What is social commerce? Social commerce review

Core Advantages

"Content stickiness that is closer to users."

Development Trend

The model of Business 1.0 is: "production-oriented business model", the traditional business model from 1990 to 2005.

The model of Business 2.0 is: "Business model based on Internet configuration", which is the e-commerce model from 2005 to 2012.

Commerce 3.0 is: "a business model based on anytime, anywhere experience", the mobile e-commerce model after 2012.

Commerce 4.0 is: "A personalized business model based on interest-based shopping guides based on content communities", the C2B community model after 2016.

From the e-commerce "production model, to the Internet configuration model, to the anytime, anywhere model, and then to the recent interest-based shopping model", we can find that the new model is "closer to users" than the past model and it is more convenient to meet user needs.

Statistics show that in 2014, the scale of social e-commerce reached 96 billion yuan, with 9.16 million merchants. In 2020, the scale of social e-commerce merchants in my country will reach 24 million, and the market size will exceed one trillion yuan. In the next three years, the industry will have more than 10 times of room for expansion.

model

1. Group buying

It is to promote products through group buying model.

Currently, social e-commerce platforms that meet the group buying model include Pinduoduo, Taobao Special Edition, JD Group Buying, and Juyou Group Buying.

2. Content e-commerce

Content e-commerce is mainly driven by content, based on the formation of communities based on common interests. It attracts a large number of users through high-quality content and completes the monetization model through guidance.

Currently, the most successful social content e-commerce is mainly in the vertical segments: Xiaohongshu, Youchehouyi, etc.

3. Distribution

What is distribution? It means establishing sales channels, which refers to the process of transferring a certain commodity or service from the producer to the consumer, and obtaining ownership of the commodity or service to help transfer ownership to all companies and individuals.

Social e-commerce companies that currently adopt this model include Miaya, Youhaowujing, etc.

4. Mini Programs

Based on the WeChat ecosystem, it has its own social attributes and has achieved a fission-like explosion through social networks, completing the seamless connection from social to e-commerce. Whether it is group buying, bargaining, or content e-commerce, it can be achieved through mini programs.

The group-buying model helps users to move deeper into the market, the content model improves user stickiness, and KOL distribution improves user loyalty.

Advantages

1. Social e-commerce has a low threshold

Social e-commerce only requires a few hundred yuan to become a member and enjoy the promotion rights. Before a meal, you can start making money with just a mobile phone. The threshold for starting a business is very low and anyone can do it.

2. Social e-commerce has high operational efficiency

One of the core elements of social e-commerce is the transmission of information between people.

3. Social e-commerce platforms have more complete functions

The social e-commerce platform integrates social, payment and e-commerce platform functions.

4. Social e-commerce platforms are more interactive

As long as fans of social e-commerce platforms follow the official account or shopping mall platform, merchants can publish discount information or promotional activities through the background and push them to customers in a timely manner, so that customers with needs can participate in the activities at the first time. Therefore, social e-commerce is more superior in terms of interaction.

Disadvantages

1. Difficult to manage

The threshold for becoming a distributor or agent is not high, which leads to the common phenomenon that practitioners are of varying quality and have different abilities.

2. The income level of individual practitioners determines the sustainability of the model

The most eye-catching thing in the WeChat Moments is the income posted by WeChat merchants, either screenshots of transactions of tens of thousands or hundreds of thousands, or photos of cars and houses bought, boasting about their dedication while criticizing others for not working hard. The combination of pictures and texts makes countless people excited and unable to resist the temptation to join the agent army. Little do they know that there are full of tricks behind this.

3. Excessive harassment of users

In the eyes of users, the circle of friends should be a quiet teahouse or coffee shop, where friends in the circle share their feelings, laugh, laugh and scold. However, various incompatible micro-business advertisements have broken the existing environment and are really hard to please.

The difference between social e-commerce and traditional e-commerce

1. Different ways to acquire customers

Traditional e-commerce is based on traffic, relying on traffic to drive more sales;

Social e-commerce is based on social sharing. WeChat business is a typical example of social e-commerce, but WeChat business also faces many drawbacks and needs further transformation and upgrading.

2. Different customer groups

If we analyze the customer base from the perspective of points, lines and surfaces, traditional e-commerce is point-oriented. It targets the general public and does mass business. Customers are unstable and may choose other merchants at any time.

Social e-commerce is peer-to-peer. It is just doing business with a group of people through social networking. You build relationships with customers and the customers are your own.

3. Different product structures

Traditional e-commerce companies sell popular products with high cost-performance ratio. Due to a certain lag, they sell whatever is popular when it is popular, engage in price wars, and then attract customers through cost-performance ratio.

Social e-commerce is just the opposite. It operates a combination of multiple high-quality products, which means the price may be higher. It is not a single product but a combination of products of this type.

References

• 1. Analysis of four typical social e-commerce models: Startup Network [cited on 2018-12-04]