Taobao Alliance Competitive Product Analysis Report

Online shopping has become a lifestyle for contemporary people, and e-commerce rebate products that return cash after shopping have also grown with this favorable trend. The author of this article chose two representative products of e-commerce rebate APP - Taobao Alliance and Huasheng Diary as comparative competitors, analyzed the two products from multiple aspects such as business model, market conditions, and users, and tried to find out their respective shortcomings and put forward his own suggestions.

1. Project Description

1.1 Competitive product analysis description

• Analyze the rebate platform market and user groups, understand user needs, explore user pain points, and derive core product functions;
• Analyze the competing products of the rebate app, understand the basic functions of the e-commerce rebate industry through direct competitors, and understand the special functions of the app through indirect competitors.

1.2 Product testing environment

2. Market Analysis

2.1 Industry Background Analysis

Figure 2-1 Transaction scale and growth rate of China’s online retail industry from 2010 to 2019

Data from the "2020-2026 China Online Retail Industry Market Development Plan and Marketing Channel Analysis Report" released by Zhiyan Consulting shows that the adaptability of online retail business models will become stronger and stronger , and online shopping has become one of the mainstream consumption methods in society . In 2019, the transaction volume of the domestic online retail market reached 10.32 trillion yuan, a year-on-year increase of 20.56% from 8.56 trillion yuan in 2018.

The growth of transaction volume in the online retail market has become increasingly slow, with a slight increase compared to the previous year, and the growth rate increased by 1.18 percentage points. The expansion of e-commerce platforms such as Pinduoduo, JD.com, and Alibaba into lower-tier cities and their internationalization efforts have promoted the growth of transaction volume. According to Zhiyan Consulting data, China's retail sales of consumer goods have grown steadily, reaching 41.2 trillion yuan in 2019. The proportion of online retail sales has also continued to rise. In 2019, online retail sales reached 10.6 trillion yuan, accounting for 25.7% of the total retail sales of consumer goods.

Driven by consumption upgrades and emerging technologies, the new retail industry is booming and a trillion-dollar market is accelerating . At present, the new retail industry is accelerating its integration between online and offline, and new marketing methods are emerging one after another, with overall characteristics such as omni-channel, digitalization, and socialization .

Summarize:

As the hottest entrepreneurial trend at the moment, social e-commerce relies on interpersonal relationships and acquaintance networks among users to achieve exponential growth, which can effectively realize dissemination and reduce the platform's customer acquisition costs . In 2019, online retail sales reached 10.6 trillion yuan, accounting for 25.7% of the total retail sales of consumer goods. The development of this data shows that China's retail has gone through the era of big retail, the era of low profit margins in e-commerce, the era of online retail, and the era of new retail . Social e-commerce has an important criterion for a good business model - creating positive value for society .

The commercial value created by social e-commerce lies in shortening the circulation of goods. It has changed from the previous model of circulation through multiple middlemen, which took a long time and resulted in high terminal prices, to a new S2B2C model , which reduces the links between people and goods , not only shortening the distance between the two, but also greatly improving user purchasing efficiency .

2.2 Industry Macro Environment Analysis (PEST)

(1) Policy

In terms of the macro environment, recently, 13 departments including the National Development and Reform Commission and the Ministry of Human Resources and Social Security issued the "Opinions on Supporting the Healthy Development of New Business Forms and Models, Activating the Consumer Market and Driving the Expansion of Employment" (hereinafter referred to as the "Opinions"). The "Opinions" propose to create a policy atmosphere that encourages innovation in employment models, support the public in carrying out micro-innovations based on Internet platforms, explore reasonable distribution of creative labor, reduce entrepreneurial risks, and activate the enthusiasm of the whole society for innovation, entrepreneurship and wealth creation.

The "Opinions" pointed out that we should actively cultivate new individuals and support self-employment. Further reduce the online entrepreneurship and employment costs for individual business operators and provide diversified employment opportunities. Support diversified self-employment and part-time employment such as WeChat business e-commerce, and online live streaming. Efforts will be made to stimulate the innovation drive and creative vitality of all types of entities, and to create a pattern of vigorous development in various forms such as part-time employment and side entrepreneurship.

