Daily Fresh Product Analysis

With the development of the Internet, many services can be enjoyed without leaving home. For example, when buying groceries, you only need to place an order for the groceries and a rider will deliver the groceries to your door. Last year's epidemic made this grocery shopping model develop rapidly and mature, and MissFresh is one of the best.

In recent years, China's fresh food e-commerce market has developed rapidly, especially with the support of capital. At present, in addition to traditional fresh food e-commerce, innovative models such as forward warehouses, "supermarkets + catering", and community group buying are constantly emerging in the fresh food e-commerce market. It can be seen that the competition in the fresh food e-commerce market is very fierce. According to IT Orange data, MissFresh received multiple rounds of financing in 2020. How this company grew rapidly and gained a certain position in the fresh food market.

This article will give you an in-depth understanding of the operating logic of this company and the fresh food e-commerce industry by analyzing the perspective of Daily Fresh.

1. Industry Analysis

MissFresh is a fresh food O2O e-commerce platform centered around ordinary people’s dining tables. Covering all categories including fruits and vegetables, seafood, meat and poultry, milk and snacks, MissFresh has established an ultra-fast cold chain logistics system of "city sorting center + community distribution center" in major cities, providing users with ultra-fast cold chain distribution services of "2-hour door-to-door delivery" for global fresh products.

So why has the fresh food platform been in a period of rapid development since 2017? This is because the fresh food e-commerce industry is an industry affected by macro factors. Next, we will use the PEST model to explore the reasons behind this.

1.1 Policy

A major factor for fresh food e-commerce products is the cold chain link, and cold chain logistics has become a rigid demand for fresh food e-commerce.

After the release of the "Agricultural Products Cold Chain Logistics Development Plan" in 2010, my country's cold chain logistics construction entered a period of rapid development.

In 2013, the Central Government’s No. 1 document, “Notice on the Division of Responsibilities for the Implementation of the CPC Central Committee and the State Council’s Several Opinions on Accelerating the Development of Modern Agriculture and Further Enhancing the Vitality of Rural Development”, included seven policy measures involving cold chain logistics. In the same year, seven ministries including the Ministry of Transport, the Ministry of Commerce, and the State Post Bureau jointly issued the "Opinions on Strengthening and Improving Urban Distribution Management." As a result, the development of cold chain logistics has accelerated after 13 years.

In January 2019, the State Council issued the "Guiding Opinions on Deepening Consumption-Driven Poverty Alleviation and Helping Win the Battle Against Poverty" to promote the export of agricultural products from poor areas through e-commerce.

In February 2019, the State Council issued the "Opinions on Promoting the Organic Connection between Small Farmers and Modern Agricultural Development", supporting the development of e-commerce economy in rural areas and promoting well-known e-commerce companies to help small farmers sell fresh agricultural products.

How to achieve rapid sales of fresh agricultural products is an issue that even national leaders attach great importance to. Judging from the policies issued by the country in recent years, fresh food e-commerce can be said to be a new solution to the problem of the difficulty in buying and selling agricultural products. The release of these policies shows that the current political environment for fresh food e-commerce is relatively good.

1.2 Economic aspects

1.2.1 Macroeconomic Environment

On the one hand: Although my country's population growth rate is low, the total population is on the rise. Nowadays, more and more people, especially young people (see Figure 1.1), use the Internet to meet their daily needs and seek a faster and more convenient lifestyle. This constitutes a relatively large user base for the fresh food e-commerce industry and is also the main force in the industry.

On the other hand: due to the vigorous development of new industries, new business forms and new models in recent years. According to the latest data released by the National Bureau of Statistics, the national residents' income in 2020 increased by 100% compared with 2010, and the national per capita disposable income increased by 2.1% in real terms. People's living standards are gradually improving. Data showed that basic people's livelihood expenditures continued to maintain steady growth, with per capita commodity consumption expenditure of residents at 12,173 yuan. As people's income levels continue to rise, the demand for fresh products will continue to increase. Conversely, a decline in income levels will also lead to a decline in demand for fresh products.

Figure 1.1 Age distribution of Chinese online fresh food shoppers (Source: iResearch report)

1.2.2 Microeconomic level

In 2020, due to the impact of the epidemic and the jurisdiction of national policies, the country took strict control measures and persuaded the public to minimize public gatherings. In the first half of the year, many families were forced to stay at home. Especially during the Spring Festival, people from all over the country joined the rush to buy food. However, during this special period of the epidemic, you need to be fully armed when going out. Whether shopping in the vegetable market or supermarket, you need to keep a distance of several meters, but there is no way to eliminate the risk of infection. Therefore, more and more people choose to have fresh food delivered to their homes, which saves time and is safe. From Figure 1.2, it is not difficult to see that the purchase frequency of fresh food e-commerce users in my country has changed before and after the epidemic, which is also an important factor in the rapid development of fresh food e-commerce in 2020.

Figure 1.2 Purchase frequency of fresh food e-commerce users in China in 2020 (Source: iResearch report)

1.3 Social and cultural aspects

The main consumer groups in today's society are those born in the 1980s and 1990s. According to the data in Figure 1.3, current users generally have a high level of education. This has also led to a gradual change in consumers' perceptions.

Figure 1.3 Educational background distribution of Chinese fresh food e-commerce users (Source: iResearch report)

The transition from the initial rational consumption era to the sensory consumption era and then to the emotional consumption era is the impact brought about by social progress and changes in the times. Currently, consumers’ requirements for products are not only about quality and price, but also about time and other factors. According to survey data, 70% of consumers give priority to product quality when shopping, especially in the fresh food sector, where they have relatively high requirements for food quality and safety. On the other hand, under the fast-paced, 996 work and life patterns, consumers pay more attention to shopping efficiency and pursue convenience, which provides possibilities for the continued development of fresh food e-commerce.

Figure 1.4 Factors consumers consider when purchasing and their consumption preferences (Source: iResearch report)

1.4 Technical aspects

The continuous development and advancement of technology has brought many changes to the online fresh food e-commerce industry. The rapid development of the Internet has enabled fresh food e-commerce to develop along with the general trend of e-commerce.

• For fresh food, the freshness of the food and the speed of delivery are very important. With the support of national policies, cold chain logistics technology continues to upgrade, providing strong guarantees for food safety and logistics delivery speed.
• The gradual popularization of the Internet has enabled many netizens to learn about what is happening in the world without leaving their homes. For example, for agricultural products, the combination of "Internet + agricultural products" has enabled more local agricultural products to enter thousands of households. Through the fresh food e-commerce platform, e-commerce + logistics distribution has become a new marketing model for agricultural products.
• The improvement in the hardware performance of mobile phones, iPads, etc. has brought more possibilities to online shopping of fresh food. Online shopping can be done anytime and anywhere, and higher-performance devices provide a better experience.
• The strong user base of other products has also promoted the development of fresh food e-commerce. For example, WeChat’s mini-programs also provide diversified traffic entrances for fresh food e-commerce, bringing in more orders.

The above factors together have promoted the development of the fresh food e-commerce market. What is the development trend of this industry in the next few years? What is the direction of development?

