It is best for brands not to do private domain

At present, the industry generally defines private domain traffic as: traffic that is independently owned by a brand or individual, can be freely controlled, is free, and can be used multiple times. Private domain traffic is usually presented in the form of personal WeChat accounts, WeChat groups, Moments, or APPs independently developed by the brand.

01

Business thinking has a stance, which is a sentence I have been saying repeatedly recently.

Platform thinking and traffic thinking are the business ideas of platform operators. Why would you, as a brand operator, follow suit? Are you afraid that the traffic fees are not high enough? Platform thinking and traffic thinking are used by platforms to "deal with" brand owners. The increasingly high traffic fees of e-commerce are the result of traffic thinking "dealing with" brand owners.

New retail is the retailer’s mindset and the internet version of KA’s game with brand owners. Why would you, as a brand owner, follow suit? Do you think KA isn’t making you feel uncomfortable enough?

Private domain traffic is also a retail mindset, and it is the bargaining chip for small retail stores to "deal with" brand owners. Why are you, a brand owner, joining in the fun? Do you think you haven’t suffered enough injustice? Business is a game, and business thinking is the bargaining chip.

Using your opponent's chips as your own chips is a misalignment of stance. There is no right or wrong in business stance, but it is wrong to stand on the wrong side. Brand owners have had a hard time in recent years. They have frequently stood on the wrong side and don't know who to follow. The problem is serious enough. This is the opening statement, let’s get to the point.

02

What is private domain? In short, people are traffic, relationships are channels, and acquaintances become regular customers. Relationships, as channels, have boundaries. Everyone has relationships, but they do not necessarily use them for business.

Many companies have used WeChat or mini programs to engage in full-staff sales, but the results have not been good. The main reason is that employees are unwilling to contribute their personal relationships to the company as business channels. Please pay special attention to the words used above. The relationship is a private relationship, and the traffic is company (enterprise) traffic.

When do personal relationships and corporate traffic overlap highly?

——Self-employed, what is the difference between KA and a street shop? Big stores are the traffic source for business districts. The bigger the store, the larger the business district radius and the greater the traffic. A small store is the superposition of business district traffic and private domain traffic.

No matter how small a store is, it has a business district radius. The business district radius of a convenience store is “5 minutes’ walk”, and the private traffic of a small store means turning acquaintances into regular customers.

When a consumer has multiple small stores within the radius of a business district, he or she will of course go to the store with which he or she is familiar. Why do big stores have no private domain? Sales clerks in large stores have high mobility and may not have acquaintances in the business district. Even if they do have acquaintances, they may not be willing to contribute to the store.

Although some stores now require sales staff to add customers on WeChat, it is just an additional channel for transmitting information. This relationship is completely different from the private domain.

03

Even a small store may not have private domain traffic.

The more down-market it is, the more community stores there are, and the more private domains there are. There are not many private domains in urban stores. There must be a prerequisite for the private domain traffic of a store: the living radius and the business district radius overlap, and acquaintances are familiar customers.

They are in the same living radius, so they are acquaintances; they are in the same business district radius, so they are regular customers. The two overlap, and acquaintances become regular customers.

In the sinking market, there are remnants of agricultural ecology, where the sounds of chickens and dogs can be heard and everyone knows each other; in the community stores, you can see people you don’t know when you look down, but you can recognize them when you look up, and people are familiar to you even if they are not familiar to you - this is private domain traffic.

Private domain refers to the traffic that can be influenced by the store owner. In small urban stores, there is a large floating population and the living radius is separated from the business district radius, so there is no private domain traffic.

04

There is also a private domain, which is the traffic generated by extending offline relationships to communities and mini-programs. Or the traffic generated by stores and communities, which is what many people now call [store + group]. For example, the "group leader" of community group buying is private domain traffic. This is just an enhancement of the store’s broad private domain.

People with connections create traffic, and two business models have been formed: one is micro-business and social e-commerce; the other is community group buying.

Micro-business is a business model formed mainly by marginalized people, using communities as a bond, breaking through the life difficulties of marginalized people as an inducement, and taking a small number of cost-conscious people as a model.

This model is disdained by the mainstream, but some people actually make money from it. However, this model is nothing more than the revival of traditional direct sales or pyramid schemes through social means. It cannot be said that no one has succeeded in the short term, but this kind of success ends up destroying the commercial value of the community.

In 2020, micro-business and social e-commerce have become silent. The private domain model of [store + group] has actually existed for a long time. This is just the double superposition of private domains. Strong offline relationships are the foundation of the private domain; strong community interactions are the reinforcement of the private domain; mini programs facilitate transactions, which is a new technical monetization method for the private domain.

05

The above are all preparations. The core point of this article is "Brand owners should not engage in private domain business."