(2) Economy

Figure 2-2 Growth of retail industry and e-commerce from 2016 to 2020

The share of e-commerce revenue in total retail revenue increased dramatically from 2.9% in 2015 to 4.4% in 2018, with e-commerce growing at 24% per year. In comparison, my country's Internet penetration rate was 60% in 2019, but online retail accounted for 20% of social retail. This shows that there is still huge room for development in the e-commerce industry of the Internet industry in the future.

(3) Society

Figure 2-3 Schematic diagram of the Silk Road

In September and October 2013, Chinese President Xi Jinping proposed the cooperation initiatives of building the "New Silk Road Economic Belt" and the "21st Century Maritime Silk Road" respectively. Relying on the existing bilateral and multilateral mechanisms between China and relevant countries and making use of the existing and effective regional cooperation platforms, the Belt and Road Initiative aims to borrow the historical symbols of the ancient Silk Road, hold high the banner of peaceful development, actively develop economic cooperation partnerships with countries along the route, and jointly build a community of interests, a community of destiny, and a community of responsibility with political mutual trust, economic integration, and cultural inclusiveness.

On March 28, 2015, the National Development and Reform Commission, the Ministry of Foreign Affairs, and the Ministry of Commerce jointly issued the "Vision and Actions on Jointly Building Silk Road Economic Belt and 21st Century Maritime Silk Road".

The construction of the “Belt and Road” initiative has promoted the attractive prospects of the cross-border e-commerce market. With the continuous advancement of the construction of the “Belt and Road” initiative, the industry generally believes that the cross-border e-commerce market will continue to receive policy support and is about to usher in a ten-year golden period of development. In fact, the Hangzhou cross-border e-commerce pilot zone has been approved by the State Council, and it plans to introduce a number of policies to promote market development. The establishment of free trade zones in Shanghai and other places will also gradually relax policies for cross-border e-commerce business.

Internet companies including Alibaba, JD.com, Amazon, and Vipshop have all launched cross-border e-commerce businesses . Pilot projects will be carried out in the transaction, payment, logistics, customs clearance, tax refund, and foreign exchange settlement links involved in cross-border e-commerce, which means that the development of cross-border e-commerce will be further "loosened" from the policy level.

Figure 2-4 China Internet Network Information Center (CNNIC), compiled by Zhiyan Consulting

According to the "Statistical Report on the Development of China's Internet", as of March 2020, the number of Internet users in my country reached 904 million, an increase of 75.08 million from the end of 2018. The Internet penetration rate reached 64.5%, an increase of 4.9 percentage points from the end of 2018.

(4) Technology

Figure 2-5 China Internet Network Information Center (CNNIC), compiled by Zhiyan Consulting

In March 2020, netizens aged 20-29 and 30-39 accounted for 21.5% and 20.8% respectively, higher than other age groups; netizens aged 40-49 accounted for 17.6%; netizens aged 50 and above accounted for 16.9%.

my country's high Internet penetration rate continues to penetrate (output) into the middle-aged and older age groups, and the 5G, artificial intelligence, and big data era will bring new major changes to Internet medical care. 5G makes the Internet wireless, remote and intelligent. Relying on the big data of the Internet online transaction shopping platform, it breaks the information island, discovers the needs of real buyer users in a timely and true manner, realizes the precision of online shopping platform services, and facilitates platform management and sellers to adjust online sales strategies in real time. Moreover, due to the inconvenience of travel during the 2020 epidemic, consumers' daily life needs also gave rise to more new ways of online transactions.

Summary: The 2020 coronavirus pandemic has spawned huge online consumer transactions. Now that the country has achieved a phased victory in the fight against the COVID-19 epidemic, Internet transactions including community shopping platforms have seen further development.