Figure 1.5 Average daily active users of fresh food e-commerce from Q1 2019 to Q2 2020 (Source: Analysys International)

According to the data, we can see that after the outbreak of the epidemic, the average daily number of users in the fresh food e-commerce industry is still increasing. This is related to the marketing and promotional activities adopted by various fresh food e-commerce companies. On the other hand, users will continue the habit of purchasing fresh food online that they have cultivated during the epidemic. People have had good user experience using fresh food e-commerce during the epidemic. Under the current social context, especially as a new round of epidemic has begun to break out, as long as the quality and delivery speed of fresh food e-commerce are not reduced, the development trend of fresh food e-commerce will still be strong in the future. Currently, fresh food e-commerce is mainly in first- and second-tier cities, and there is still huge room for development in third-, fourth-, and fifth-tier cities. The market prospects for fresh food e-commerce are still very broad.

2. Analysis of Typical Models of Fresh Food E-commerce

2.1 “Forward Warehouse” Model

2.1.1 Model form

The forward warehouse is a warehousing and distribution model, in which each of its stores is a small or medium-sized warehousing and distribution center, which means that the headquarters’ central warehouse only needs to supply goods to the stores and can also cover the last mile. After consumers place an order, the goods are shipped from a nearby retail store rather than from a warehouse far away in the suburbs. This is the important premise that supports its ability to deliver within 30 minutes within 3 kilometers of the store. Such as MissFresh, Dingdong Maicai, etc.

2.1.2 Advantages

• Timeliness. The forward warehouse model can make store delivery more timely. After consumers place an order, the goods are shipped from the nearest warehouse, that is, the attached retail store, and can be delivered to customers in a short time.
• Cold chain fresh food delivery is fast and low-cost. Regarding the forward warehouse model, it refers to a small storage unit that is close to consumers, so it is usually set up nearby. Therefore, whether it is the speed of order response or the cost of delivery, the forward warehouse model has great advantages in comparison.

2.1.3 Disadvantages

• The investment in forward warehousing is relatively high;
• Due to the differences in consumers in each location, there are differences in category operations and prices;

2.2 “In-store + Home Delivery” Model

2.2.1 Mode

Fresh food e-commerce companies open stores around communities, using the stores as the center to serve users within 1-3 kilometers. Users can either shop in the stores or place an order on the APP, with the platform providing home delivery service within 1 hour. The stores opened by the platform can both open for business and undertake online warehousing and distribution functions. Such as "Hema Fresh", "7 Fresh" and so on.

2.2.2 Advantages

• Combining the advantages of home delivery and in-store delivery, the service is centered on the store to serve users within 1-3 kilometers, with a wider and more accurate coverage, and omni-channel to meet users' needs for home delivery and in-store delivery.
• The integrated online and offline user experience is good and the delivery efficiency is high.

2.2.3 Disadvantages

Since the demand for home delivery is mostly in first- and second-tier cities, the overall costs of rent, traffic, and distribution are high when stores are combined with home delivery.

2.3 Community Fresh Food Store Model with In-store Sales as the Main Strategy

2.3.1 Mode

Positioned as "a vegetable market at home", most of the locations are at the entrances of residential communities, thus being as close to consumers as possible. Such as Suning Store, Dailuobo, etc.

2.3.2 Advantages

Being at your doorstep can, to a certain extent, divert customer traffic from farmers' markets and hypermarkets.

2.3.3 Disadvantages

• It requires high comprehensive capabilities in site selection, store operations and supply chain management, and emphasizes cost, gross profit and loss rate control.
• Unable to meet consumers’ home delivery needs, etc.
• Property acquisition is more difficult than in the forward warehouse model, and the rental level depends on the location and brand premium.

2.4 Cabinet Mode

2.4.1 Mode

Collect user needs in advance, place orders directly with the place of production to purchase fresh produce, and then deliver it to the community, where users can pick it up at the self-service cabinets in the community. For example, "Food Fresh"

2.4.2 Advantages

• The categories are relatively rich;
• Achieve zero inventory through reverse customization, purchase based on sales and order-based procurement;
• Through large-scale direct purchase from bases and intensive cold chain distribution, agricultural product production bases are directly connected to consumers, reducing losses and distribution costs.

2.4.3 Disadvantages

The delivery time is relatively long, usually 1-2 days.

3. Competitive Product Analysis

Fresh food e-commerce has developed rapidly since 2013, following the general trend of e-commerce. Many companies have invested in e-commerce. Various types of fresh food e-commerce have emerged one after another. During this period, various models such as B2C, C2C, and O2O have emerged one after another. The strong Internet strength has also provided more choices and support for merchants.

Based on iResearch’s data analysis, we can see that MissFresh and HEMA Fresh are in a period of booming development. According to the TOP list of self-operated fresh food e-commerce applications in June 2020 from Analysys data, the monthly active users of fresh food e-commerce are still relatively high.

Figure 3.1 Development history of China’s fresh food e-commerce industry (Source: iResearch report)

Figure 3.2 Top list of self-operated fresh food e-commerce applications in Q4 2020 (Source: Analysys International)

Since DailyFresh and Dingdong Maicai are direct competitors and have similar user scales, we will use the two companies’ growth paths and business models as a starting point to gain a deeper understanding of the differences between them.

3.1 Daily Fresh

Business model: sorting center + first-of-its-kind forward warehouse + home delivery model.

Procurement method: Direct procurement from the origin, with a fresh produce procurement network covering nearly 20+ countries and regions around the world.

Purchasing categories: 12 categories including vegetables, fruits, meat, poultry, eggs, aquatic products, wine and beverages, snacks, daily necessities, etc.

Warehousing: Establish your own stations in the community, cooperate with offline convenience stores and supermarkets, and store fresh goods in supermarkets and convenience stores;

Distribution and number of forward warehouses: Forward warehouses are distributed in nearly 20 cities in the country, with more than 3,000 in number.

Delivery:

• Coverage: 3-5 km.
• Delivery time: 0.5-1 hour.
• Delivery fee: The platform delivers independently, with a basic delivery fee (if the amount is over 39, no delivery fee is required)

User source:

• Busy office workers;
• Lazy homebody college student;
• People working from home;
• housewife;
• People with disabilities;

3.2 Dingdong Shopping

Business model: Market + APP forward warehouse model, focusing on the fresh food e-commerce model of forward warehouse, with fresh food products with urgent needs as the main operating products.

Procurement method: City wholesale procurement and direct supply from brand suppliers. For commodities that are not easy to transport for a long time, such as vegetables and seafood, city wholesale procurement is adopted, while for the transportation mode of meat, brand suppliers are mainly selected for supply.

Purchasing categories: vegetables, fruits, meat, poultry, eggs, aquatic products, etc.

Warehousing: Establish your own stations in the community, cooperate with offline convenience stores and supermarkets, and store fresh goods in supermarkets and convenience stores;

Distribution and number of forward warehouses: Forward warehouses are currently mainly distributed in first- and second-tier cities. According to official website data, in May 2019, the number of forward warehouses was around 345.

Delivery:

• Coverage: 2~3 kilometers.
• Delivery time: 0.5-1 hour.
• Delivery fee: The platform provides independent delivery, with no minimum delivery threshold and no delivery fee.

