After becoming popular, Oriental Selection opened up a new path, established its own brand and APP, and began to grow into a new force in Douyin e-commerce. But during this period, there have been controversy over Oriental’s selection. How should we take our time and embark on our own e-commerce path in the future?
People are still asking: Is the Oriental Selection after the popularity of the world a flash in the pan?
From a moldy peach to a corn priced at 6 yuan, Oriental selected from the popular 4 months ago, the controversy has never faded, but it has undoubtedly grown into a new force in Douyin e-commerce.
According to the distribution platform, Dongfang ranked first in the Douyin e-commerce live broadcast GMV ranking of live streaming on Douyin e-commerce in September. Due to the change of the platform's data statistics rules, the original precise data was changed to the range, with sales of RMB 500 million to RMB 750 million, ranking first for four consecutive months. According to Cicada Mama data, Oriental Selection Live Room now has 26.787 million fans, and its GMV in the past three months is 1 billion to 2.5 billion.
Optimists believe that the success of Oriental Selection has verified the feasibility of high-quality content. The era of "one-yuan cola" and "focus on sending cats and grabbing cups" have never returned, which in a sense marks the strategic direction of live e-commerce and even the entire retail e-commerce industry. Especially after Oriental Selection launched an independent APP, with the support of platform attributes, the attention to the transformation path of New Oriental has been once again increased.
According to the data of the APP big data service platform Cicada Master , the total cumulative download volume of the APP's Android channel is about 550,000.
, and some people are not concerned about their knowledge, whether it is the supply chain defects exposed by the moldy peaches and the brand recognition problem reflected in the 6 yuan corn dispute, before Oriental Selection solidly solves the supply chain, traffic source and platform positioning issues, it is still a popular myth artificially concocted, and its case value is far overestimated.
01 The so-called "escape" is just a premeditated plan by
Oriental's selection to launch an independent APP. It was once regarded as evidence of its "escape" on Douyin e-commerce, but the knife technique found that its action was not big, and it was more like a retreat "just in case".
Looking at the entire e-commerce live broadcast, the interest game between the platform and the super head has always been the main line of attention in the development of the industry. From the perspective of the platform, on the one hand, it is forced to support and even rely on the GMV contribution of live broadcasts due to the pressure of its own performance growth.
According to CITIC Securities , on Double 11 in 2021, Tmall GMV was about 540 billion yuan, of which live broadcast contributed about 30 billion to 40 billion yuan, accounting for 6%; while Viya and Li Jiaqi , the total GMV of the two "super heads" is as high as 20 billion to 30 billion yuan, accounting for 60% to 80% of the total flow of Taobao live broadcast in the same caliber.
On the other hand, the platform needs to balance the divergence of the super-head traffic "black hole" on its own supply chain control and the erosion of platform interests.
Previously, Huxiu author "Zhu Simaji" wrote: "The American ONE company has also received the visit of the Douyin e-commerce team. Byte has offered a guaranteed performance scale of 150% on Taobao. The number of Douyin fans is twice that of Alibaba . Taobao has only offered an undeniable condition for counter-counter: Taobao APP fixed the first-level entrance to Li Jiaqi's exclusive live broadcast room, and ensures the traffic of the above-mentioned first- and second-level entrances."
In the 1.0 stage of live e-commerce, the top anchor traffic has become the best and most stable exposure channel that new brands can choose within the same budget. New consumer brands have brought "5,000 Xiaohongshu notes + 2,000 Chapter Zhihu answer + Li Jiaqi/Viya's live broadcast room = new brand" and run around in the live broadcast room of the super heads.
However, for big brands that don’t worry about sales, the sales explosion brought by live streaming is only an advancement of daily sales for a period of time. In addition, the lowest discount for super-head anchors often breaks through the price line that the brand adheres to, and in the end, the big brands will find that live streaming becomes "making wedding dresses for others", allowing top anchors to gain traffic and bargaining power, while their customers are lost to the anchor’s live streaming room, and there is a higher probability of purchasing products from competitors in the same live streaming room.
In essence, the host of goods is neither a merchant nor a salesperson, but is more like a middleman, and a brand with marketing needs and budget is the real customer of the platform.
Super anchors dominate the whole family, and mid-level anchors cannot be exposed, and then they have no right to negotiate with the brand, thus forming a vicious cycle that is difficult to grow. The entire live broadcast ecosystem has become a Y-shaped ecosystem where small and medium-sized anchors, brands and platforms can accompany them, and only super anchors and winners take all.
Douyin obviously doesn't want to see this situation repeat itself. From Liu Genghong to Zhang, and even the older generation Gula K, the new top stars have led to social carnivals again and again, but in the Douyin traffic pool, we have always seen new people laugh and no old people cry.
According to Feigua data, as of October 11, 67% of the audience in the Oriental Select live broadcast room came from others, and Feigua's definition of "other" means that the audience mainly comes from the live broadcast square recommendation, which may include paid promotion traffic in the live broadcast room, which means that the lifeblood of the Oriental Select live broadcast room is actually still in the hands of the platform.