3. Business Model

3.1 Rebate Model

The rebate model is to convert the advertising amount based on the actual number of products sold , which is the CPs (Cost Per Sales) model. When users enter the shopping page of B2C merchants through this website, Fanli.com tracks the process of users purchasing goods, paying, and confirming receipt based on Cookies. After the user confirms receipt of the goods, the entire process is completed. The rebate website will deduct the advertising fee in proportion to the transaction amount and return a certain proportion of the advertising fee to the user. For example, the Taobao Alliance platform uses Taobao's own promotion channels (QQ, Weibo, websites, forums, etc.) to help Taobao sellers promote their products. After the promotion is successful, the sales volume will be counted by Alimama Taobao Alliance, and the commission will be paid to you according to the commission rebate ratio set by the seller.

3.1.1 Operational Model of Fanli.com

Innovation in business models does not mean complexity. Simply put, the business model of rebate websites is that when users enter B2C websites such as JD.com and Taobao through the rebate website portal to shop, they can receive rebates in the form of cash, points, etc. Its essence is a CPS advertising model.

3.1.2 Profit model of rebate websites

Analyzing the revenue sources of Fanli.com based on its operating model, we will find that its revenue includes:

Sales Commission: Fanli.com reaches an agreement with merchants through its cooperative online shopping platform. After users enter the cooperative shopping platform through the Fanli.com link and shop, Fanli.com can obtain a sales commission of the agreed proportion.

Advertising fees: Rebate.com triggers its users to shop on the cooperating online shopping platform . After the online shopping platform makes a profit, Rebate.com can obtain the agreed amount of advertising fees. In other words, Fanli.com advertises for major online shopping platforms and charges a certain amount of advertising fees.

Advertising rental fees: When other B2C platforms or others place advertisements on Fanli.com, Fanli.com will charge advertising rental fees.

The main source of income for rebate websites is sales commission , and part of the commission is returned to consumers in the form of rebates . The main profit model of rebate.com is to earn the difference between sales commission and rebate. Taoke Alliance mainly uses the form of Jifenbao, with a rebate ratio of 0.045-0.09. For example, if I buy a bottle of whitening essence of a certain brand, the price is 99.9, the commission is 4.5, and the ratio is 0.045; in addition, taxes must be paid before cash withdrawal. The specific settlement and withholding rules are as follows:

Enterprise account: that is, when the Alipay account you are currently using for payment is an enterprise account, Alimama will issue 70% of the payment at the end of each month, and the remaining 30% will be issued after the enterprise provides an invoice to Alimama and it is reviewed and approved (refundable within 3 months, such as the part settled on February 20, the refund must be completed before April 30 at the latest; the corresponding refund deadline for the last month of the year is special, that is, the part settled on January 20, the application must be successful before February 28 at the latest), the invoicing requirements and related rules are the same as the current ones;

Personal account : that is, if the Alipay account you are currently using to collect payments is a personal account, Alimama will deduct the amount based on your monthly billable income from promoting the above products in accordance with relevant laws and regulations, and report and pay it to the tax bureau on a monthly basis. Individuals are not eligible for tax refund applications;

Personal - Corporate Account : That is, the Alipay account you are currently using for payment is a personal account, but your actual income belongs to a specific company. Alimama will pre-withhold tax in accordance with the highest tax rate in relevant laws and regulations. You can apply for a tax refund from Alimama (including Taobao Alliance, Yitao, Daren Platform, etc.) through the "valid authorization letter of the standard template + compliant company invoice". The invoicing requirements and related rules are the same as the current ones. The pre-withholding tax will be refunded after the review is passed.

3.2 Membership Fee Model

Users can recharge their membership, and recharged members can receive no-threshold coupons every month, and can also get high cash back for daily consumption. Coupons can be received every day on certain merchant platforms, and they can also become premium members of some offline stores. In summary, users who recharge to become members can enjoy a series of value-added services and enjoy more discounts by spending very little money. How much is the recharge fee? If there is no unified price, write the current price of competing products on the market.

3.3 Product Selection Consultant Profit Model

A selection consultant is a person who is invited specifically, has certain product selection capabilities and provides product selection services to Taobao customers. Taobao customers under their team promote the products selected by the selection consultant. After the transaction is completed, the Taobao customer can obtain commission income, and the selection consultant can obtain product selection service fees.