User source:

• Busy office workers;
• Lazy homebody college student;
• People working from home;
• housewife;
• People with disabilities;

From the above analysis, we can see that MissFresh and Dingdong Maicai were established at a similar time and have developed rapidly. Both of them belong to the forward warehouse model. The advantage of this model is its low loss rate and high delivery efficiency. MissFresh has the first-mover advantage in the market and is ahead of Dingdong Maicai in terms of the number of cities and locations where forward warehouses operate, average customer spending, and monthly active users. In terms of the amount of financing, MissFresh has a relatively large amount of financing, which provides it with sufficient ammunition to form a leading advantage and continuously widen the gap with its competitors.

3.3 Summary

There are slight differences in business models. MissFresh has more fresh products from home and abroad, while Dingdong Maicai has few overseas products. Therefore, in terms of product diversity, MissFresh has more choices.

From the supply side perspective, Dingdong Maicai mainly adopts urban wholesale procurement. Dingdong Maicai's brand suppliers supply directly on demand every day, and then standardize the products in self-built city sorting centers, saving labor costs, warehousing costs, high cold chain transportation costs, etc. of source procurement, in order to achieve the goal of simplifying the supply chain; while MissFresh purchases directly from the place of origin. Although MissFresh's cold chain transportation is relatively complete, compared with urban wholesale procurement like Dingdong Maicai, the cost of its products may be slightly higher.

In terms of user experience, the target user group is office workers, and young people account for the majority, but many young people nowadays are not very good at cooking. Taking this factor into consideration, Dingdong Maicai has set up recommended practices and one-click add-to-cart functions on the product details page to facilitate users' purchases. MissFresh’s interface provides users with recipe choices, and the recipe details interface has an ingredient selection button (which allows users to add ingredients to the cart with one click). The two methods are slightly different, but their purposes are different. Both save users’ time and help increase user stickiness.

The two products have their own advantages. In order to meet diverse needs by comprehensively considering various factors, both are accelerating refined operations and further exploring possibilities in marketing, supply chain and other aspects. However, the specific effects are still unknown.

4. User Value Analysis

In the fresh food e-commerce market, there are three main participants: supply side, consumers and platforms. If a platform wants to achieve rapid growth, it must meet the needs of users and the demands of the supply side.

Below we will take MissFresh as an example to explore the needs of both parties and how the platform can better meet their needs.

Figure 4.1 Introduction to Daily Fresh’s model (Source: iResearch report)

4.1 Supply Side

As a self-operated fresh food e-commerce platform, MissFresh's main procurement methods are direct procurement from the origin and city wholesale markets. For the supply side, their main demands are the following: finding more sales channels; reducing distribution links; and increasing their own sales revenue.

Agriculture, as the upstream segment of the supply chain, provides fresh products such as meat, poultry, vegetables, fruits and seafood. However, fresh products are prone to corruption, are not resistant to storage and have strong seasonality in production. With the development of fresh food e-commerce, the capabilities of the fresh food supply chain have developed rapidly, but it is still the key factor in fresh food e-commerce. According to iResearch data, the current supply chain of fresh food e-commerce is as follows:

Figure 4.2 Analysis of the fresh food industry supply chain (Source: iResearch report)

For the supply side of fresh food e-commerce, there are currently several sales methods:

4.1.1 Self-sale supply model based on agricultural product wholesale markets

4.1.1.1 Mode

It is mainly demand-oriented, with the market spontaneously organized, and a supply model in which farmers directly reach consumers through local markets.

4.1.1.2 Advantages

The price is affordable and the product is fresh.

4.1.1.3 Disadvantages

Due to the dual limitations of product freshness and geographical location, the scale is relatively small, the circulation range is small, the variety of products is relatively small, and it is easy to have unsalable products.

4.1.2 Supply model based on cooperatives and enterprises

4.1.2.1 Mode

The supply model is mainly based on cooperative enterprises. This model is mainly based on farmers/large households, cooperatives, and agricultural enterprises. With the help of national policies and the development of agricultural science and technology, it has formed a relatively complete corporate production base and "vegetable basket" production base. Then the agricultural products undergo preliminary sorting, packaging, and processing, and then go through several distributors such as wholesalers at the production area and wholesale markets at the sales area before finally being supplied to supermarkets and other final consumer ends.

4.1.2.2 Advantages

• The product integration is relatively high and the product quality is relatively high;
• It can effectively help local farmers stabilize their sales channels.

4.1.2.3 Disadvantages

• From the figure, it is not difficult to see that from agricultural fresh produce producers to the final local farmers' market/consumer end, it goes through several levels of distribution channels. By the time it reaches the hands of consumers, the price is several times higher than the initial wholesale price.
• There are many circulation links, the circulation chain is long, and product losses are large.

Figure 4.3 Schematic diagram of China’s fresh food distribution chain (Source: iResearch report)

4.1.3 “Farm-Supermarket Connection” Model

4.1.3.1 Mode

The "farmer-supermarket docking" model relies on the supermarket's "direct purchase" - "supermarket + base + farmers" model. The supermarket has achieved comprehensive supervision of agricultural products from production, storage, transportation to sales. It is a new distribution method for farmers to directly supply agricultural products to supermarkets, vegetable markets and convenience stores.

4.1.3.2 Advantages

• Build a platform for high-quality agricultural products to enter supermarkets.
• The "farm-supermarket docking" model can effectively help local farmers stabilize their sales channels.
• Obtaining production and sales information, that is, farmers produce what the market needs, and encouraging farmers to improve their planting techniques can not only avoid blind production, but also stabilize the sales channels and prices of agricultural products, and improve the safety and marketability of fresh agricultural products.
• Provide consumers with a wide variety of fresh agricultural products with high quality and low prices.
• Large commercial enterprises can use their own network channels to sell products, reduce intermediaries, lower procurement costs, and leave more benefits to farmers and consumers.

4.1.3.3 Disadvantages

• The threshold for supermarkets is relatively high. Compared with traditional markets, supermarkets have set strict entry barriers for agricultural supermarkets. Such as entrance fees, promotion fees, etc.
• The loan period is relatively long. Generally speaking, large supermarkets and suppliers often use bank settlement payment methods with fixed transfer cycles. For agricultural product suppliers, the capital turnover period is a bit long.

4.2 Consumers

For MissFresh, its main users are distributed in first- and second-tier cities, and the consumer groups are mainly the following categories: busy office workers; college students; people working at home; housewives; people with disabilities, etc.

• Affordable product prices: From the perspective of busy office workers in first- and second-tier cities, after a busy day at work, they want to cook for themselves but don’t want to order takeout. As takeout is expensive and going to the supermarket is time-consuming, they want to buy high-quality products at a lower price when purchasing ingredients.
• Convenient and fast shopping: Students or people who work at home are extremely reluctant to go out on rainy days, in hot summer or in cold winter. They hope that fresh food can be delivered to their homes conveniently, so they don’t have to dress up and change clothes to buy products.
• There are many product categories and the quality is relatively good: For housewives, especially when there is only one person taking care of the children at home and they cannot go to the supermarket, they hope to be able to buy the daily necessities on the fresh food platform with one click, and the price should be relatively cost-effective. Considering children, they attach great importance to food safety.

According to data analysis, users have the following main demands: whether fresh food is convenient to deliver to their homes; the types of products; the quality of products; and the extent of price discounts.

Figure 4.4 Reasons why Chinese online fresh food shoppers choose to shop online for fresh food in 2017 (Source: iResearch report)

4.3 Platform

Analyzing from the above two aspects, the main problems on the supply side are:

• Diversification of sales channels;
• The existence of too many distribution links means that the freshness of fresh products cannot be guaranteed;
• Increase your sales revenue.

