Taobao Live is not a panacea!

At the end of last year, I was still attending various major media summits. Once at 36Kr's Chongqing open business class, I met Zhao Yuanyuan, who had just transferred from Ogilvy to Taobao Live as the person in charge. He had just rushed in from the previous venue with a schoolbag on his back, and tried his best to explain to the audience what "Taobao Live" was, but the people below looked confused.

Later, the world was gradually opened up - this year's new marketing method started with the keyword "private domain", and the hottest one was "Taobao Live". If you still don’t know what Taobao Live is, let me give you a brief introduction: Taobao Live is a form of e-commerce live shopping where you can watch and buy on Taobao. It is the Taobao version of TV shopping. There is no need for me to introduce the two most famous top anchors on Taobao Live this year: Viya and Li Jiaqi.

In January this year, I mentioned Li Jiaqi in the "Comparative Report of US and Chinese Beauty Bloggers" that he was just beginning to make his mark. Because of his handsome face, sales skills accumulated over the years, and the combination of Douyin and Taobao live streaming, he opened up the market and became a household name.

But unexpectedly, starting from the first quarter of 2018, Li Jiaqi's popularity grew, and together with Wei Ya, he led to the rapid growth of the entire Taobao live streaming ecosystem. As shown in the figure below, the year-on-year growth in sales in 2019 was close to 400%...

▲Data from Taobao List x Taobao Live

Under this trend, many celebrities and stars have entered the industry. In addition to the Weibo celebrities I studied before, such as Zhang Mofan, who have joined Taobao Live and started broadcasting regularly, celebrities have also joined the live broadcast room - whether it is the host Li Xiang, the childhood memory of the post-90s, or the favorite Running Man Wang Zulan of the post-95s, they have all entered the live broadcast room. (Next, the virtual idols that the post-00s like should get ready and start selling goods)

▲Li Xiang invited Zhao Wei to the live broadcast room

Amid this nationwide enthusiasm, brands began to "get excited" and rushed to Taobao Live, fearing that they would miss out on this wave of dividends. Recently we visited an old state-owned enterprise, and the marketing director of their company excitedly told us that they had already formed a team and were ready to launch a large-scale attack on Taobao Live.

History always repeats itself in a surprising way: with the so-called traffic dividend, anxious merchants will inevitably treat something as a panacea like crazy: before it was growth hacking, then private domain traffic, and recently Taobao Live...

I have always believed that if we want to play a game well and think clearly about how much manpower, financial resources and energy to invest, the first step must be to help brand owners see the essence of a game. For example, I have previously written an article titled "The Essence and Gameplay of the 2019 Popular Slang "Private Domain Traffic"". In this article, we will talk about the nature and gameplay of Taobao Live.

Taobao Live is not a "panacea". Its essence has been said countless times to be "TV shopping guide", but it doesn't make any sense. Which link can it replace in our marketing chain, what role does it play, and what are its future limitations?

1. Mainstream gameplay of Taobao Live

Broadcast live broadcasts by anchors and brands

To put it bluntly, there are two main ways for brands and merchants to play Taobao Live now: using expert anchors or merchants to broadcast themselves.

To place an anchor is to find an anchor like Li Jiaqi/Viya to help you recommend your product in his live broadcast room. For example, the typical price of Li Jiaqi’s recent Double 11 promotion is:

To be honest, it is still quite cost-effective. For example, when we tried to find a top female influencer on WeChat for promotion, the price was over 700,000 yuan, and there was no way to get any sales share.

Li Jiaqi's income mainly comes from listing fees and commissions. The commission is equivalent to CPS (Cost Per Sale), which means that a commission is charged for each sale. It’s more secure for merchants and feels like a win-win situation.

How do anchors like Li Jiaqi attract audiences?

The anchor will spend a long time trying out the products before the broadcast, and then spend a long time communicating with the merchants to get the lowest price for the merchant’s popular products, or more gifts than on the market, so as to grasp the user’s itch points - "always get the lowest price in Jiaqi’s live broadcast room."

At the same time, what is popular this year is the combination of short videos and live broadcasts. Some clips from the live broadcast are extracted and put on short video platforms such as Douyin and Kuaishou, and the content is used to increase distribution and drive traffic to Taobao live broadcast stores.

Thus, the user-anchor-merchant link is formed: users wait for low prices here, anchors recommend good products, and share profits with merchants to ensure "product and effect integration".

In addition to advertising, brands can broadcast their own content. To put it simply, merchants can find anchors with sales experience based on their own stores, and do e-commerce live streaming sales to store fans - creating their own store live streaming platform. For example, I often see Perfect Diary. I personally think that their anchors and overall live broadcast arrangements are relatively standardized.

▲On the left is Perfect Diary’s own live broadcast, and on the right is the popularity ranking of store live broadcasts (as of November 4)

This style of play is now basically standard. According to data released by Alibaba, 17,000 brand stores used live streaming marketing on Double 11 this year. Often businesses will set a time point and then cultivate user habits, and use various big prizes, scheduled draws, and must-buy reminders every hour to keep users watching.

