Top survival rules of Douyin (Tik-Tok) e-commerce in China in 2020 (Part 2/4)

The Short video and live broadcast e-commerce have gain popularity in 2019 in China, and this pandemic seems to have added firewood under the boiling water. More and more ordinary people, KOL and small merchants have joined the “content e-commerce” in the tide, “Dai Huo (Carrying goods to the customer)” has increasingly become a national movement.

Is this trending going to present new opportunities for you? Are you also a player on the Dai Huo track? If you are one of them, have you mastered the skills and methods of choosing Douyin (Tik-Tok) selection products and making short video e-commerce content? In addition to the regular content Dai Huo, what other alternatives to Douyin e-commerce? We will answer you in detail with four posts, and this is Part 2/4.

Know the “Best selling products” on Douyin

By tracking over 430,000 product information, it was found that 74% of the products came from Taobao with an average of about 10 SKUs per store, 21% of the products came from Douyin, and 5% of the products came from JD, Koala, Suning, and other e-commerce platforms.

It seems that Taobao is still the most extensive channel in Douyin. We have learned that there are about 33,000 Taobao stores are doing e-commerce on Douyin, and the number of Taobao stores in 2018 has reached 110,000. This structure that Taobao’s goods sales on Douyin still belongs to the blue ocean and Taobao sellers with their supply chain channels can accelerate their efforts to Douyin.

Douyin is also constantly standardizing and improving its e-commerce system, including the online Douyin store rating system and the product sharing author rating system.

Judging from the product categories of Douyin short video with goods, the three types of boutique women’s clothing, make-up and personal care and food and beverage are ranked in the top 3 positions. From the perspective of content creation, the female perspective is also a better choice.

Next, let’s look at the prices. As the figure is shown below, about 85% of the products in the Douyin are within 200 yuan. 200 yuan is the brake line for Douyin users to consume goods on the platform. Therefore, when we do the price, we need to try to guarantee the products within 200 yuan.

Of course, the sales of the product also depending on the user’s understanding of product attributes, the price sensitivity of the product and the efficiency of product decision-making.

For example, the price of the iPhone is almost transparent, and it’s also a typical standard product. If you can get a price lower than the double 11 or 618 (Black Fridays in China), it is also worked on Douyin.

Having seen the price distribution, let’s look at the commission distribution.

Through the analysis of over 430,000 product information, we found that 41.86% of the products have set commissions. Through celebrities or amateurs to sale have become the normal state of Douyin. For brands or manufacturers, setting a specific commission rate is more conducive to the sale of products on Douyin and the commissions are used to attract spontaneous or celebrities to purchase and sell spontaneously. Then the products could be seen by more people. Exposure gets high conversion.

Under different commission rates, product categories and gameplay are also very different.

When the commission is in the range of 0.01-10%, most of the products are Chinese beauty brands with brand power. Such brands have sufficient market budgets. They can use high-selling strategies to capture a batch of head and shoulder KOLs. By high-quality content to ensure a specific explosion rate and to create a “popular” atmosphere. Then attract a large number of waist and tail accounts for distribution.

When the commission is in the range of 10.01% -30%, the products typically are mostly cost-effective household commodities. It’s also suitable for people who lack the budget and need to be in Douyin e-commerce. These products have low purchase costs and broad market demand. As long as there is a specific product selection strategy, it is not difficult to make some explosions in this range.

In the range of 30% -60%, products are mostly start-up brands and mainly cosmetics. The characteristic is high gross profit. This type of seller is often divided into two categories. The first category is Taobao e-commerce seller. By giving up some margin to create high customer orders through Douyin and increasing the weight of products to harvest more profit. The other category is players who made a profit and go. They are not responsible to the output content. They follow the trend to make quick money. However, with more control from Douyin, there will be less such players on Douyin in the future.

From the perspective of the commission rate, it’s a bit like a game between merchants and Douyin. KOL and KOC are unwilling to sell the product with low commission, and manufacturers can not get profits with high commission. Therefore, we recommend that the commissions could be at 10% -30%, which is a reasonable range (except for individual categories).

The above gives us a general understanding of the situation of Douyin e-commerce from goods, channels to commissions. Next, we will talk about how to select products and create sales scenarios. We found that there are four factors that would affect whether a product is natural to sale:

1. The user’s understanding of the product

It can be simply understood as whether the users know the purpose, value, and price of this product.

Taking the iPhone as an example, users have their subjective evaluation of this kind of product. Unless there is a great price advantage, it is difficult to become an explosive product. So, brands and merchants of this kind of products should not expect to make sales on Douyin.

For some new and peculiar products, users’ subjective perception of the product is relatively vague, and it is accessible to exposure and sale on Douyin. For example, the Totwoo’s couple induction bracelet has obtained decent sales and exposure on Douyin.

2. The user’s decision-making efficiency

The two significant factors that affect the ability of decision-making are consumption frequency and price sensitivity. Which means whether it is a large number of commodities in life or high consumption frequency and whether the price of the product allows users to easily place orders without hesitation.

3. The heat of the product

There will be some differences between Douyin and Taobao. And it is also based on Douyin’s algorithm mechanism and media attributes. Explosion means topics and topics means traffic. The direction of the manufacturer is to create a question, and the course of the Douyin’s KOL is to rub the problem. For example, adopting a cow as a dairy brand and inviting Tu Lei to take delivery of the video on the Douyin Goods List for a week. Such a product immediately drove 60 KOL shipments and sales reached 30,000.

4. Margin

For brands, it is to measure the ratio of investment to output. For KOLs, it is necessary to look at the commission. Of course, it shouldn’t just take the commission theory. It is not a good idea to sale things that do not meet the tone and content style of their account.

After talking about the products, let’s take a look at the scene, for short videos which for selling, the scene gives the product value in the video. Usually, people will limit their thinking to the scene, but it is difficult to attract users to stay and watch this in addition to the novelty.

Don’t limit your thinking to use scenarios. Trading, experience, evaluation and even emotions can all be scenarios of sale.

To the experience scene, it isn’t easy to impress the audience by simply holding the product and displaying it. And the use of the scene is more biased towards elaborating and preaching content, and the feeling of empathy is inferior. Therefore, to maximize the personal experience is the only way to close to the audience and enhance the sense of substitution.

For example, @可爱的QQ呀got swift followers’ growth in the past. And the content is very focused on strengthening the product experience scene to inspire users to place orders with empathy.

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