Consumers’ main demands are in the following three aspects:

1. The variety and quality of fresh produce;
2. Delivery speed;
3. Is the price affordable?

As a platform, how does MissFresh better meet their needs and attract them to this platform?

4.3.1 High-quality suppliers enter the market

According to the official website of MissFresh, in order to attract high-quality suppliers. MissFresh has achieved three "0s", namely: 1. 0 fees - no entry fees or promotion fees of any form; 2. 0 returns - qualified goods; 3. 0 account period - supply chain financial services. This strategy has eliminated the worries of suppliers and attracted a large number of high-quality suppliers to settle in.

4.3.2 Origin of the product

MissFresh mainly purchases directly from the origin. Reduce the existence of multiple intermediate distribution links and improve the integration of products. On the one hand: For the supply side, it can reduce the situation of unsold products. On the other hand, for consumers, the price of the product will not be too high. The freshness of the products can also be guaranteed.

4.3.3 Daily Fresh’s Delivery Speed

In order to meet consumers' demands for delivery speed, data shows that the number of Daily Youxian's forward warehouses has reached 1,500+, covering more than 20 cities in my country. The larger the number, the closer the distance is to consumers' residences to a certain extent, and the goods can be delivered within 1 hour after the user places an order, and the fastest can arrive in half an hour. Meet consumers' demands for delivery speed.

4.3.4 Daily Fresh Product Categories

MissFresh recently opened its 2.0 version of its forward warehouse to the outside world. Compared with the 1.0 version of the warehouse with an average area of ​​100-150 square meters, the storage area has been greatly improved to 300-400 square meters. In addition to the original refrigeration, freezing and normal temperature areas, functional areas such as Little Red Cup Coffee and fresh seafood have been added. This also means that forward warehouses can store a wider variety of products. Currently, MissFresh’s product range covers 12 major categories including vegetables, fruits, meat, poultry, eggs, aquatic products, wine and beverages, snacks, daily necessities, etc., which can meet the needs of users.

4.3.5 Daily Fresh Product Quality

Daily Youxian’s main purchasing method is: direct purchase from the place of origin, with a fresh food purchasing network in nearly 20+ countries and regions around the world. Starting from the source, the ingredients are carefully selected; multiple screenings are carried out before entering the warehouse to select the best from the best ingredients. In addition, MissFresh has a 100% cold chain system throughout the entire process and has a professional cold chain logistics system with the largest total cold storage area. It stores food in three major temperature zones, covering the entire transportation and storage process, and can ensure the freshness of the products. On the other hand, MissFresh adopts professional food testing and can control the quality of its products.

5. Commercial Value Analysis

As an e-commerce platform, MissFresh’s core business is revenue. Here we use the most commonly used data indicator GMV to analyze whether MissFresh’s core business is healthy. GMV (gross merchandise volume) is the core indicator to measure the competitiveness of a platform (market share). The key indicators that affect GMV include traffic indicators (number of users, etc.) and conversion indicators (first order rate, repurchase rate, etc.).

GMV = number of users * conversion rate * average order value. We can think of it as a function. The number of users, conversion rate and average order value are all independent variables, while GMV is the dependent variable. The dependent variable changes in direct proportion to the independent variables (that is, it increases with the increase of these three indicators). So let's focus on analyzing how MissFresh improves these three indicators:

5.1 Increase the number of platform users

Whether it is for other platforms or fresh food platforms, in order to achieve sustained growth in revenue, a steady stream of registered new users is the most basic guarantee. So how does MissFresh attract new users?

Generally speaking, there are two channels for attracting new customers: paid channels and free channels.

5.1.1 Large-scale advertising investment (paid channels)

5.1.1.1 Video ads, information flow ads, etc.

Through video ads placed on various Internet websites, such as the "You're Delicious Too" ad that MissFresh placed on Tencent Video, the entire ad tells the wonderful state of food through three interesting stories. Although the plot is bloody, it is the most common scene in life. Through the nonsensical storyline, the wonderful feeling of food is expressed vividly, especially at the end of each short story, the emphasis is on Daily Fresh, which gives the viewer a bright feeling. I believe that after reading this, users will not only be deeply impressed, but will also remember the magical slogan "Daily Fresh".

5.1.1.2 Through cooperation with other platforms

On June 13, 2019, MissFresh and Tencent held a strategic cooperation press conference in Shanghai with the theme of "Fresh to 100 Billion, Smart to Win". Relying on the support of Tencent Smart Retail's "all-touchpoint retail", the 100 billion smart fresh plan integrating "smart marketing, smart logistics and smart supply chain" was officially launched.

In October 2019, MissFresh signed a strategic agreement with Hengdu to collaborate on procurement and explore a new model of retail-supply cooperation. In this strategic cooperation, the two parties adopted an advanced cooperation model, relying on the big data advantages of both parties to conduct early sales forecasts and production capacity planning, and jointly carry out large-scale direct purchases from production areas, further controlling procurement costs while ensuring product quality. Even in the current situation of generally rising beef and mutton market prices, the cooperative products can still maintain stable prices.

In February 2020, we collaborated with Lenovo Xiaoxin to launch the "Love Gift Package" to share loving stories during the epidemic.

On April 21, 2020, Fengxiang Co., Ltd. signed a strategic cooperation agreement with MissFresh, joining MissFresh's "10 Billion Club" plan, and will work together to promote the innovation and upgrading of healthy chicken products, and will also cooperate in-depth in precision marketing and the integration of online and offline channels.

In September 2020, we reached a strategic cooperation with Tencent Maps, Knight Card, etc.

For example, by cooperating with other platforms such as Ele.me, Koubei, and Beike, taking advantage of the Ele.me New Year Festival to promote its own brand, and promoting the Blue Ocean Action with Beike.

5.1.1.3 Joint marketing with supplier brands on the platform

For example, Wanchai Pier, Coca-Cola, and Cha Cha attract users through a variety of activities.

5.1.1.4 Offline Advertising

Place advertisements at places like bus stops. The advertising slogans are close to the current social trends, such as Sisters Riding the Wind and Waves, and the Internet buzzwords "Oli Gei" and "OMG", attracting users by being close to the customers' psychology.

Large-scale advertising and marketing can greatly enhance brand awareness.

5.1.2 Excellent product reputation (free channel)

Excellent product reputation is very important for fresh food platforms. Word of mouth plays a crucial role in attracting new customers. Only when the product quality is good enough, the variety is wide, and the delivery speed is fast can it attract new and old users.

5.1.2.1 Before purchase

Invite friends to help. Old users can get coupons or red envelopes by inviting new users to register and like their posts.

5.1.2.2 Purchasing

Help get it for free. New and old users can initiate group purchases and invite friends to help. As long as the required number of helpers is reached, they can get products or coupons for free.

5.1.2.3 After purchase

Invite friends to get cash back. After old users purchase products, MissFresh will return part of the money to the users in the form of red envelopes. Users need to invite a specified number of users to help, and then they can withdraw the money.

Therefore, we often see users who purchase Daily Youxian sharing links and inviting friends to help. This simple and effortless way of click-and-support can be said to be a good way of promotion. Therefore, when a product has a good reputation, word-of-mouth communication will also be formed.

