determines that cross-border e-commerce still has a big market. At the same time, China will definitely need foreign trade exports in the next few decades, and cross-border e-commerce, as a new growth point for foreign trade exports, can introduce more favorable policies almost every month or even weekly.
"Cross-border e-commerce" will move towards "cross-border brand". Wei Zhe pointed out that e-commerce is the first step, and cross-border brands mean penetration and service capabilities in omnichannels. He suggested that the initial stage of cross-border e-commerce should start with product-oriented companies, focusing on product research and development, supply chain, and brand building, so that the brand can become a "category killer."
Mars Group Kinship China General Manager Chen Xi pointed out that the common difficulty of Chinese companies going overseas is Under-branded. First, the brand image is not unified, the marketing is silent, and third, the customer service is weak. Therefore, the company's brand team must have the construction of these three key capabilities.
Chen Xi summarized the four successful weapons that they deserve to learn from the rapid growth path of emerging overseas DTC brands:
First, grasp the beauty of young people, create an atmosphere that belongs to young people, and give users a sense of identity; second, subtraction and focus on functions, and innovation through differentiated functions; third, focus on fan operations, and repurchase rates will be higher; fourth, have high cost-effectiveness.
Zhou Kang, founder of Chengzhe CZUR, who tasted the sweetness of branding, pointed out that Chengzhe did not deliberately invest in the brand, but insisted on revealing the brand since the first day of its establishment. "In the process of brand building, we do not need to build a brand specifically, but insist on branding and marketing and appropriately doing marketing." He said.
Zhou Kang believes that building a long-term global brand requires four advantages: First, the definition of product innovation capabilities, which can create products that are different from this era; Second, excellent industrial design, which is a very critical point in shaping a brand; Third, building an e-commerce brand, which is relatively easy, and is also a relatively good thing for truly high-quality product companies; Fourth, based on localized operations, overseas agents can be developed and as a participant in the local long-term profit-making area, deeply cultivate local brands.
How can Chinese brands form better brand communication power in overseas markets? JOVS co-founder Alice believes that consistency in brand tone is very important. Whether in China, the United States, or Japan, first of all, the brand vision must be consistent; secondly, when spreading globally, you can persist in the unique genes of your brand. The communication methods, selling points, and main recommendations can change according to regional differences, but core things such as brand stories and content cannot be changed; in addition, there must be very systematic management.
"Born as a global" is the positioning of Haibeizhi's company at the beginning. Using localization to drive globalization is the brand development path of Haibeizhi. In the view of Sita, vice president and CEO of China, in HEBE BEAUTY, to build a brand in overseas markets, you should be globalized when thinking, localized when executing, and have the ability to internationally collaborate. This is also the key to why HaiBE can connect the resources of four Southeast Asian countries in a short time.
It is worth mentioning that the overseas trip of a brand is definitely not just a brand’s business, but also a matter of a country’s comprehensive infrastructure trip, including payment, technology, and logistics.
Liu Xinyang, general manager of Cainiao International Export Logistics Department, believes that for consumers, products cannot determine 100% consumption experience, and products + services can provide a more perfect consumption experience. Therefore, cross-border logistics is an important part of Chinese merchants building brands in overseas markets.
He pointed out that at this stage, there are not only a large number of merchants and brands that still need high cost-effective and high certainty logistics services, but also the top merchants and brands need more attention to brand value, brand image and logistics services that are closer to refined supply chain management needs. In the future, cross-border e-commerce logistics must achieve four points: high controllability, full link, high availability, and digital , and continuously optimize and improve the diversification and digitalization of logistics solutions.
According to Fan Fan, head of the Atome China region of BNPL (Enjoy First Payment) brand, a large number of brands are focusing on emerging markets in Southeast Asia, and users in Southeast Asia have very strong demand for BNPL - by 2025, the scale of BNPL payment methods in Southeast Asia will grow 8.7 times compared with 2020, reaching a scale of US$8.84 billion. Therefore, serving consumers through BNPL payment is also a powerful way to establish brand influence.
Fan Fan pointed out that the value of BNPL for cross-border independent sites mainly lies in four points: First, increase GMV, and ensure the total consumption of goods by increasing consumers' desire to purchase; Second, risk management, the difference in consumer installment payments will be paid by the platform, and merchants do not need to bear risks; Third, traffic, private domain traffic can be transferred through the APP; Fourth, increase the repurchase rate, and young consumers are more willing to place orders on a platform with "enjoy first and pay later".
03
How to cross the vortex and grow scientifically?
"In addition to the two categories of food and beverages, there are too many categories that are worth doing again with cross-border e-commerce."Wei Zhe judged this way.
He suggested that in terms of category selection, it is best to do categories that are not common in China and abroad, so that such categories are easier to obtain high gross profit margins. But no matter which category, cross-border e-commerce starts from product companies, focusing on product research and development, supply chain, and brand building, making the brand a "category killer".