Settlement rules:

1. The product selection service fee is the relevant service fee that the product selection consultant can obtain for providing product selection, guidance, training and other services to the Taobao customers under the team. Taobao authorizes Alimama and/or Alipay to deduct the product selection service fee from the commission income that can be obtained from the products selected by Taobao's product selection consultants. The product selection service fee that the product selection consultants can actually obtain shall be subject to the actual payment.
2. Settlement time: The product selection service fee is settled on a monthly basis, once a month. Generally, the product selection service fee for the previous natural month is settled on the 20th of each month;

4. Users

4.1 Purpose

Through user attributes, we can explore the essential needs of users and derive core functions; secondly, we can use user scenarios to analyze user pain points and extend special functions.

4.2 User Segmentation

Figure 4-1 2019 Rebate Platform User Survey (Data source: collected and sorted by TouBao Research Institute)

(1) Gender structure

Figure 4-2 Gender structure of online shopping users in 2019

From the chart analysis, it can be seen that the current users who use rebates are mainly women, with female users far outnumbering male users. Female users account for 73%, while male users are only 27%. This can be analyzed from the perspective of consumers' shopping psychology . Compared with male users, female users have a stronger desire to get rebates.

Summary: Nowadays, more and more people are shopping online, and more and more online shoppers are paying attention to the price discounts of online shopping. After investigation, it was found that rebate products are still mainly used by 73% of female users . This is mainly because women love to consume, are not rational in consumption, and are prone to impulse consumption.

(2) Age structure

Figure 4-3 Age composition of rebate platform users in 2019

The survey found that most of the users who received rebates were young users between the ages of 18 and 39, accounting for 95%. Among them, users between the ages of 18 and 29 account for 59%, and users between the ages of 30 and 39 account for 36% (see Figure 2 for specific analysis results).

Summary: Users of rebate apps are mainly young people , with the main age group being 18-39 years old. This age group will participate in consumption and use rebate consumption software due to multiple factors such as shopping needs and competitive psychology.

(3) Occupational structure

Figure 4-4 Online shopping occupation composition in 2019

The survey found that the user groups who use rebates are mainly employees of enterprises and institutions and students. These two groups account for 80% of the users of rebate websites. Among them, employees of enterprises and institutions accounted for 69% (general employees of enterprises accounted for 39%, enterprise managers accounted for 12%, and government or public institution personnel accounted for 17%), and students accounted for 12% (see the above figure for specific analysis results).

Summary: The user groups who use rebates are mainly employees of enterprises and institutions and students , accounting for as high as 81%. Enterprise employees have relatively easy work tasks during working hours and relatively free spare time. Students are mainly over 18 years old and their academic qualifications are mainly in college. They have relatively free spare time and are easy to watch some live broadcasts or recommend products by anchors, which can easily lead to consumption. They are more likely to use rebate products because they seek convenience in life and low prices.

(4) Income structure

Figure 4-5 Income structure of online shopping users in 2019

The survey found that users of rebate products are mainly low- and middle-income groups with monthly incomes of 1,000-5,000 yuan, among which the income group of 2,000-3,000 yuan has the highest proportion, at 29% (see Figure 4 for specific analysis results). This income structure is consistent with the positioning of rebate products.

Summary: Compared with high-income groups, the core positioning of shopping rebates for rebate products is more attractive to middle- and low-income consumers . The main reason is that compared with middle and low-end consumers, consumers with middle and high consumption levels are more inclined to select product quality.

(5) Online shopping experience

Figure 4-6 Online shopping experience structure of online shoppers in 2019

It can be seen from the chart that most users of rebate products are consumers with rich online shopping experience. Users with more than three years of online shopping experience account for 80% (users with 3-4 years of online shopping experience account for 34%, and users with 5 years and more of online shopping experience account for 46%). Consumers without online shopping experience will not use rebate products as a channel to meet their needs.

Summary: Through our research and analysis of users who use rebate apps, we concluded that: based on a comprehensive analysis of users' gender, age, occupation, income and online shopping experience, rebate apps are mainly used by female users with low to medium consumption levels and rich online shopping experience, such as students and employees of public institutions between 18 and 39. Of course, this also shows from one aspect that the ability of product functions to meet users' shopping needs is an important basis for future product development.