5.2 Improve user conversion rate

After users register as new users of MissFresh, the purchase path for their first purchase can be roughly divided into two categories: clear users and unclear users.

The user path is generally: search for products - enter the product details page - add to shopping cart - pay.

The unclear user path is generally a series of repeated processes: browse products on the homepage - view details - browse products - view details... - add to shopping cart, and finally checkout.

Let’s take a look at how the page is designed from the user’s purchase process touchpoints: product list page - product details page - shopping cart page. For such unclear users, they rely more on the operation side (activities, discounts, atmosphere, etc.) to guide users to generate the desire to buy. So how does MissFresh stimulate consumers to make the final settlement in these links? The following analysis starts with the user purchase process touchpoints.

5.2.1 Product List Page

After searching and entering the product list page, which product should the user choose from the dazzling array of products? Based on Hick's Law, MissFresh reduces the degree of confusion users have when making choices, because if users spend more time at each link, they may lose some customers. The homepage is divided into several categories, such as seasonal fruits, fresh vegetables, seafood, etc., for users to quickly select.

When purchasing fresh products, users mainly focus on the following factors: time, origin, price, etc. Therefore, MissFresh predicts user concerns in advance and provides information such as "delivery in as fast as 30 minutes", "direct sales from global origins", and "one-stop shopping at low prices every day", so that users can feel at ease to purchase products. The page also has sections such as Today’s Flash Sale, Today’s Fresh, and hot-selling items to attract users’ attention.

From the above pictures, we can clearly see that: first, the homepage of MissFresh highlights the product pictures to confirm that it is the product you want; second, it highlights the price to see whether it meets your psychological price range; third, it looks at the popularity and sales volume to see whether there is a herd following. This guides users to the product details page

5.2.2 Product Details Page

After users select the product they are interested in on the product list page, they enter the product details page. The product details page is the user's consumption experience page, and the quality of its design will have a direct impact on the user's purchasing behavior. So how does MissFresh help users make quick decisions and add products to their shopping carts?

5.2.2.1 Establish consumer protection

First of all, due to the epidemic, we often see news reports that certain product packaging or some product tested positive for the new coronavirus. In order to dispel customers' concerns. MissFresh has set up a safe channel on the product details page. Build user trust and a sense of security, allowing users to purchase with confidence and solve after-sales problems without any worries!

5.2.2.2 Create a popular and well-reputed atmosphere

MissFresh sets up a user comment area on the product details page. Through user comments, it builds a sense of trust on the one hand and creates a strong consumer popularity atmosphere on the other.

5.2.2.3 Create a sense of product scarcity and urgency

MissFresh tells users through inventory quantity and number of products available that products are very popular and if they don’t buy them quickly, they will be out of stock later. The countdown to a flash sale gives people a sense of urgency.

5.2.3 Shopping Cart

When users add products to the shopping cart, the page will once again emphasize information such as "delivery in as fast as 30 minutes", and this display will be accompanied by a colorful slogan to satisfy users' psychological needs. After selecting the products you want to buy, MissFresh’s interface takes the user’s shopping habits into consideration and sets a prominent “Go to Checkout” button in the lower right corner to enhance the user’s willingness to check out. After clicking on the checkout page, the super value exchange interface will pop up, which can give customers a sense of platform concessions when approaching checkout.

5.2.4 Checkout page

The checkout page is the interface where users are about to make payments. First of all, consumers can flexibly choose the delivery time to enhance their sense of control and allow them to get the goods when they need them most. Secondly, the platform clearly lists the discount amount of the goods, available red envelopes (for example, launching wallet-saving activities), whether basic delivery fees are required, and other information. In terms of the strength of the discount, users are given a "super cost-effective" psychological feeling, which reduces the decision-making process for consumers. Finally, when faced with temporary out-of-stock situations, users are given a variety of options to avoid the impact of time delays on users.

5.2.5 Cashier Interface

The checkout counter supports mainstream mobile payment methods in the market, such as WeChat, Alipay, Huabei and UnionPay QuickPass. After selecting the payment method commonly used by the user, it will automatically jump to the payment interface to avoid payment obstacles encountered during settlement to the greatest extent, allowing consumers to smoothly complete a series of operations and successfully place an order.

The design of the Meituan Youxian interface can satisfy users’ desire for bargains (discounts, promotions), the principle of shortage (limited discounts for a limited time, loss if not bought), the principle of authority (platform security service guarantee), and environmental impact (popularity, comments), etc., to eliminate users’ concerns, reduce users’ decision-making time, and thus increase their willingness to buy. In addition to improving user conversion rate, you can also consider increasing the average order value to increase GMV.

5.3 Increase Average Order Value

After acquiring users, how does MissFresh increase its customers' average order value and maximize profits through various means?

In the fresh food e-commerce industry, due to the widespread existence of offline markets, it is basically in a state of perfect competition. Therefore, the unit price online cannot be too high. For fresh food e-commerce, the two most important conversion indicators are first-order rate and repurchase rate. In addition to this, how to increase the unit price of goods, thereby increasing the unit price for users and increasing gross profit margin at the same time. The platform's average order value is affected by two factors: the single purchase amount and the user's purchase frequency.

5.3.1 User Purchase Frequency

Daily Fresh’s business system is mainly divided into the following two types:

By distributing coupons from time to time, users will be stimulated to make frequent purchases. For example, on Member Day every Wednesday, customers can develop the habit of buying groceries from Daily Youxian, thereby stabilizing customers and ensuring their consumption continues over the long term.

MissFresh also launched wallet-saving activities, such as a limited-time discount (83 yuan red envelope for 3.9 yuan); after purchasing the wallet, the platform will immediately issue all the red envelopes contained in the wallet to the account that purchased the coupon package, without the need to claim them. The order can be used after purchase. The condition for using the red envelope with unlimited discounts is that only one red envelope can be used for one order. If the user wants to use the remaining red envelopes, he needs to place another order. This can increase the user's repurchase rate.

5.3.2 Single purchase amount

5.3.2.1 Free Shipping

MissFresh has a basic delivery fee. If the actual payment is less than 39 yuan, a basic delivery fee of 5 yuan will be charged. When we buy goods, we all have a psychological feeling that we would rather spend money on the goods rather than on the shipping costs. Even if the shipping cost is only a few yuan, people will find ways to add a small order to get free shipping. Daily Youxian will also prompt on the shopping cart page, "Actual payment of 39 yuan or more will get free basic shipping, but you still need XX yuan", and provide a "add a small order" function, which can easily increase the user's single purchase amount. On MissFresh, many products are not very expensive, and users can pay the basic delivery fee by just paying a little.

5.3.2.2 Discount coupons/red envelopes and other promotional activities

Through the super value exchange, half-price for the second item in the shopping cart checkout page, and related product recommendations on the product details page, the number of products purchased by users can be increased, indirectly increasing the average order value of the products.

To sum up, MissFresh has taken various measures to increase the number of user registrations, conversion rate, and average order value. And the results are very good at present, so investors continue to increase their investment, because the commercial value of MissFresh is still very broad.

