How can brands crack the problem of “private domain traffic”?

A few months ago, when I was chatting with an investor in my circle of friends, I asked him, "What is the hottest track at the moment? Which field is the hot spot for investment?" He replied, "It is better to invest in new consumption than in the Internet."

From the perspective of front-line practitioners, in the past 2020, a new generation of consumer brands such as Pop Mart, Yuanqi Forest, Zihaiguo, and Perfect Diary ushered in explosive growth, and the primary market officially entered the "first year of China's new consumer investment."

As we enter 2021, the heat of the consumer industry has not faded. Data shows that there were 280 financing events in the new consumption sector in the first half of 2021, with a total financing amount of more than 39 billion yuan, far exceeding the same period last year.

New consumption has undoubtedly become one of the hottest investment areas nowadays, attracting the most hot money and adventurers.

Today, the wave is unstoppable. Among them, new consumer brands include newly established brands as well as traditional brands. New brands are rising in mature categories with differentiation, segmentation and regionalization strategies, while traditional brands are seizing new consumption opportunities through digital transformation.

What is certain is that, whether it is an emerging brand or a traditional brand, in this new consumption wave, diversified marketing methods are the "heroes" behind the rise of the brand.

However, under the repeated bombardment of marketing methods such as short video information streams and live streaming, users have gradually shown a certain aesthetic fatigue. At this time, how brands establish an "effective connection" with users has become the focus of the brand's digital marketing layout.

In this context, "private domain traffic" becomes the key to improving marketing efficiency.

On October 13, 2021, WeMall Group released the "2021 New Consumption—Brand Full-Link Intelligent Growth Report" (hereinafter referred to as the "WeMall Report"). As China's leading enterprise cloud business and marketing solution provider, WeMall has many years of service experience in private domain operations.

Through this report, we try to explore how new consumer brands will break through with the rise of private domain marketing?

01 Private domain becomes the core growth driver of brands

At this stage, although new consumption has become a cliché, the internal logic behind its popularity still cannot be separated from the concept of consumption upgrading.

Data shows that China's new consumption development has grown rapidly since 2018. In 2019, the market share of Chinese brands reached 72%. In 2020, the penetration rate of Chinese brands reached 91.4%, making it the first year of the explosion of new consumer brands.

The reason why it broke out in 2020 was related to factors such as the domestic per capita GDP exceeding US$10,000 at that time, the maturity of related infrastructure construction, and the native generation of mobile Internet becoming the new generation of mainstream consumer groups in the market. These characteristics together created the popularity of "new consumption".

In the "WeMall Report", new consumption is defined as: new business models such as new digital marketing technologies, integrated multi-channel technologies, and user consumption patterns in new marketing scenarios based on social networks and new media.

In essence, new consumer brands will inevitably provide new product categories or iterate and upgrade old categories. As defined in the report, the application of new marketing technologies or marketing concepts is a major feature of new consumption.

In the marketing process, looking at the successfully emerging new consumer brands, some have successfully leveraged abundant public channels and content dividends to quickly explode among new consumer groups and embark on a scale-up route; others have taken a different approach and obtained higher brand premiums by penetrating the minds of private users.

The two path models are different, but today, the private domain awareness of new consumer brands is gradually awakening. According to a questionnaire survey conducted by WeMall Research Institute, 45% of brands’ online marketing efforts are aimed at building private domain traffic, starting from the end in mind, which reflects that private domain operations are becoming a favorite of brands.

There are various reasons for this change, which can be roughly classified into endogenous and exogenous factors. In terms of exogenous factors, it is related to the fading of traffic dividends and the increase in customer acquisition costs.

At this stage, the Internet dividend is fading and the traffic growth rate is slowing down. According to QuestMobile's 2021 China Mobile Internet Spring Report, the overall increase in the scale of monthly active users of China's mobile Internet was 10% from March 2017 to March 2019, while the overall increase from 2019 to 2021 dropped to 2%.

On the other hand, the cost of acquiring customers in the public domain is increasing.