(6) User Profile

Image 1:

Basic attributes: Female, 20 years old, a college student

User behavior: Online shopping for myself and my parents

User characteristics: Those who have three years of online shopping experience

User scenario: Xiaofang is a senior student. She is an avid online shopping fan. She buys daily necessities, skin care products, clothes, etc. for herself and her parents. She likes to watch Li Jiaqi's live broadcast because she can buy good things in his live broadcast room at a very low price. However, there are always some things that cannot be bought in the live broadcast room. This makes Xiaofang very worried. Are there no discounts for these things that cannot be bought in the live broadcast room? The discount is not big. She was muttering to herself, and her roommate said: "For the sake of our friendship for so many years, I will share with you a great app I recently discovered, that is Taobao Alliance. Let me tell you, just copy your link and open this software, and the corresponding discount link will pop up automatically." Xiaofang quickly took out her mobile phone and downloaded a Taobao Alliance. "Wow! Really, I logged in directly with my Taobao account. It's so convenient to search. Just copy and open Taobao and you can use it. It's great!"

Image 2:

Basic attributes: Male, 25 years old, unmarried, an employee of an Internet company

User behavior: shopping online for myself, searching for coupons for many people

User characteristics: An employee of an Internet company

User scenario: Zhang Wei is an employee of an Internet company. Because his girlfriend often shops online and is always searching for coupons, he downloaded the Taobao Alliance app last year after hearing the recommendation of a good friend. He has been posting some discount links on his Weibo. Now he has tens of thousands of Weibo fans, so he discussed with his girlfriend to post some reviews to attract more users to add their Weibo, which can be a considerable side income.

Image 3

Basic attributes: Female, 28 years old, married, employee of a company

User behavior: Online shopping for myself, my husband and my children

User characteristics: Employee of a company

User scenario: Chen Yifei is an employee of a company. She likes shopping in her spare time. She goes shopping and visits selection stores to see what her children need and buys some clothes for her husband. However, she has to wait for a long time for the stores to have promotions before stocking up. However, when there are no promotions, she always feels that it is not cost-effective. After the colleague sitting opposite her learned about her troubles, he told her: "That's a piece of cake. I found an app called Taobao Alliance some time ago. You can search for coupons if you want to buy something for your children. You don't have to wait until there are promotions. There are hidden coupons that many people don't know about!" Chen Yifei thought it was very nice, so she downloaded the app and found that online shopping saves a lot of money than offline shopping. She no longer has to wait for promotions and can buy whatever she wants.

(7) User pain points

1) Want to find a rebate platform with the best cost-effectiveness

Taobao and other shopping apps have become the mainstream shopping software in people's daily lives. However, the same product has different prices on different shopping apps, and it is easy for many identical products to appear. Users cannot quickly find and consider which shopping app to buy the product or find a more suitable and cost-effective rebate platform, and cannot create benefits for themselves through existing shopping apps.

At the same time, for a large number of users, choosing the product they like requires a lot of thinking, such as checking buyer reviews, buyer shows, and spending time thinking about whether the quality is appropriate. When a product is chosen, being dissatisfied with the price is a major pain point for the user.

Not only that, for many users, in addition to being able to buy the high-quality and low-priced goods they want, they also need an APP that can invite their friends to join in the purchase by sharing the goods to their circle of friends. In this way, when they share the good goods they have recommended with their friends, not only can their friends choose to buy them on their own, but the users themselves can also get a portion of the commission after the purchase. While recommending it to your friends, you can also save some of your living expenses, which is a very cost-effective thing.

2) Offline shopping cannot obtain accurate discount information immediately

Although online shopping occupies a large part of the shopping market, offline shopping has always been an indispensable part of people's daily life. There are many offline supermarket stores and various promotional activities emerge in an endless stream. As a consumer, there are two pain points. One is that you may not know which supermarket is offering a discount, and the other is that you cannot choose the supermarket with the best discount among the many discounts. In other words, the user's most core demand is to buy what they need at the best price.

5. Product-Competitive Product Analysis

5.1 Product Strategy Analysis

5.2 Product Function Structure Diagram Analysis

5.2.1 Taobao Alliance Functional Structure Diagram

5.2.2 Huasheng Diary Functional Structure Diagram

Summary: Taobao Alliance is an app under Alibaba that mainly provides coupon search and rebate services. It mainly promotes sharing coupon search and rebate with friends, and does not have many social interactive function designs ; Huasheng Diary is an intelligent shopping guide app for products on an e-commerce platform.

Suggestion: Taobao Alliance can be optimized in terms of functions, such as: optimizing the live broadcast function, optimizing the circle of good things, adding a category, one part of which is the circle of good things recommended by the platform, and adding a category of sharing good things recommended by social friends . At the same time, the social function can be optimized , and friends who often share good things can be automatically generated as friends or added as friends by default. Socializing can be carried out, and the sharing or shopping experience visible to the other party can be seen, which can be used as a reference for your own shopping.

5.3 Product Function Comparison

5.3.1 Home page function comparison

1) Taobao Alliance Home Page

The banner area at the top of the Taobao Alliance homepage is narrow, the layout is clearer, and it is more comfortable to use. There are fewer icons in the central visual concentration area, which is less likely to cause visual fatigue to a certain extent, and the user experience is better. In the welfare shopping section, the flash sale time reminds users that time is counting down and discounts are being lost, which can easily cause users to feel nervous when shopping and prompt them to place orders. The interactive layout of the commission part is more obvious than the flash sale price next to it, and the color is more prominent, which makes the user notice that the rebate commission is very high, prompting the transaction and the process of attracting users to complete the transaction and obtain commission.

2) Huasheng Diary Home Page

There is a banner at the top of the Huasheng Diary homepage, with three rows of icons in the middle visual center area, which is visually blocked. There is a peanut headline in the middle, which attracts users' attention and can drive some customer traffic to a certain extent. Below is a selection of good products. This part of Taobao Alliance and this section of Huasheng Diary are similar in nature. Both of them emphasize the core function of this product to a large extent - searching for coupons and rebates. However, the difference is that Huasheng Diary aims to build itself into an intelligent shopping guide APP for e-commerce platform products.

Summarize:

By comparing the homepages of the above two apps, it is not difficult to find that each rebate product has one biggest feature - its main visual layout is very similar to that of shopping platforms such as Taobao. Among them: although the homepage interface of Taobao Alliance has borrowed from Huasheng Diary and Fenxiang Life, it has also been optimized. Its advantages are: the homepage is relatively simple, and the core function of searching for coupons and rebates is clear.

Taobao Alliance mainly provides rebates and commissions, supplemented by product selection services. The fundamental reason for this is that it is affiliated with Alibaba Group and has gathered a large amount of e-commerce marketing effectiveness data and experience. Huasheng Diary mainly uses coupon search and rebate to attract traffic, develop its own unique functions, and build a comprehensive platform.

5.3.2 Home page function comparison

1) Taobao Alliance Good Products Circle

Taobao Alliance’s Good Product Circle is a good product recommendation platform that selects and updates it daily. Its advantages are: simple interface, easy for users to copy and send, and the platform filters and updates recommendations daily, saving users time in filtering and viewing. Its shortcomings include: no classification and screening of sections, fewer choices for users, only products pushed by the platform can be selected, and the quality is not guaranteed. The specific operation process is as shown in the figure, but Taobao Alliance is currently only limited to sharing on WeChat.

Summary: Taobao Alliance's Good Products Circle is currently in the stage of self-control by the platform, so the content is more about the selection of products by backend editors. In the future development direction, some OGCs can be selected to control product selection, select categories under quality control, and enrich the platform's Taobao affiliate publishing and traffic.

2) Huasheng Diary Pollen Community

The Pollen Community section is divided into three categories: hot-selling products, good products, and promotional materials. Each category is further classified according to the content: real inspection photos, Pinduoduo direct mail selection, etc., which are clearly categorized and organized. The names of the publishers are also different: Editor of Huasheng Diary Academy, Health Expert Huanhuan, and Life Expert Xiaoyou, which brings them closer to users and increases the sense of intimacy. And design a forwarding volume display to give users a certain amount of choice. Its advantages are: clear categories, high user familiarity, and easy to retain users. The design displays the forwarding volume, giving users ample room to choose. The shortcoming is that the link cannot be copied directly on the good product recommendation interface, and a jump is required , which increases the complexity of user clicks and reduces user stickiness. If there is a more convenient platform, user loss will occur.