Douyin is good at "creating gods" and is also good at exileing "gods". Yu Minhong actually understands this very well.
"We don't pay attention to temporary excitement, but pay more attention to long-term development... The lively business model established by external platforms is very fragile. We still have a long way to go to lay a solid foundation for long-term development."
This is not the first time Yu Minhong's statement on Oriental's future business strategy in his personal public account "Lao Yu Gossip". Earlier on June 28, after Oriental Selection was released, he clearly stated in his article that Oriental Selection would build its own platform in the future.
(Photo source "Lao Yu Gossip")
actually launched an independent APP as early as April 7 this year. The registration time of WeChat mini program "Oriental Selection" of the same name was earlier and was completed on December 22, 2021.
(the App Store version record on the left, and the WeChat mini program registration time on the right)
Whether it is Yu Minhong's personal judgment or a series of actions that have been prepared, it is not difficult to find from the above review that this is a pre-provocative "escape".
Oriental Selection launches an independent APP. Why does Weiya and Li Jiaqi need to be private domains? It is essentially one and two sides of the same topic. Although the super leaders have different starting paths, sales positions and main categories, their actions after becoming super leaders are surprisingly consistent.
02 The end of live streaming sales is the supply chain
As early as November 2019, Li Jiaqi, as a partner of the American ONE company, said at the investors' annual meeting that he would do "e-commerce live streaming Costco". In the future, he will open a beauty store similar to Sephora offline, among which private brands will account for a large share.
Viya rented two full floors in Alibaba Building 1, Hangzhou to display supply chain pallets including jewelry, luggage, food, home appliances, mobile phones and even famous watches, and opened to other live broadcast companies for use. Earlier, Simba established the "Xinxuan·Singxinxuan" supply chain platform .
Make a Friend Founder Huang He once publicly reviewed the three stages of the supply chain in the live broadcast room. From waiting for others to "feed" in the first stage, waiting for the brand to come to the door; to the second stage, the company has added sub-vertical departments such as food and wine groups, digital groups, and daily necessities to discuss cooperation in the organizational structure, and then to the third stage, directly seeking supply chain cooperation, and with a mature organizational structure including product selection, business, market, finance, legal affairs and other departments, we can achieve a two-year transaction volume of more than 10 billion yuan.
The top anchors are on the one hand, the traffic appeal engine, and on the other hand, the strong supply chain engine. The platform may be able to suppress the former, but it will not affect the latter.
From the "noisy red ocean" that competes for consumer attention to the "immersed blue ocean" that layouts the supply chain ecosystem, the protagonist of the live e-commerce second half will undergo a transformation from front to back.
Obviously Oriental Selection has realized this. In order to avoid the incident of consumers reporting that peaches are moldy, rotten and hairy, Sun Dongxu, executive director and CEO of New Oriental Online , said that he would increase investment in supply chain construction in the future.
htmlOn August 31, Oriental Selection’s official Weibo post announced that it plans to establish 20 self-operated product warehouses in five cities: Beijing, Guangzhou, Hangzhou, Zhengzhou and Chengdu to provide nationwide logistics service guarantees for self-operated products. Warehousing and distribution services are provided by SF Express . htmlOn September 6, JD Logistics officially released the news that JD Logistics and Oriental Selection reached a cooperation. Oriental Selection uses JD Logistics , commercial flow logistics integrated supply chain solutions and logistics distribution network covering the whole country to realize the delivery of orders for self-operated products in the same city today or the next day, and cross-provincial orders can be delivered in 72 hours.Raw materials procurement, processing and distribution, the supply chain as a whole system, the most important thing is the chain. After solving the logistics problem, the mountain of agricultural products source procurement is waiting for Dongfang to select and solve.
"For several suppliers that cooperate with Oriental's self-operated brands, we are considering injecting capital into them, but they do not control the shares, and use capital injection to make a relatively stable layout and development."
New Oriental Online Executive Director Sun Dongxu at the 2022 fiscal year telephone performance meeting was exactly the same as what Yu Minhong mentioned in his personal official account - "Look for agricultural industry companies with high technology as the core, and participate in the form of investment or cooperation at the appropriate time."
03 Channels or industries to help farmers?
When Oriental Selection was first established, a large part of the reason why the industry was not optimistic was that Oriental Selection selected non-standard agricultural products.