The GroupM Think Tank report "Forecast and Response to Media Price Increases in 2021" shows that the influence of various factors will lead to an increase in media prices in 2021, with the upward fluctuation range of prices reaching as high as 38%.

Similarly, taking the traditional channel centralized e-commerce platform as an example, it is estimated that the increase in customer acquisition costs of centralized e-commerce platforms has made public domain traffic increasingly expensive, and the economic burden passed on to merchants has increased. For brands, continuing to spend money to purchase public domain traffic is a bit like "drinking poison to quench thirst".

Under multiple exogenous factors, many brands have turned their attention to the private domain.

As for endogenous factors, it is related to the brand's demand for refined user operations and the vision of breaking through growth bottlenecks.

The "WeMall Report" mentioned that in the new consumption environment, brand investment has shifted from the mindset of achieving "high exposure" to a greater emphasis on conversion results. Taking the "retail and e-commerce" industries as an example, according to WeMall's own data, the scale of their performance advertising accounts for 83% and 92% respectively.

The shift in delivery strategy reflects the brand’s tendency to achieve “effective connection”, which is also the disadvantage of public domain marketing. Due to the information acquisition methods, communication channels and algorithm logic of representative public domain traffic platforms, the platforms have weak control over merchants, and therefore user loyalty is low.

In addition, private domain marketing can achieve refined user operations and make the user pool more brand-sticky. Taking many factors into consideration, in the new consumption scenario, private domain operations are becoming the core growth driver of brand smart marketing.

In short, after experiencing the private domain explosion in 2020, private domain marketing is no longer a "test the waters" project for most new consumer brands, but has become a "necessary" choice in marketing.

02 Grasp the key role in private domain marketing

What is private domain traffic marketing? That is, the organizational function or means of achieving product or service delivery and increasing brand revenue by directing users to private domains, meeting user needs, and operating user relationships.

At this stage, the private domain marketing industry chain mainly includes: brands with private domain layout and growth needs; traffic platforms that provide public domain traffic foundation; service providers with rich service scenarios, including private domain website building, customer operations and other roles.

Take the traffic platform as an example. It plays two core roles in the marketing industry chain, namely, traffic carrier and development ecosystem provider: the platform is the main battlefield for brands to acquire customers in the public domain; the platform has a mature business model and is also the maker of ecological rules.

Currently, when it comes to choosing a traffic platform, 93.3% of brands choose WeChat for private domain marketing.

Although this is related to the excellent ROI of the WeChat ecosystem, the "WeMall Report" mentioned that during the period when brands placed advertisements in the WeChat ecosystem, the ROI increased day by day, increasing by 25% in 15 days, 47% in 30 days, and 67% in 60 days.

In addition to ROI, in fact, the evolution history of private domain traffic was originally based on the WeChat ecosystem. Since the emergence of WeChat and then becoming a national APP, its continuous introduction of new functions has gradually expanded the boundaries of private domain traffic and provided a complete infrastructure for private domain traffic.

Taking the emerging cosmetics brand Hua Xizi as an example, it provides customer service through the corporate WeChat account "Hua Xiaoxi"; publishes makeup tips, brand advertisements, product introductions and other content on the video account with a link to the official account; and provides mall and member daily activity points redemption coin activities in the mini program; thereby opening up public domain traffic and realizing private domain conversion.

After selecting a traffic platform, brands also need to choose a suitable service provider based on ROI.

Referring to private domain GMV = private domain traffic × conversion rate × average order value × repurchase frequency, analysis shows that the choice of service provider plays a key role in the effectiveness of the brand's private domain marketing (traffic, conversion rate, and repurchase frequency).

From the brand's perspective, service providers cover a wide range of functions, including customer acquisition, operation, conversion, fission, and review. They also provide brand owners with support and guarantee services such as user resource protection, online risk prevention, and agency operation.

According to the survey results of third-party brands, at the support and guarantee level, service providers focus on empowering "user resource protection", and at the conversion link level, service providers help brand owners focus on solving the problem of data visualization management.