6. Product Iteration Analysis

In order to deeply analyze the version iteration rhythm of MissFresh and explore the product iteration logic, we have summarized all the core version iterations of MissFresh from V1.0.1 to V9.8.80 as follows:

According to the curve distribution of the cumulative downloads of Daily Youxian on Kuchuan, it can be seen that the development of the product is similar to an "S-shaped" curve, so the following analysis is divided into five stages:

Daily Youxian Android cumulative download channel distribution chart (Source-Kuchuan):

6.1 Phase 1: Cold Start Phase

Before January 2016, MissFresh’s versions V1.0 – V2.0.1 (2015.04.27-2015.12.22) mainly focused on optimizing basic functions. In order to optimize the user's consumption and shopping experience, during this stage, the main focus was on fixing the problem that the shopping cart and product information could not be fully displayed; the personal center, order list and product details were optimized, and new functions such as coupon reminders and sign-in recharge were added. In order to help users choose products more personally, a new module called “My Shelf, You Are the Boss” has been added. At the same time, in order to avoid users being unable to pick up goods due to delivery address issues and to reduce delivery costs, the platform has also added delivery address labels and multi-region displays, which are functions to help users optimize their purchase paths. This is a very good way to enhance product quality.

6.2 Stage 2: Early stage of growth

Since the beginning of 2016, that is, version V3.0.0-V4.0.0 (2016.03.04-016.07.09), MissFresh is in a slow growth period. During this period, MissFresh mainly started to increase the construction of operational tools in order to expand the number of users, such as membership system, invitation gifts, etc. Recruiting new users and retaining old users have become the focus of product iteration.

In order to reduce user loss caused by the cumbersome registration of new accounts, MissFresh provides mobile phone login support. In order to attract new users, Youxian has been constantly increasing its efforts to inviting friends to receive rewards, from inviting friends to receive 50 yuan each, to inviting friends to receive 60 yuan each, to inviting new users to download apps and place orders, you and TA both receive 6 yuan gifts, etc. What remains unchanged is the strategy of giving more invitations and rewards. Taking into account users' desire for bargains, old users continue to recommend the platform to their relatives and friends. On the other hand, in order to make newcomers willing to be invited to register, newcomers also enjoy rewards (such as gifts such as 99-50 for the first order, or coupons, etc.).

During this period, in addition to attracting new users, we also increased the number of users on the platform. In order to improve user stickiness, Daily Youxian has added a new membership system, such as: place two orders per month and easily become a member. Members can enjoy super low prices, exclusive member products, exclusive fresh delivery and super-fast refunds, and other benefits.

The newly added online customer service and refund functions facilitate user consultation, after-sales refunds and a series of other issues, allowing users to rely on the platform with greater confidence.

6.3 Stage 3: Medium Growth

In the Daily Youxian version V4.1.0-V5.9.1 (2016.07.27-2017.06.29), the pace of attracting new products has slowed down. During this stage, the iteration of products is mainly to improve user stickiness and enhance user experience.

In terms of attracting new customers, the platform has launched a 100 yuan coupon package for new people, and invites new cumulative rewards and other benefits, which will help attract new customers. In terms of retaining old users, MissFresh continues to optimize basic functions at the product level. In order to improve the user's retention rate and repurchase rate, the platform has added new consumption rebate points, member points exchangeable products, and the buy-free mode is enabled.

The platform has added many new features to make the product more complete and improve customer satisfaction. New services have been added, such as arrival reminders, the ability to check product delivery progress on orders, nationwide delivery channels, scheduled delivery of pre-sale products, and tomorrow's delivery of sold-out products. at the same time. New search and evaluation functions have also been added to help users find target products more accurately and enhance consumers' confidence in purchasing products. The addition of feedback portals helps collect user information and facilitates product iteration.

In order to make users feel more assured about the source of the goods, the platform has launched a function to query the quality inspection reports of fruits and vegetables, and view the relevant quality inspection reports on the product details page.

6.4 Stage 4: Rapid growth period

In the version of MissFresh V6.0.0-V9.8.0 (2017.7.18-2019.12.23), since attracting new products and retention has always been the main theme of the growth period, MissFresh has also been committed to improving its membership system and optimizing new products and activities.

From the data point of view, at this stage, the number of users of MissFresh has shown an explosive growth, indicating that MissFresh's series of actions at the product level and operation level have achieved good results.

6.4.1 Retain new products

For new users, the platform launches [New Customer 0 Yuan Buy] When new users spend 39 yuan on purchases, they will immediately get a cash balance of 39 yuan after successful signing. Attract new users. For old users, the platform is mainly to improve retention rate. A new buyer talk column was added, a new peace of mind detection label was added, product details showed business certificates, discovery channel was launched and personalized recommendations were made to make users more at ease to buy products. The limited-time flash sale function is newly launched: such as: inventory residual volume prompts, flash sale countdown display, and grab reminder, which are used to guide users to increase the platform's repurchase rate.

6.4.2 Membership System

New promotional gameplay (such as adding red envelopes, quickly collecting orders), and the launch of the new membership system. You can share membership rights with friends. During this period, MissFresh strives to grasp the new pain points of users and improve member loyalty.

6.5 Stage 5: Period of Steady Development

In the version of MissFresh V9.8.5-V9.9.11 (2020.1.6-to-present), after the previous stages of development, MissFresh is currently in a period of steady development. The page design has been revised several times and the interaction details have been updated many times. Enhance visual interactivity, strengthen precise delivery, put people first, improve user experience and further enhance user stickiness, which is not just a fresh food trading platform.

For example, due to the epidemic, MissFresh launched the "contactless delivery" service, which is to consider users and improve its user experience. For example, the platform enhances the protection of phone privacy in version 9.8.83, and continuously perfects the user experience from these subtleties.

6.6 Summary

To sum up, in the cold start stage, MissFresh mainly focuses on the realization of users' basic needs. If you are eager to promote and attract new products at this time, it will be difficult to retain users. Therefore, at this time, MissFresh focuses on repairing and optimizing consumer shopping paths.

When Daily Youxian is in the growth cycle, the platform begins to shift its core goals to attracting new people and retention, and acquires new users through a series of operational operations such as new people's rights distribution, member upgrades, and inviting friends, and the number of users increases by multiple levels.

When the user scale tends to grow steadily, the development of Daily Youxian has entered a mature stage. At this stage, the platform pays more attention to the user's stickiness and user experience, perfects the user experience in details, and launches personalized recommendations to meet the different needs of users at different levels. The above are the overall iteration steps of MissFresh.

7. Product structure analysis

In the iterative analysis, we analyzed the iterative steps of MissFresh’s product functions. Next, let’s take a look at what user needs these functions meet and how they are distributed throughout the app. This is mainly analyzed through product structure. The following figure is the product structure brain diagram of MissFresh V9.9.11.

7.1 Daily Youxian Structure Brain Map

For the convenience of analysis, by re-examining the product structure of Daily Youxian according to users, scenarios, needs and functions, you will get the following table:

7.2 Overall Analysis

The main target users of fresh food e-commerce are the consumers themselves, so the platform must build the entire structural framework of the product based on matching consumers' pain points.

Daily Youxian is divided into five major layouts in the main page settings: "Homepage", "Category", "What to Eat", "Shopping Cart", and "My". The settings of these layouts are considered that users generally face the following scenarios:

7.2.1 "Homepage"

When a user opens the app, there are two situations. One is to clarify what to buy, and the other is unclear. The layout of the homepage just meets the user's needs and provides purchase-oriented thinking. Users can find the discounts on products on the "Homepage" such as today's flash sale.