1. Private domain is the logic of retail

People are traffic, and relationships are channels. Whether online or offline, private domain is retail logic. Retail stores have many suppliers, and the private domain of retail will eventually be allocated to suppliers. From the perspective of brands and agents, it is a public domain.

When retailers sell private domains at a marked price (it can be in any form such as display, discounts, traffic fees, etc.), it becomes commercial domain traffic.

2. Private domain traffic has boundaries

There must be strong relationships in the private domain. According to Dunbar's number, the number of people a person has stable social relationships with does not exceed 148, which is determined by social costs and human energy. The emergence of communities has relatively reduced social costs. Even if the Dunbar number has expanded, the boundaries of private domain traffic are still very limited.

Third, if brands engage in private domain traffic, it means reaching a large number of C-ends. Small brands may be able to do it, but big brands cannot; Fourth, simple and crude social network operation models such as creating groups and sharing have become ineffective.

There used to be many companies and manufacturers where thousands of people formed groups and spread the word, but the results were limited. For brand owners, private domains may be useful, but they cannot save lives. Brand owners lack room for growth in private domains.

——This is the question of the relationship between watermelon and sesame.

06

In my previous article, I proposed that "there is no public domain in the world anymore". Valuable public domain traffic has become commercial domain traffic that is sold at a price. Traffic is only available if you pay.

This article also suggests that "brand owners should not engage in private domain business". So, do brands have no choice but to engage in commercial domain traffic? If the private domain cannot be expanded, will the commercial domain be passively slaughtered? Is there still a way out for brands?

Of course, business is a game. We must not have the extreme mindset of "big store bullies customers" or "big customers bully the store", and we should seek a balance in the game.

Traditional marketing is balanced. Brands influence the C-end through brand operations and then reach the B-end through channels. There is pulling force on the C-end and pushing force on the B-end. This is the dual drive of brand-driven and channel-driven in traditional marketing.

A single driving force is unbalanced. In the Internet era, platforms as giants have greater voice, but the total amount and share are limited, so platforms also face traffic depletion. Some brands are not familiar with self-media operations and have lost the ability to influence the C-end.

Therefore, brands as a whole are now facing great confusion.

07

Under the current circumstances, how can brands find a relatively balanced marketing system? I think it is BC integration. More than 3/4 of the total retail sales of goods in society are still on the B-end. This is a very important judgment.

Therefore, channel and terminal operations are still indispensable, and we must still pay attention to channels and terminals. At the same time, we must pay attention to another major achievement brought about by marketing digitalization: brands reach the C-end through the B-end long chain.

The ability to reach the C-end is the right to speak in business. In the past, retailers and platforms were able to reach the C-end, but brands could not reach the C-end, which led to the current predicament.

However, digitalization is only a result. What is really needed is to change the marketing operation system, that is, an integrated BC operation system. BC integration can achieve dual results. On the one hand, it can reach and influence the C-end; on the other hand, it can interact with the B-end more accurately.

Generating incremental growth through the C-end and activating existing stock through the B-end is the ideal state of BC integration.

08

The key is the BC integrated operation mode. Whether it is private domain traffic or business domain traffic, there is no leverage effect. The value of BC integration is the cross-activation of the B-end and the C-end to form a leverage effect. Marketing without leverage effect ultimately becomes a competition for resources.

In the competition of resources, the bigger the better, the better the better. What is the fulcrum of the BC integration leverage effect?

I think it is KOC, why is it KOC? Because the B-side has become commercialized, KOL has become commercialized. As soon as a live streaming influencer becomes popular, he or she will be commercialized.

The KOC is the one that has not yet been commercialized and can play a role in enhancing the connection between the B-end and the C-end. Any KOC that has been commercialized is actually on the B-side. The reason why KOC is valuable is that the core of KOC is its strong relationship with the C-end.

The value of a single KOC is limited, but as long as KOCs form a density, the value is unlimited.

KOC is valuable, so why should brands take advantage of it? If it is paid, it is no different from commercial domain traffic. Therefore, paying will only make KOC go against its value.

The B-side also has strong relationships, but the strong relationships on the B-side eventually turn into business domain traffic. How can KOC’s strong relationships be transferred to brands so that they can be used? The answer is strong cognition, which allows KOC to willingly give up strong relationships.

The most powerful means of cognition is scene experience. One experience is better than a hundred media communications. This is why we attach great importance to scene experience.

Activate KOC with scene experience, and activate B-end and C-end with KOC. Therefore, whether it is the public domain, private domain or business domain of retail or platform, there is the ability to bargain.

Now, no one ignores BC integration.

Author: Liu Chunxiong

Source: Liu's New Marketing (ID: liuchunxiong1964)