The chain of traditional agricultural products circulation is "farmers - buyers from origin - wholesale markets from origin - sales vendors from sales - wholesale markets from supermarkets / vegetables - consumers". The products circulated on this long and fragile value chain are agricultural products with high-frequency urgent needs and low added unit value. This is a hell-level track. The most typical example is the fresh food e-commerce that has lost its doors after the glory of the past two years.
is followed by the problem of difficulty in branding agricultural products. Due to category reasons, agricultural products naturally have the problem of misalignment of supply and demand. Since the production cycle is longer than the demand fluctuation cycle, supply and demand matching is always in a dynamic balance process, so the prices of agricultural products have always been in a periodic fluctuation. The reason why
is controversial about whether 6 yuan corn is expensive is precisely because the price of Oriental selected agricultural products cannot be decoupled from the fluctuations in the market market . Consumers' awareness of the differences in their products is not enough to make them abandon price factors in the process of consumer decision-making, and brand power construction has not yet been completed.
But agricultural product price anchorage is essentially another act of confrontation with the market.
Because the fluctuations in agricultural products are determined by their supply (it is always in the long run, the upstream feed and chemical (fertilizer raw materials) are all cyclical industries. When the above-mentioned raw material costs account for a high proportion, the production cost of agricultural products is always in a dynamic process, anchoring the terminal sales price means that the loss risk caused by upstream cost fluctuations is borne by the brand unless the price is extremely high, but this will compress its target consumer group to a very small extent.
non-standard, loss, gross profit, fulfillment, and sales time. These five difficulties objectively limit the branding development of agriculture, but the difficulty is high, which also means that the digital space in the agricultural field is huge. Unlike the red ocean market of standardized products, it is still a blue ocean.
If Oriental Select can take a low-cost and replicable path in the construction of the compound agricultural industry ecosystem in order agriculture , the construction of the complex agricultural industry ecosystem, return to the bottom of the industrial structure, enrich the primary, secondary and tertiary industrial structure of agriculture, and allow primary agricultural products, secondary processing products, and fine-processed products to be their own, rather than just providing a channel for dumping agricultural products, then building your own moat will complete the real half.
04 Take your time, faster
is half the reality because the formula for the brand is product + consumer. Products are placed on the desktop, while brands are found in the minds of customers.
Among the hot reasons for Oriental Selection, emotional resonance has become an undeniable important reason. Consumers gathered into the live broadcast room with projection and resonance of New Oriental's emotions, aesthetics and approval of talent and culture.
The purchasing behavior of consumers does not come entirely from recognition of product quality, but temporary self-addition to a layer of emotional value and cultural identity. How to transform this aggressive consumer enthusiasm into long-term trust and favor for enterprises and brands, and then from internet celebrities to long-term popularity, replicating the success of Douyin live broadcast room to its own e-commerce platform, rather than being limited to live broadcast room or individual platform, is still a problem facing the Oriental Selection team.
If New Oriental Online wants Oriental to become an "e-commerce platform for high-quality agriculture and other products in China", it can be simply understood as a "vertical e-commerce platform". Compared with Mogujie , Jumei Youpin , and Secoo, although Oriental Selection is lucky, it still has to face the Matthew effect in the e-commerce field. The living space of vertical e-commerce is increasingly being squeezed by the market structure squeezed by the leading comprehensive e-commerce platforms.
At present, the Oriental Selection APP is still in its prototype state and cannot be the base for the long-term traffic of the live broadcast room when the broadcast is suspended. There is no obvious difference between the Douyin store and WeChat mini-program in terms of SKU quantity, price and products.
(the price of Oriental Selection APP on the left is the price of Douyin store on the right)
And what’s interesting is that the consumer data in the Oriental Selection independent APP and Oriental Selection mini program are the same.
(as shown in the figure, the number and content of the APP and mini program are the same)
Perhaps these have shown the current attitude of the Oriental Selection team, and they occupy a place in advance, but there is no rush.
As for what the future is, Yu Minhong has long said, "The popularity of Oriental selection will gradually decline and become a normal platform. The thing to do is to let it develop step by step."
Reference:
- Caixin Weekly, "How can Taobao reshape the live broadcast ecosystem after losing its "super head"? 》, 2022-09-06.
- Lao Yu’s gossip, "Lao Yu’s gossip | Life and death dependence is the most sincere relationship between mankind! 》, 2022-08-15.
- Lao Yu’s gossip, "Lao Yu’s gossip | Traveling in time! 》, 2022-06-28.
- Ran Dimension, "Oriental Selection "Oriental Work", Can it be possible? 》, 2022-08-27.
- "New Oriental Online 2022 Annual Report". https://m.koolearn.hk/#/investor
- Insighthub Insight Laboratory, "Where is the turning point of agricultural product branding? 》, 2021-04-13.
- CCTV Agriculture, "About Corn, What Must Say", 2022-09-28.
Original title: Escape from Douyin? Profitable sales? Oriental Selects the Controversial 4 Months
Author: Guan Cong, Editor: Mozhi
Source Public Account: Swordsman Research Institute (ID: DigipontClub), Insight into new consumption, empower new brands, analyze new marketing, and achieve good Chinese brands.
This article is authorized by the cooperative media of the product manager of the Renren is a product manager @大学发站. Reproduction is prohibited without permission.
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The views in this article only represent the author himself, and everyone is a product manager platform only provides information storage space services.