7.2.2 "Classification"

When users purchase, users who are particularly clear about the items they need can quickly locate the products on the search page of the homepage. The classification interface is mainly classified according to several major categories. Users can first find the major categories they want to buy, such as fruits, vegetables, or seafood. Then, based on the subdivision of categories, quickly locate to more accurate categories.

7.2.3 "What to eat"

The “what to eat” page of Youxian is the most commonly used user is young people. Young users are not familiar with cooking and are also confused about what to eat. This page fully meets users' needs for what to eat. Here you can share your own recipes, or find recipes shared by others. In the lower right corner of the recipe, Daily Youxian provides a food purchase button. The ingredients required for the recipe have a one-click purchase function, which makes it easier for users to quickly select ingredients.

7.2.4 "Shopping Cart"

The layout of Daily Youxian’s “Shopping Cart” is mainly to allow users to see the discount information, quantity, delivery time, etc. of the product at a glance. It also gives users a chance to re-check, avoiding users filling in the quantity incorrectly due to misoperation and other reasons, and have the opportunity to change it. During the shopping process, products that are invalid due to delivery distance or may appear. The shopping cart will be reflected here. The color marked by out-of-stock products will become gray for users to see clearly. Avoid users’ awareness of temporarily invalid products only after shopping, and reduce dissatisfaction.

7.2.5 "My"

After the user purchases, if he wants to understand the delivery progress of the order, he will also need to return or refund and invoice. Then users can quickly find their needs in the "My" interface.

7.3 User needs and platform solutions

7.3.1 Scenario 1: What needs do consumers have before shopping and what functions does Daily Youxian meet this needs?

When consumers use a new fresh food e-commerce platform, they may want to know the platform's business qualifications and other related information. Therefore, they can directly view it through the "Qualifications and Rules" button on the homepage to use this platform with more confidence. If it is an unused platform, the first thing consumers are concerned about is whether they can deliver to the location they want. According to the address selection, there may be differences in the inventory of platform products. Therefore, the platform has set a positioning button at the top of the homepage, so that the product can be sold out and cannot be delivered before selection.

According to the commercial value analysis of the previous part of the products, we know that there are two types of consumers, one is a consumer with clear goals, and the other is a consumer with unclear goals.

For consumers who have already determined the target product, the fastest way is to search directly by entering keywords. The search box at the top of the homepage plays a fast locking role; at the same time, clicking on the search box will also show historical searches, popular searches and I often buy them, which is the effect brought by big data analysis.

For consumers who have not yet determined their target products, because they rely more on the operational side (events, discounts, atmosphere, etc.), a platform is needed to guide/stimulate consumers to develop a desire to buy. The information flow advertisement on the homepage of the Daily Youxian directly informs consumers of the best activities. The existence of the hot sales list of New Year goods is also a purpose of giving reference to such consumers.

In addition, consumers may not be sure what to buy and need to borrow the recipe information. What pieces of noodles to eat in Daily Youxian can be used as a reference for consumers.

7.3.2 Scenario 2: What new needs will arise in consumer shopping? How does MissFresh ensure that users place orders with peace of mind?

When consumers buy products, they want to know the quality information of the products. In response to this, Daily Youxian provides a safe channel on the product details page, and can see reports on verification and testing by third-party institutions. Professional inspection reports will greatly increase users' confidence in consumption. On the other hand, consumers want to see the evaluations of other consumers who have purchased the product before. The platform provides a user evaluation interface on the product details page. Consumers can judge whether they want to buy based on their evaluation.

In fact, many consumers do not want to pay for shipping when shopping. Most people choose to control the consumption amount within the range of free shipping. According to this, the platform has added the function of order-collecting orders in freight prompts and coupons, which can quickly collect orders and free shipping, and shopping carts can also add and delete items immediately, making it easier for consumers to make quick choices.

7.3.3 Scenario 3: What new demands will arise when consumers settle? How does MissFresh ensure that users place orders with peace of mind?

Since each user has different requirements for delivery time, the delivery time will be prompted on the product details page and the last settlement interface, especially in the last settlement interface, the platform gives consumers multiple time choices so that consumers can choose the most desired time to receive the product.

In order to meet the various payment habits that consumers may have, Daily Youxian supports various payment methods such as WeChat, Alipay, Huabei, and Cloud Flash Pay to avoid hindering users' ordering process.

7.3.4 Scenario 4: What needs do consumers have after shopping? What functions has the platform launched?

When consumers just place an order and have not delivered it, they will inevitably encounter problems such as forgetting to use the red envelope, buying the wrong product/more/less, and selecting the wrong address. Therefore, after just placing the order, the order details will appear in the My Order Area in the "My" special edition. Consumers can cancel the order in time as needed and make another order again to avoid problems found after they have been delivered.

Consumers can also view the delivery progress during delivery to grasp the delivery progress in real time, so that users can feel more control.

After receiving the product after delivery, the product may be missed/incorrectly sent or dissatisfied with the quality. At this time, you can find the after-sales/refund function in the "My" interface.

If some customers want to issue invoices, the platform sets a button to issue invoices on my order interface, and consumers can issue invoices according to their needs.

7.4 Summary

By analyzing the structural brain map of MissFresh, we can know that there are four main scenarios in which users use MissFresh: before shopping, during shopping, during settlement, and after shopping. MissFresh can meet the needs of consumers well in the above four scenarios, and users in these scenarios pay different attention to certain functions (such as search function). Therefore, MissFresh's high-frequency functions required by different users have a high-frequency function and is distributed reasonably in the product structure, which can be considered a product with relatively excellent design.

8. Operational Path Analysis

As the saying goes, product operations are not divided. The saying "Products are responsible for giving birth, and operations are responsible for raising children" also reflects the close relationship between products and operations from the perspective of the situation. So how did MissFresh operate this product and achieve rapid growth in a short period of time? Next, we will sort out its main operating activities according to the AARRR model as follows:

8.1 A: Acquisition (user acquisition)

Get users’ daily new users mainly obtain two ways: large-scale advertising investment (paid channels) and excellent product reputation (free channels).

8.1.1 New Media Operation

There are many new media platforms now, such as WeChat and Weibo, and various self-media platforms. With the help of these self-media platforms, Daily Youxian analyzes the characteristics of target users and potential users, pushes content that these people like, and caters to their preferences to attract new and old users.

Example: MissFresh mainly launches brand promotional videos and recent events on the platform, and will also update some recipes.

In order to interact more than fans and improve the stickiness of fans, we will give some small gifts to fans every once in a while, which will increase the stickiness of fans and attract fans, and can also help the brand establish a reputation.

Daily Youxian will launch a platform series of short videos based on current festivals or social hot spots to promote Daily Youxian and increase the brand's influence.

2020.2, the epidemic documentary short film "Our Heroes", pays tribute to the ordinary heroes who are still sticking to their posts in the empty city of Beijing.

2020.4, the daily 5th anniversary short film "Thank you for your three meals and four seasons", showing the best wishes of Youxian members.

2020.5, Daily Youxian combined with Mother's Day to launch a short film "How much can you eat with your mother in life" to thank Mother's Day.

2020.7, a new brand film of Youxian Daily, "Make Life Fresh"

2021.2, Youxian released a short film, "Three letters from Brother Youxian"

8.1.2 Event operation

Gift red envelopes: Both parties can get coupons when inviting friends. More invitations will get more rewards, and invitation offers will be even more superimposed.

