The next question of live broadcast e-commerce, Tiktok or Taobao? Multiple Choice Questions for Oriental Selection

At 5:30 pm on August 29th, Yu Minhong made an appearance in the Oriental Selection live broadcast room, personally promoting 5 products and then spreading good news - the daily sales of the live broadcast room exceeded 100 million yuan.

In the live streaming market where traffic and sales are deeply tied, top anchors no longer rely solely on traffic rewards from live streaming platforms, but share business risks through multi platform operations and build their own supply chains to compete for dominance. The competition between platforms and anchors is gradually changing the game rules of live streaming e-commerce.

Separate and open "eggs"

Unlike the common "late eight slots", Dongfang Zhenxuan starts broadcasting early at 8am. Even during such a niche live broadcast period, the combination of ultra-low prices and high popularity has made Dongfang Zhenxuan's Taobao debut very impressive. At around 6 pm, the sales revenue had exceeded 100 million yuan, with nearly 1.2 million followers. At the same time, the number of online viewers continued to exceed 100000, with a total of over 10 million views. In contrast, the number of people online in the Tiktok studio of Orient Select is only more than 8000, and the number of people online in Orient Select App is about 2000.

Although it may seem like it turned red overnight, the signs of Dongfang Zhenxuan entering Taobao have been around for a long time.

To some extent, Dongfang Zhenxuan belongs to the "Dou Brand" camp. Influenced by the "double reduction policy" in 2021, New Oriental's K12 business suffered a major change and chose the live track. At the end of December of that year, Yu Minhong's "second venture" project, Oriental Selection, started on Tiktok, quickly became bigger and stronger in half a year. At present, the number of fans on the platform has exceeded 40 million.

The "honeymoon period" of Orient Selection and Tiktok lasted less than a year. Yu Minhong once talked about channel anxiety on his WeChat official account: "The busy business model built on an external platform is very fragile." Therefore, Yu Minhong also accelerated the establishment of an independent e-commerce channel - Orient Selection App.

The time came to July 26 this year. Due to the rule of Tiktok, the live broadcast room of "Oriental Selection of Self operated Products" suddenly stopped broadcasting in the afternoon and did not rebroadcast until August 1, which once attracted widespread attention in the market. However, the suspension incident was a blessing in disguise for Dongfang Zhenxuan. Within four days, the sales of Dongfang Zhenxuan App exceeded 110 million yuan, which is particularly difficult for self built channels.

With the landing of Taobao live broadcast, Dongfang Selection also gathered three live broadcast positions, namely Tiktok, Taobao and self run App, and completely said goodbye to the embarrassing situation of "eggs in one basket".

Dongfang Zhenxuan Taobao Live Room

Taobao has accumulated numerous domestic and international major brands over the years, strong supply chain resources, and the ability to expand across all categories. The massive number of users will also become the new basic platform for Oriental Selection. "In addition to Tiktok, the customer base selected by Dongfang should not be underestimated. The success of proprietary apps is an example, and their customer base also includes many middle and high-end people, who are expected to achieve good results after entering Taobao." Cui Lili, executive director of the E-commerce Research Institute of Shanghai University of Finance and Economics, said.

The game rules have changed

At the beginning of the brutal growth of live broadcast e-commerce, the head anchor was highly bound to the live broadcast platform, and each live broadcast platform supported one or two "super IPs", such as Li Jiaqi on Taobao, Luo Yonghao on Tiktok, Simba on Kwai

Taking Li Jiaqi's live streaming room as an example, from "lipstick leader" to "live streaming leader", Li Jiaqi's success cannot be separated from the resources of Taobao. According to media reports, during the flourishing of live streaming in 2020, Li Jiaqi occupied the first level entrance of Taobao's fixed exclusive live streaming room, while also promising to tilt the traffic of the first and second levels. In return, Li Jiaqi has attracted more small and medium-sized anchors to join Taobao through her own influence, and the GMV of Taobao Live has also been continuously reaching new highs. According to data, Li Jiaqi's live streaming room accounted for 57% of the pre-sale sales of Tmall's 618 beauty category this year, highlighting the influence of top anchors.

The symbiotic relationship between anchors and platforms is a guarantee in the growth stage, but becomes a shackle in the maturity stage. Whether it's Luo Yonghao's "Make Friends" or Yu Minhong's "Oriental Selection", the presence of top anchors with a strong sense of tag is decreasing, which is the result of continuous competition between top anchors and platforms.

Taking Dongfang Zhenxuan as an example, third-party testing agency Grey Porpoise data shows that from May to July this year, Dongfang Zhenxuan's daily sales, total daily viewership, and comprehensive conversion rate decreased month by month. Especially in July, the daily sales were only 11.7 million yuan, a year-on-year drop of 47% and a month on month decrease of 21%. This also means that Dongfang Select has passed the period of strong dividend flow in the Tiktok live broadcast room, and is facing the pressure of decreasing user novelty and Tiktok push.

