The low price, service and quality of the volume have made many businesses suffer from the "inner volume" of various e-commerce platforms since this year, and the "wool party", which was born only from refunds, has become the target of many businesses' roast. Breaking the 'roll' is the theme of our era, and I believe that low-quality internal competition is a mutually harmful and price driven dead end. How to make the cake bigger? The answer lies in technology and innovation, "said Ma Shuzhong, Dean of the China Digital Trade Research Institute at Zhejiang University, at the 1688 Anti Internal Competition Conference on August 12th.
Ma Shuzhong shared the trend of AI accelerating the development of digital supply chains, saying, "In the era of rapid development of artificial intelligence, businesses need to learn to use AI technology to solve problems. They cannot use their original sales, marketing, operation, product, or business expansion problems anymore
On August 12th, at a critical point in the second half of the year, 1688 introduced a series of "anti internal competition" measures, launched a "efficiency improvement and income increase" plan for source manufacturers in the industrial belt, and released a free "AI management assistant".
The second generation of the factory is taking over and transforming, attracting overseas customers
He Yudi, a representative of post-2000 1688 merchants, the "second generation of factories," and the general manager of Dongyang Shangdao Fishing Gear Co., