After more than a decade of evolution, China e-commerce is getting highly competitive. The operation complexity is increasing rapidly. And the battlefield of the ecommerce operation has changed from the simple focus of recruiting new customers to a comprehensive refined e-commerce operation.
The Era of Refined E-commerce Operation Management Has Now Come
In the Databank(数据银行) tool developed by Alibaba group, the consumer behaviors along with A-I-P-L journey are all become visible. Brands could clearly observe and track each consumer groups’ status in every stage. For example, brands can see how many consumers are currently in awareness stage, and develop targeted communication and sales tactics to better engage with these consumers and convert them into the next stage. By making such “tailored” approaches for every consumer, brands can enormously improve its communication efficiency and sales conversion rate.
By doing this, merchants can make sure that the right consumers will receive the right content. This logic is also in line with the traffic distribution of “personalized content” on Tmall and Taobao.
If a company wants to keep business growth and strengthen the market competitiveness in the e-commerce field, it requires its business capability upgrading and transformation. Since nowadays e-commerce success will fully rely on big data and artificial intelligence technology.
4 Prioritized Aspects to Drive E-commerce Growth
1. Comprehensive E-commerce Business Audit - Understand current e-commerce status and identify gaps for improvement
- Traffic structure (thereof the assessment of the paid traffic investment performance)
- Product structure (thereof the assessment of the performance of best sellers is focused)
- Online channels layout and business proportion structure
- Sales performance of major promotional activities
- Performance of other major aspects of operation (including sales conversion rate, customer price, customer service and member CRM mechanism, etc.)
- Industry & competitor performance
2. New Assortment Planning - Learn from the trends and competitions in the industry, develop and scout new products in line with the trend and cultivate the next sales opportunity
New products are becoming more and more important. They are strong driving forces for brands’ growth, particularly for new user’s recruitment. New user expansion formulates the base of a business growth.
In 2019, Tmall put forward new product launches as a major strategy:
- More than 100 million new products were launched from Tmall platform.
- “New Product” as keyword was searched 10 billion times within the Taobao app.
- Sales of new products from more than 500 brands exceeded 100 million RMB.
- The average research and development time of new products shortened from 2 years to 6 months.
In 2020, new products continued to be Tmall’s essential strategy: built 300 new products which sold more than 100 million RMB, and built 1000 brands with new product sales of more than 100 million RMB.
Identify new product competitiveness relies on the 4 core considerations:
- Well developed product concept which leads market & industry trends
- Keep updated on market leaders’ & key competitors’ activities for new products
- Sharpen product selling points to differentiate from the market
- Understand core target consumer insights and create resonant product stories.
3. New Sales Channel Expansion - Discover new sales channels and create more sales scenarios
As a result, O2O (online to offline) shopping grow rapidly. Using grocery shopping as an example, more and more consumer would now rather use an app to buy groceries instead of actually going to the market, or place an order through WeChat Mini program of the community store and have goods delivered in 30-60 minutes.
There are many other new sales channels have been developed along with the rapidly-growing online retail. To keep up with the market development, brands need to continuously discover new channels and create more sales scenarios that match with its positioning, target audience and product features.
4. New Marketing Methods Exploration
E-commerce shortens the traditional four stages of consumer behavior (A-I-P-L). The whole consumer journey could be completed in just one place and all at once. Internet has blurred the boundary between sales and marketing. Therefore, social commerce, which combines the characteristics of marketing and sales, gets more attention. One of the most phenomenal ones is live-streaming.
Nowadays, the popularity of live streaming is speedily rising. During the Double 11 in 2019, 15% of sales in the entire cosmetic category came from live-streaming. In the future, perhaps 50% of total sales on Tmall will come from live- streaming.
Live-streaming takes “shopping browsing” to the extreme. Anchors “feed” products to consumers directly through the camera, explaining the features and advantages of products ceaselessly, clearly and professionally. Live streaming brings higher trust and lowers the barriers of consumer´s decision-making.
Besides live streaming, short videos have gradually replaced photo and articles, and have become the unstoppable trend of consumer interactive experience on Taobao, Little Red Book, and other e-commerce and social platforms.
New marketing models, such as real-time interactive activities of TV programs on network media platforms, placement of brand’s advertisement into TV shows, are softening their commerciality. They are now challenging the traditional marketing concepts and methods, which the overseas brands are familiar with.
Nowadays, refined e-commerce operation model has become the inevitable requirement of business growth in e-commerce world. A refined e-commerce operation is based on big data and AR technology, with a thorough inspection and evaluation on operation, assortment, channels and marketing.
Relying on scientific and quantitative methods to run the e-commerce business and forecast its growth trajectory, a healthy and stable progression in the long term can be much secured.
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