That is to say, the live streaming mechanism of bundled traffic sales has shaken the win-win cooperation between broadcasters and platforms. Top broadcasters are increasingly frequent "cross platform", and multi-channel layout and traffic flow have become the best choice for live streaming e-commerce to combat "traffic anxiety".

Qi Er, the assistant broadcaster of Weiya, Taobao's "Queen of Goods", left Taobao last May to broadcast live in Tiktok, which also achieved a record of "daily sales exceeding 100 million yuan"; Qianxun Holding's Bee Surprise Club was broadcast live on Taobao, while the "sister" Dolphin Surprise Club was broadcast live on Tiktok; Not to mention that Luo Yonghao's "Make a Friend" has long been the representative of Tiktok Taobao's "Shuangqi" live studio. Another Tiktok network celebrities, such as Li Xiaoshazi, Da Zui Mei, Zhu once, have settled in Taobao live broadcast, and have achieved good results.

The first financial report disclosed by "Make Friends" after its backdoor listing showed that as of June 30, its live streaming rooms had a GMV of over 5 billion yuan across the entire network, and the growth was mainly attributed to cross platform operations: "We have created high-quality live streaming e-commerce and new media marketing channel brands, and successfully achieved cross platform operations, resulting in rapid growth in the overall business operation and financial performance of the group.".

Completing Shortcomings Becomes Key

Taobao, Tiktok, Kwai and other live broadcast platforms compete. The head anchor seems to be able to reap the benefits, but without the backing of independent broadcast, how to make up for their own shortcomings has become a key factor.

From the perspective of the industry trend, it is an undeniable fact that the growth rate of live streaming e-commerce has slowed down. According to Cicada Mama, in the first half of this year, the number of likes, bullet screens and fans added in Tiktok e-commerce live broadcast decreased by 29.6%, 18.5% and 25.0% respectively year on year, and the average number of goods in the live broadcast room decreased from 25.3 to 21.2, a decline of 16.2%.

Faced with the peak traffic situation, live streaming platforms have to reduce the weight of top anchors and support more small and medium-sized anchors to enrich their business formats.

A person in charge of e-commerce told reporters that an ecologically prosperous e-commerce live stream should be like a bustling street with a bustling traffic, with professional big shops and small roadside stalls, as well as playing dragon and lion dances and acrobatic performances. "Small sellers who learn to sing and talk may not directly generate large-scale transaction flow, but the lively atmosphere will attract more people to stop and stay, and the entire platform will be bustling."

"Live streaming platforms require top anchors to attract traffic, but if the anchors are too strong, it will affect and restrict the platform's autonomy." Cui Lili said that top anchors are like an IP with user stickiness, and once the consumer group is locked in, the importance of the platform will be reduced. For example, many users selected by Dongfang have become fans of Dong Yuhui. No matter whether they are on Tiktok Live or on App, fans will follow Dong Yuhui.

Although live streaming sales on major platforms tend to be similar, the differences in underlying framework logic among platforms also increase the difficulty of "job hopping" for top anchors.

"Taobao Live is mainly about commodity or store logic, while Tiktok Live is mainly about content logic. Taobao Live is more about the ecology of commodity supply chain, and Tiktok is more about the ecology of content production." Cui Lili believes that the focus of the two is different, and the anchor cannot copy the original business model when changing platforms.

Take Dongfang Selection as an example. At first, Tiktok Live Studio was famous for its knowledge output, creating a batch of strong humanistic IPs such as Dong Yuhui, while Taobao Live Studio is more like a "shopping mall", with high requirements on cost performance and slow pace of "knowledge point" selling mode. Therefore, Dongfang Selection has accelerated the efficiency of speaking products. Sun Dongxu, CEO of Dongfang Selection, also said that no matter Tiktok, Taobao or other platforms, there are obvious differences in user groups, user profiles and advantages of each platform, so coordination and balanced planning between platforms is needed.

Without the support of independent broadcasting platforms, top anchors have begun to explore upstream industrial chains and accelerate the pace of self operated goods and supply chains.

At the beginning of this year, Dongfang Zhenxuan invested over ten million yuan to expand its self operated sausage factory, entering the upstream of the supply chain. Sausage is currently the flagship self operated product selected by Dongfang Selection, with a cumulative sales volume of over 112 million pieces and a revenue of over 300 million yuan. In addition, the emergence of self owned brands such as HOLAX under Xinxuan Group and Fengweipai under Qianxun has also become one of the confidence for top anchors and platforms to challenge. Yuanwang Technology also stated in its financial report that it strives to create a unique Yuanwang model in the field of live streaming e-commerce supply chain, and the company's strategy extends from an IP operation platform to a supply chain platform.