The self-broadcasting by merchants is also where Taobao Live diverges from traditional live broadcasts of the past. Zhao Yuanyuan, the person in charge of Taobao Live, once mentioned: More than 90% of the live broadcasts on the Taobao platform are self-broadcasts by merchants, rather than live broadcasts by experts. This is completely different from the shows (live broadcasts) outside.

2. Why is Taobao Live so popular?

The essence is that I am afraid of being cheated by other channels.

Why is Taobao Live so popular? Taobao Live is essentially a new 3.0 content carrier in addition to 1.0 pictures and texts and 2.0 short videos : an "upgraded version of TV shopping." Why is TV shopping good? Because of high monetization efficiency.

Compared with the original text, image or video carriers, Taobao Live has obvious advantages: real-time interaction + video presentation, which makes it easy for anchors to promote products, promote with a sense of urgency, and create visual stimulation.

For example, the top blogger on WeChat used to be "Shiliupo Report". She was very good at using her own knowledge and insights to recommend various luxury bags. She could also often throw out some discount codes to promote products, but the output was often one-way, and the perception that could be achieved through pictures and texts was also very limited.

However, in Taobao live broadcast, a trick Li Jiaqi often uses is to say "Estee Lauder is giving away 4 samples this time, and Jiaqi's live broadcast room will add two more!" While saying this, he will put the samples in a row in the live broadcast and repeat it over and over again. Unconsciously, you will have the feeling of "How can they give away so many? What a good deal!!"

Secondly, after putting a product on the shelves, Li Jiaqi will say "There are only 10,000 sets this time!" After putting it on the shelves, he will shout out in real time "There are only 6,000 sets! 5,000! 4,000!" Once I wanted to buy something, and he shouted like that, I was so scared that my hands started shaking immediately. I wanted to grab it quickly for fear that it would be out of stock.

This kind of real-time stimulation makes Taobao Live destined to crush the original pictures, texts and videos in terms of transaction results.

Taobao Live, an "upgraded version of TV shopping", essentially adds "promotional perception" that cannot be achieved by original pictures, texts and videos, thereby speeding up the efficiency of monetization.

Moreover, Taobao Live can monetize faster than TV shopping...

1. Taobao Live has shortened the barriers to purchase when shopping on TV (no need to make a phone call);
2. Eliminate the price information gap in the past (you can find out how much it costs by searching online);
3. And it adds real-time interactivity (you can talk to the host through chat).

What new hope does the emergence of Taobao Live bring to merchants? It can gradually get rid of the dependence on Weibo, WeChat and Douyin, which are already inefficient and do not promise sales, and speed up the monetization of new and old users.

In the past marketing environment, the means we used to attract new customers when selling consumer products was also known as "planting grass" - completing the placement on social platforms such as "WeChat, Weibo, Douyin, and Kuaishou", or placing direct trains or diamond exhibitions on Taobao to divert traffic to Taobao stores to complete transactions, the so-called "planting grass across the entire network, and completing transactions on Taobao". Then we will use Weibo, Weibo, and Douyin to promote activation in our brand's "private domain".

But now there are many problems with this overly long path:

1. The data and opening rates of Internet celebrities are all real and fake. The halo of top bloggers is also dimming, and conversion cannot be guaranteed. It is becoming increasingly difficult to attract traffic on various platforms, and even after attracting traffic to Taobao, purchases may not necessarily be generated...
2. It seems like the two Weibo posts are just for self-entertainment, and no one is watching at all.

But now with the emergence of Taobao Live, Weitao and other Taobao columns, merchants have seen new hope.

First of all, the emergence of Li Jiaqi, a phenomenal anchor, is equivalent to Mimi Meng in the sales industry, and traffic conversion is guaranteed. By investing in Li Jiaqi, you can get a one-stop service that covers the entire chain from attracting new customers to monetization to recommendations.

In Taobao Live, suppose there is a product you didn’t know before. After listening to Li Jiaqi’s explanation, you learned what it is and how useful it is. Then, because the price is discounted on the spot and the opportunity is rare, you immediately place an order and share it with your friends. Doesn’t this mean that the entire process from being interested to understanding to purchasing is completed at the same time?

Brand stores’ own live broadcasts have become a type of video-based flash sale program, which can then target the store’s old users to promote activation and repeat purchases, solving the problem that the store’s millions of users were like zombies and could not be reached.

And by grafting onto Taobao's public domain traffic of more than 200 million DAU, as long as the stores and influencers perform well, they can get more official traffic. This good thing immediately gives many brands an adrenaline rush.

3. Limitations of Taobao Live

It is difficult to copy the top brands, so don’t be too proud of yourself

From this perspective, the "one-stop solution" provided by Taobao Live seems to be a panacea that can solve the growth crisis of major consumer products. But in fact, the limitations are also very obvious - first of all, how big is the audience for e-commerce live streaming?

One of the biggest drawbacks of live shopping is that it takes up a lot of your time waiting for an explanation that will inspire you. No matter how bored you are, you don't have to sit there every day and listen to others telling you about advertisements, right?

Compared with game live streaming and companionship live streaming, Taobao live streaming makes users feel guilty about buying things, and its audience is not very wide.