The sharing jump of Pollen Community is different from that of Taobao Alliance . The forwarding and sharing on the upper right corner will increase once you click it, regardless of whether you actually jump or share it. In this way, the ranking of this product will be higher, and more Taobao agents will choose this product to attract traffic.

Summary: Huasheng Diary's Pollen Community is richer. Product selection follows the classification navigation guide. There are many product categories and sufficient categories . There is a large choice space for Taobao agents. Pinduoduo and JD.com can also be chosen, and promotion and traffic can be carried out according to the users' own wishes. Moreover, each jump is smooth, which can be said to be a function optimized on Taobao Alliance. Copying text can save videos and pictures. In addition, sharing can also be multi-channel sharing , which is convenient for Taobao users to share and divert traffic through multiple channels and create more value for the platform.

6. SWOT Analysis

6.1 S Advantage: Providing consumers with more shopping benefits

This is also the most critical means for rebate apps to attract consumers. Through the rebate APP, consumers can get cash back, physical goods, points and coupons after shopping. Compared with traditional online shopping methods, this model undoubtedly greatly stimulates consumers' shopping enthusiasm.

Consumers are accustomed to shopping on one or two e-commerce websites and rarely come into contact with other e-commerce shopping apps. This is because shopping on other e-commerce apps requires registration and login, which is a cumbersome process. However, shopping through Youmai can solve this problem well.

By using the joint login service launched by the platform, consumers only need to log in to the rebate website, and then they can use the account of the rebate website to log in to all e-commerce shopping websites that cooperate with the rebate website. Generally, large rebate websites cooperate with hundreds of e-commerce shopping websites. This means that consumers can shop on hundreds of e-commerce shopping websites and get rebates by logging into the rebate platform, which is both convenient and labor-saving.

6.2 Disadvantages of W: High rebate threshold and long cycle

The rebate period for rebate websites to consumers is longer. Usually, after consumers shop through rebate websites, they have to wait for confirmation from upstream merchants before receiving the rebates. Therefore, it often takes about two months for the rebates to be credited to their accounts.

Many rebate websites set certain thresholds for consumers to apply for rebates. For example, some rebate websites require the rebate amount to reach 10 times before applying for rebates. That is to say, if the rebate amount is less than 10 yuan, consumers cannot apply for rebates and can only wait for the next round to accumulate the amount to 10 yuan.

6.3 O Opportunity: Rapid Development of E-commerce

E-commerce is developing rapidly in my country, and online shopping has been integrated into people's lives.

According to iResearch Consulting data, the transaction volume of China's online shopping market reached 1,304.0 billion yuan in 2019, an increase of 66.2% over previous years, accounting for 6.2% of the total retail sales of consumer goods.

The rebate marketing model is an inevitable product that emerges when e-commerce develops to a certain stage. Its emergence further allows consumers to experience the benefits and convenience of online shopping, which is also the main driving force for the long-term development of the rebate industry.

6.4 T Threat: From Partners

Merchants who cooperate with rebate platforms will consider this problem: after consumers have purchased their favorite products on shopping websites, they will seek discounts on rebate websites and then go shopping on e-commerce websites. This will cause the users of the e-commerce websites to slowly transfer to the rebate websites. When the rebate websites have enough users, they will have the capital to ask the e-commerce websites for more product sales profits, or set up their own business. However, this result is not what the e-commerce websites want to see.

VII. Conclusion

Taobao Alliance is no longer limited to the previous "Taobao Affiliate" format. As mentioned in the Blue Whale Plan, it will consider combining with Taobao's advertising alliance. The target is no longer just individuals who have time and internet access. In the future, it will cooperate with major websites. "Taobao Alliance will consider introducing a variety of forms including commercial search, P4P, diamond booths, and Maiba to attract small and medium-sized webmasters and network practitioners. The long-term positioning of Taobao Alliance is conducive to its long-term development.

Author: Alphabet List

Source: Alphabet List