Alibaba 1688 President Yu Yong
Recently, I went to Shenzhen to attend a gift exhibition. When the plane landed in the early morning, I felt a little moved when I saw the brightly lit Shenzhen.
I haven't had the word "buzzing" in my mind for a long time, but when I arrived in Shenzhen, I felt the fireworks. A customer told me that the current situation is better than expected, and God follows people's wishes. During the exhibition, I saw from the vitality and enthusiasm of small and medium-sized enterprises, the warmth of the basic economic foundation is constantly accumulating. Under the warmth, what are the new business opportunities after the epidemic? This is a question I have been thinking about recently.
(I) Economic Warmth
From the data of 1688, you can see the steaming recovery trend.
In the past year, the customer renewal rate of 1688 has not fallen but rises. In the past few waves of the epidemic, our traffic, number of buyers, conversion rate, and transaction volume, have all been rising rapidly. Many customers show a kind of commercial "immunity". 1688's customers are more dynamic, more willing to make trouble, better understand buyers, and more down-to-earth. These businessmen have significantly better physical fitness than the entire economic market.
Under the impact of the epidemic, customers are increasingly aware that it is not that they need to move their business online after the epidemic, but that online and offline businesses are rapidly integrating. Buyers of
1688 include Class B and Class C. Class B will be distributed after procurement, while Class C will be used for its own use. Now, the boundaries between B and C, online and offline, cross-border and domestic sales, consumer Internet and industrial Internet are all blurred.
This brings new opportunities. For example, C-type buyers who use it start purchasing in the form of B. The one who is best at buying is college girls. She will collect the needs of the entire dormitory to purchase in batches, which may affect the girls on the entire first floor. Under the epidemic, residents of some communities have changed from personal procurement to group purchases and mixed batching on behalf of communities. For example, a newly married woman may spend 40,000 to 50,000 yuan on 1,688 for 200,000 yuan on decoration fees. The anchors and group leaders who have emerged in recent years have also poured into 1688 to purchase. The business boundaries between
B and C are constantly broken. Some factories do not make small orders, but behind a small order may be large customers. Even if it is not a large customer, 10 small customers are also large orders. Class C is a stronger demand, more controllable and stable. The key is whether you have the ability to have a flexible supply chain.
(II) Turn crisis into opportunity
Generally, the large economic cycle is 60 years, the medium cycle is 10 years, and the short cycle is about 34-40 months, which is repeated over and over again. You think the economy is a bad one and think the epidemic is a "black swan" event, but in fact, the medium cycle will occur every 10 years. The most direct reflection of small cycles is inventory. When it’s good, everyone is adding production capacity . When encountering small cycles, inventory will be backlogged. The most typical small cycle is the pig farming industry.
The key to counter-cyclical growth is to see opportunities in danger and turn crises into opportunities. What are the next opportunities?
The first is home economy. More and more people are willing to be alone. It turns out that we think lightly, and what we see with the naked eye is the rapid growth of pet economy and pet toys. But thinking about it further, there are actually many opportunities when you are alone.
The second is the self-pleasing economy, especially for women, the self-pleasing economy is becoming more and more prosperous. Whether it is a Class B buyer or a Class C individual buyer, there are more and more purchases of gifts. B also sold it to C after purchasing.
The third is the health economy and the camping economy, which is a very obvious trend.
(III) Buyers of younger and more feminine
1688 show the characteristics of younger and more feminine.
Our buyers are getting younger and younger, and the average age of buyers is decreasing by 2-3 years each year.
There are 10 million college graduates this year, and the employment pressure is high. Many graduates choose to use 1688 to find flexible employment and start businesses. We have a buyer who wholesales mosquito repellent water at 1688. The single piece starts from 0.8 yuan, and the wholesale price of 2,000 pieces is 0.75 yuan. He got it at the entrance of the park and sold it for 5 yuan. He sold 700 pieces a day, and made a net profit of more than 3,000 yuan a day.
1688 The most typical buyers are small bosses, small female entrepreneurs, company procurement and finance, young mothers, female college students, and anchors on almost all e-commerce platforms. They looked for it on Xiaohongshu and then bought it at 1688. There are 1.68 million self-produced content posts on 1688 on the entire Xiaohong Book.
We unexpectedly became the most popular shopping app in girls' dormitories, and behind this is the rise of domestic products. The affordable and easy-to-use white brand peace substitute is very popular. These female students value whether the product they like, whether it has quality and personality, whether it meets their inner mental labels, and that it is cheap, and they will show off to others after buying it. If her mother said this was a factory product, she would retort that the quality was similar to the big brands her mother used, and the price was only one tenth, and she felt it was cool and happy. This is a new consumption concept. These treasure girls are looking for treasure shops and treasure factories on Xiaohongshu and B station. New demands have given birth to a number of treasure factories. Many of the factory managers are second-generation or even third-generation factories, most of whom are "post-95s" or even "post-00s".
(IV) The understanding of needs determines the business imagination
How deep your understanding of needs determines the difference between your future business and others.
A buyer visited the gift exhibition of 1688 for three days. Finally, he could form a few plates of goods in his mind, which ones were sold to schools and which ones were sold to the community. This created a new business scenario. The gift customization transactions on
1688 are growing rapidly. This is a trillion-level consumer market with an annual growth rate of 10%. It turned out that I gave gifts several times a year, but now it is 365 days and there are reasons to give gifts. If you are in a good mood, you should give gifts, and if you are in a bad mood, you should give gifts. Take me as an example. At least dozens of relatives and friends who need strong maintenance every year. If someone can provide a plan for the gift time and gift list for the whole year, and different people give different gift plans, they can take a customized order from me.
In the past, we looked for demand according to supply, and today we should design supply according to demand. We classify according to demand and then create supply scenarios one by one. If customers follow this, they are already ahead of 90% of their peers.
(V) Equality and Resilience
Every year, 50 million pay buyers to purchase at 1688, and 1 million merchants do business on it. We hope to become the infrastructure for everyone to do business.
It turns out that the value of 1688 is information equality and channel equality, followed by supply chain equality, product option equality, downstream data analysis equality, allowing customers who are granted one and 10,000 to be granted equality in service standards and performance guarantees. The big anchors with the top
can build their own supply chains. We focus on serving small and medium-sized anchors, small and medium group leaders, and small and medium entrepreneurs, and they are the majority. There are many factories on
1688. The products are very good, but they are not good at serving buyers. Sometimes they don’t pay much attention to small buyers. They respond slowly and do not understand online operations, which leads to poor purchasing experience for buyers. We hope to help factories improve their capabilities so that they can go from being able to accept large orders and only wanting to accept large orders to being willing to accept small orders and being able to make money.
In fact, small orders are trends. Not only does profit high, it can also directly contact buyers and capture the latest market demand, so that the factory's products have vitality and competitiveness.
For traders, they originally made a profit of the difference, and they least wanted "equal rights" and made an opaque money. It is best to have an opaque time, price and information. But today, traders have no future as middlemen. If you want to be a service provider, you should be a group of goods.
So 1688 hopes to become the infrastructure for everyone to do business, rather than an online wholesale channel. In the past, customers needed to recruit people to solve problems, find resources outside to solve, and spend money to solve problems. After passing equal rights, they just need to focus on doing their most important things.
I have a creed, being an optimistic long-termist, I believe in the resilience of the Chinese economy, and this resilience is small and medium-sized enterprises.
(This article was compiled by "Finance" reporter Yang Liyun based on the speech of 1688 President Yu Yong at the 30th Shenzhen Gift Exhibition and 1688 Factory Direct Purchase Season on June 15.)
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