Member rights: Member rights upgrade, Wednesday membership day, etc. Launch a family card that can be shared by one person and a family.

In order to attract non-member users to place orders, users will be given coupons with shorter timeliness from time to time.

At the same time, there are a large number of other activities, such as discounts, purchases, etc., which are very exciting to users' consumption.

8.1.3 User Operation

Regarding the new recruitment of users, we have a detailed introduction in the commercial value analysis part, and will not go into details here.

8.1.4 Smart Operation

Based on the support of Tencent Smart Retail's "full touchpoint retail", MissFresh has devoted itself to creating "smart marketing"; full touchpoint operation has achieved precise delivery of social advertisements in the circle of friends, greatly optimizing its direct connection efficiency with users, reducing the cost of attracting new products by 30%. Using the social attributes of mini programs, MissFresh has achieved rapid social fission, and the mini program GMV increased by nearly 400% month-on-month.

8.2 A: Activation (improve activity)

After the user downloads and registers the app, he needs to activate the user to open the app. Daily Youxian actively carries out various holiday activities discounts, such as Double Eleven events, Mid-Autumn Festival gifts, Mother's Day special offers, New Year's goods festival, etc.; the event information of the "Today's flash sale" and "Today's fresh meat" sectors will give consumers a sense of high discounts, and the urgency of time will stimulate consumption. What to eat?” The community shared food tweets. While users received rewards and benefits, the platform also increased user activity.

8.3 R: Retention (user retention rate)

After obtaining a certain user scale, ensuring user retention is crucial. Daily Youxian mainly improves retention rate through its own membership system. Member privileges include free member dishes, member exclusive coupons, exclusive product price, Wednesday membership day, double points rebate, and unsatisfied refund. You can get points every time you place an order, and the Points Mall can use points to redeem products or red envelopes for full discount. These will attract users to give priority to using Daily Youxian to order products.

8.4 R: Revenue (acquire income)

The income of MissFresh mainly comes from users placing orders to purchase. When a user completes his first order and has a good impression of the product, he will buy a membership or choose to buy a wallet, then these customers will become core paid users and the repurchase rate will increase.

8.5 R: Refer (autopropagation)

In order to guide users to spread spontaneously, MissFresh mainly did the following: to help charity and create a good corporate image. For example, we signed pairing assistance cooperation agreements with Yanyuan County, Sichuan and Ziyun County, Guizhou, respectively. This is also the continuous implementation of MissFresh's "four ones" industrial poverty alleviation model. In 2017, Daily Youxian assists in adoption day, launching a public welfare package to help stray animals spend the winter. In August 2020, MissFresh helped the CPC Qingdao Municipal Committee Cyberspace Affairs Office to issue an initiative to "practice thrift and oppose waste" to the whole society in the form of television public service advertisements.

Daily Youxian user recommendations are mainly material recommendations. After recommending them to friends, both will receive corresponding coupons, which can greatly stimulate users to recommend. When the quality of the purchased goods is relatively good and the price is relatively favorable, word of mouth will be spread.

IX. Future Outlook/Optimization Suggestions

Through the above analysis, we understand the reasons for the rapid rise of MissFresh. So where will this unicorn go in the future? Next, we will use the SWOT model for systematic analysis, hoping to draw effective conclusions from it.

9.1 Internal Advantages (Strengths)

• The categories provided by MissFresh cover 12 major categories including vegetables, fruits, meat, poultry, eggs, aquatic products, wine and beverages, snacks, daily necessities, etc., which greatly meet the daily needs of users.
• The overall user experience of the app is relatively good, and it can meet the needs of users in different scenarios such as before, during and after purchase. It is deeply loved by users. Good user experience is the vitality of a product.

9.2 Internal disadvantages (Weaknesses)

Currently, MissFresh is mainly distributed in first- and second-tier cities, and its penetration rate in third-tier and lower cities is not very high. Because the cost of the forward warehouse is relatively high.

9.3 Opportunities

• Policy: With the country's strong policy support and inclination towards the cold chain logistics industry, China's cold chain transportation system will also develop rapidly. Building a cold storage network, improving operational capabilities, and fine-tuning warehouse management will become the development trend of the cold chain logistics industry.
• Society: Affected by the epidemic, downstream suppliers have turned to online, which will accelerate the development of fresh food e-commerce to a certain extent.

9.4 External Threats

Currently, fresh food e-commerce is in a situation where multiple models coexist. Affected by the epidemic, fresh food e-commerce has ushered in rapid development. At the same time, competition in the fresh food e-commerce industry will continue to escalate. For example, Dingdong Maicai and Hema Fresh are both developing rapidly and occupying a certain share in the market. E-commerce giants like this have started to sink their business models. For example, Taobao launched Taobao Making, which is based on Taobao’s large traffic, which will cause a certain diversion to Daily Youxian.

9.5 Summary

Through the above analysis, we can see that if MissFresh wants to continue to develop, it must optimize in the following aspects:

First of all, MissFresh offers a wide range of categories that can basically meet users' daily needs. In the future development, it will attract more high-quality businesses to settle in, which will increase the brand's influence and help improve user stickiness. While ensuring the variety and variety, we must strictly control the quality of the product to reduce the loss of users.

Secondly, in terms of attracting new customers, MissFresh currently mainly attracts C-end users. This type of user has greater uncertainty. We can see from the version 9.8.10 of MissFresh, in this version, the platform has launched an in-app purchase model for enterprise. It can be seen that the target users of the platform are not just the C-end. In the future development, MissFresh can take advantage of some of the advantages of other models, and it is crucial to explore users in other regions.

Finally, MissFresh’s forward warehouses are mostly distributed in first- and second-tier cities, so how to explore users in third- and fourth-tier cities will be crucial. Based on the fact that third- and fourth-tier cities do not have as fast-paced life as first- and second-tier cities, the pace and pattern of life are relatively slower. Daily Youxian can launch a "community group buying model" in third- and fourth-tier cities, and the community group buying model is generally a pre-order model.

First, recruit community group leaders in the community (for example, users who purchase frequently) and the main responsibilities of the group leader are:

1. The community leader collects user needs in advance, such as establishing group buying groups, mini programs, etc. The group leader will send some group buying information every day, from fresh vegetables and fruits to daily necessities, basically covering all aspects that need to be used in life;
2. The group leader will then deliver it to the user.

The reason why community group leader recruits in their respective communities is that if the group leader is a community user and is familiar with the people in the community, the products recommended or group buying will give other users a psychological feeling of guaranteed quality. Daily Youxian can establish a relatively complete community group buying system, and quickly cover products to each group leader’s store through the system, and then each group leader will sell the products to community residents, solving the pain points caused by orders, delivery, stocking, pickup, after-sales, and settlement from the actual level. This will expand the platform users of Daily Youxian and add a steady stream of motivation to establish a foothold in the market.

As a fresh food e-commerce company, MissFresh still needs to try to continuously expand new development formats, target different regions, so as to expand population coverage, improve service efficiency, and seize more market share in the fierce competition. This will improve your own moat. This can also form differentiated competition with direct competitors such as Dingdong Maicai, thereby consolidating one's own advantages.

Author: Roseanne

Source: Roseanne