At the "2022 Yibang Brand Globalization New Force Summit" held today, more than 20 guests also summarized the methods of crossing the cycle and winning scientific growth from their own exploration results:
1. With weak consumption and shrinking markets, there must be a supply chain that responds quickly
OTTO China CEO Xu Beisi said that European consumers face more severe livelihood issues this year. The issues they are concerned about: First, rising prices affect their daily lives; Second, the conflict between Russia and Ukraine affects security; Third, the unemployment rate, and the continued weak economy has made more and more European consumers afraid to consume and start saving money; while climate change and the epidemic have dropped to the fourth and fifth positions.
On this basis, merchants in the European market should pay attention to the changes in consumption trends of "pursuing diversification, rejecting convergence, ignoring brands, and paying attention to high cost-effectiveness". This is a good business opportunity for Chinese merchants who can provide a supply chain that can respond quickly and have high cost-effectiveness.
2 , offline channels must be grasped
CATLINK founder Zhang Xiaolin summarized the brand's overseas experience into three points: First, each country uses exclusive agency method; Second, establish its own local team in the European and North American markets, first of all, do American and Asian, secondly, do independent websites and product promotions; Third, offline channels must be grasped, online channels can not make money. In order to build a brand, once a brand has a large offline channel, it will take the initiative to find it.
3. Don't fall into the trap of "selling goods in the world"
"Providing products that meet the needs of the target market is the most basic attitude of brand going overseas, and providing a good service experience of target consumers is the biggest added value of the brand. "Chen Huan, head of Lily's overseas business, said.
Sita also pointed out that taking beauty products as an example, in the diverse cultural environment of the Southeast Asian market, users in different countries have different needs for product efficacy, so they must develop products according to the real needs of users.
4. Value identity is the key element in building a brand
" Calculate people's hearts and hearts is the foundation of business growth. "In the view of the founder and chairman of Focus Media Jiang Nanchun , the ultimate result of cross-border e-commerce traffic is that it cannot retain both the volume and the hearts of the people. The brand is an algorithm that calculates the hearts of the people and makes consumers willing to buy. This is the fundamental basis for long-term business growth. Building a brand is to become the first choice for a certain category, a certain field or common sense.
It is reported that Kantar confirmed through the research on the total marketing return on investment of TMROI that 70% of the company's sales are contributed by brand assets, while the sales achieved by short-term direct conversion only account for 30%.
Founder and CEO of Vesta Gu Zhenyu believes that the so-called sense of brand value requires many fulcrums, and each module such as products, services, content must be the ultimate, and none of them are missing. To provide ultimate products and ultimate services with the ultimate brand, we can start from consumer portraits, product research and development and design, brand propositions, user services, etc. to create a unique sense of value for the brand.
5. Logistics requires full-link ideas
"Many companies pursue the lowest single-point cost, such as the lowest overseas warehouse and the lowest shipping, but there is no full-link thinking. The complexity of cross-border e-commerce logistics is something that domestic e-commerce or domestic consumer brands have never seen before. Domestic e-commerce may not require full-link thinking in China, but overseas must have full-link. What we want is not to minimize the cost of a single link, but to optimize the cost of the full link. "Wei Zhe pointed out. Kenny, vice president of Jitu International, also said that behind brand globalization is the globalization of resources, and the carrier of resource globalization is the new logistics infrastructure.Globalization first requires full coverage, and all resources are in multiple directions; secondly, timeliness, not only traditional sea, land and air transport capacity, but also higher timeliness requirements for customs clearance, warehousing operation, and delivery after landing; in addition, as products become more and more abundant and regions are more and more, logistics needs to be customized to meet different customer needs.
"To support globalization, timeliness and personalization, there must be a huge IT system, that is, digitalization." Kenny said, therefore, it is necessary to create a one-stop service product with the full link of international logistics to meet the higher-level development needs of brands going overseas. Wu Peng, founder of
GT Racing, also expressed the same view. In his opinion, cross-border overseas travel mainly depends on comprehensive capabilities, from design, production, R&D to logistics, warehousing and last mile delivery, as well as understanding of consumers and offline channel construction. If the comprehensive capabilities are relatively strong, the brand will be easy to get out.
6. Through the "data penetration" capability, we can cope with complex market changes overseas
In the view of Liu Yaxiao, CTO of Amazon Cloud Technology Greater China, the deployment of digital and automation tools is the basis for overseas brands to revitalize data and develop scientifically. Overseas brands pay attention to the significance of digitalization and data processing tools. First, it is to improve internal efficiency and better process data; second, it is to increase the ability to expand customers and systems and establish DAML tools.
Take AI applications as an example. It does not necessarily predict supply chain optimization and user growth, but can be used to improve user experience, because AI is better at processing a large amount of data, uses a large amount of data to generate high-dimensional features, and build a tool to use artificial intelligence to improve customer conversion rates.