At this stage, we are in the 2.0 era of new consumption growth. Brand marketing has gradually shifted from extensive operations that only focus on single conversions to refined operations that pay more attention to user retention and continuous operations. These changes have put forward higher requirements for service providers on the basis of refined operations.

Previously, in response to brand advertising demand, a number of technology and content service providers emerged in the market. Taking WeMall as an example, in 2020, WeMall proposed the "TSO full-link intelligent growth solution", where T stands for Traffic, S stands for SaaS, and O stands for Operation.

The introduction of this solution means that WeMall will no longer just provide support to brands in a single link, but will empower traffic acquisition, SaaS services and private domain operations through three major capabilities: digital marketing, digital systems and digital operations.

In response to the needs of the above-mentioned brands, WeMall will, on the basis of helping brands to refine their operations, assist them in forming their own full-link strategies through TSO, assist enterprises in building a full-link marketing closed loop, and achieve growth in private domain business.

03 Brand Breakthrough Points and Future Trends

Here, we have reached a consensus that public domain traffic and private domain operations are the key to marketing growth for brands. However, for brands, at the implementation level, there are pain points and difficulties to varying degrees in both public domain delivery and private domain operations.

According to a questionnaire survey conducted by WeMall Research Institute, the main problems in public domain delivery are single content materials, scattered delivery channels, and mismatched delivery audiences.

Among them, 55% of brands were unable to achieve good delivery results due to the single content material, 48% were unable to achieve integrated marketing due to the large number of delivery channels, and 43% had low delivery accuracy due to the mismatch between the delivery media and the audience.

In the process of private domain operations, problems mainly occur in three aspects: marketing tools, organizational talents and operational efficiency. Among them, the accumulated private domain traffic cannot be converted into repurchases through effective operational means, which has become the primary problem for the brand.

In addition to the pain points in the public and private domains, in the new consumption scenarios, 83% of brands focus on post-link marketing, hoping to improve the conversion rate of delivery and build their own traffic pool through SaaS tools. At the same time, more than 50% of brands have demand for content creativity, precision marketing and data analysis.

In this context, new consumer brands need to continuously optimize the operational efficiency of private domain traffic and continuously improve their content operation and service capabilities. At this time, it becomes extremely important to leverage the power of third-party service providers to break through.

Among all service providers, WeMall's approach to these pain points and difficulties stands out - relying on its excellent technology and service attitude, it proposes the TSO full-link intelligent growth solution, helps brands integrate and expand traffic resources through Traffic, assists private domain e-commerce in efficient monetization through SaaS tools, and realizes in-depth operation of private domain users through Operation.

In addition, the "WeMall Report" also mentions predictions about future marketing trends.

First, let’s focus on the role of content construction. The report believes that high-quality content is an important link in connecting users, and content creativity will become the key to link marketing.

In fact, according to the results of a third-party brand survey, from the perspective of marketing strategy value, executing content marketing and creating hard-core high-quality content ranks first in "marketing strategies with both short-term and long-term value"; from the perspective of marketing budget allocation, more than half of the brand owners interviewed expect to increase their content marketing budgets.

It can be seen that brands have realized the importance of content marketing. In the future, with the layout and development of the private domain ecosystem, content construction will run through the brand and become a new growth engine in the user-centric consumer ecosystem.

The report also proposed for the first time that brands need "two-way empowerment" between the public and private domains, that is, to attach importance to the connection between the public and private domains, and not only to achieve traffic connection between the public and private domains, but also to enable two-way empowerment.

Previously, public domain traffic platforms mostly played the role of traffic entrances. Although we mentioned above that traffic platforms also play the role of ecosystem development providers, the platforms have mature business models and are makers of ecosystem rules, this role is often overlooked.

Today, as a stronghold for acquiring customers in the public domain, if we can realize the link cycle from public domain diversion to private domain conversion and operation through data feedback and algorithm optimization, in a marketing environment where public domain traffic is becoming increasingly expensive, new consumer brands may be one step ahead and win at the starting line.

And so on, it works silently and we expect new consumer brands to achieve full-chain intelligent growth through this.

Author: Science and Technology News

Source: Science and Technology News