Let’s take a look at the live broadcast viewing data of Li Jiaqi, the most "addictive" person in the past month. It only reached 30 million on the day when the pre-sale was opened for Double 11, and then fell sharply back to the starting point.

Let’s talk about the brand’s own live broadcast... Will there really be people who often watch your promotion?

As a consumer, when I pass by a counter, I feel annoyed even when the salesperson at the counter promotes something to me. Why would I stay in your live broadcast room to listen to you? I just want a discount. Moreover, most anchors’ skills are not up to par, and there are only a handful of professional live broadcasts that can make people “intoxicated”. I once saw a live broadcast by a first-generation internet celebrity, who hadn’t even memorized the product parameters and was stuttering. I quit the live broadcast, thinking, sorry for disturbing you…

Unless you make high-quality programs in the live broadcast room and transform it into PGC, it is not a shopping live broadcast but a brand investment. Why do you have to do Taobao live broadcast? This is not the advantage of Taobao live broadcast at all.

Since self-broadcasting doesn’t work, let’s invest in professional anchors. However, the head effect of professional anchors is too obvious. You can see the anchor popularity ranking on October 21 (the first day of Double 11 pre-sale). The popularity has dropped sharply since the third place, and is less than 10% of the second place Li Jiaqi (3~5 were also the top Internet celebrities of the previous generation).

As the top stars, Li Jiaqi and Viya are difficult to replicate in my opinion. They must have good looks, traffic, the ability to select products and the eloquence to make sales. Perhaps only variety show hosts can compare to him. The more obvious the head effect of the anchors is, the more they will tend to choose top brands, and small brands will have fewer and fewer opportunities in the future.

There are currently some mid-level anchors who can be placed, and perhaps a few top anchors can emerge in the vertical field. Nowadays, many brands will also look for mid-level anchors to place their ads, and at least the ROI can be guaranteed to be around 1:1. However, they may be affected by the Matthew effect, which is not a long-term solution. At most, it is just a small sales channel.

The rise of Li Jiaqi does not mean that Taobao Live as a whole has any opportunities, and the audience for live shopping will be as limited as TV shopping. Brand-run live broadcasts will most likely end up like the two Weibo and one Douyin: self-entertainment.

In my opinion, the current popularity of Taobao Live is due to Alibaba’s traffic support behind the scenes to cultivate user habits, coupled with the strength of the Double Eleven promotion. Today's Taobao Live is actually a miniature of a large-scale rap and promotion scene.

4. Brand building is the deepest way to plant seeds

Putting aside the superficial bubble, the recent popularity of Taobao Live has been largely driven by the Double 11 promotion: the limited-time and limited-quantity discounts have made the adrenaline of the onlookers soar, and major brands have also offered the best discounts. What "Li Jiaqi" does is nothing more than recommending and promoting the star products of big brands - and he still plays the role of a sales clerk.

Let’s think back to those brands that have performed outstandingly in “selling goods” recently. What we don’t see behind their selling goods is their early process of promoting the products. Before this, Estee Lauder signed popular stars such as Yang Mi, Li Xian, and Xiao Zhan in succession to mobilize the enthusiasm of fans. In addition, it also spared no effort in the placement of outdoor advertising and new media advertising... Don’t these actions have the credit of planting grass?

Since 2016, Olay has streamlined its product line and focused on "anti-aging", launching new products such as air cream and small face essence. At the same time, marketing has followed closely, and it has fully promoted the brand concept of #fearless of age#. After a few years, it has gradually reversed the "brand used by moms" and occupied the minds of young people... Isn't this the core factor that makes the product sell well?

In the recent live broadcast room, I also saw "light luxury products" with high customer unit prices such as Chow Tai Fook's pure gold bracelets and Armani's starry sky watches. Their brand awareness is not built in a day, but comes from the sense of presence you have created when shopping in malls and on the streets countless times. Otherwise, the discount alone is not enough to make you pay thousands of dollars to watch the live broadcast.

At this stage, the success of Taobao Live is actually more of a "concentrated harvest" for brands, and more effort was spent on the front end. If you want to successfully pull out the weeds, you must plant the grass deep enough - first build a brand empire, so that you can stand out from the crowd.

The "limited time, limited quantity, limited price" that makes people excited during live broadcast is more like a hook to achieve the final conversion. Everyone will be happy to see the sales volume at the harvest, but you cannot ignore the early sowing, watering and fertilizing. These are all silent brand building. No one can harvest directly without sowing.

Reaping the benefits of live streaming is like putting your products on sale in a hypermarket and letting shopping guides lead consumers in their selections. It can generate cash quickly, but hypermarkets can never build a brand.

As Yuanyuan herself said in a recent comment under an article by my good friend Li Yi - "This is why e-commerce platforms cannot incubate e-commerce brands. Building a brand in a market full of red envelopes and coupons is as difficult as singing opera in a vegetable market."

In the live broadcast room, 3-2-1, 10,000 copies were put on the shelves and they were all sold out.

It is easy to release potential energy. Going downstairs is always easier than going upstairs. However, the accumulation of brand assets is a process of hard work and rewards.

Author: Daojie Doris

Source: Daojie Doris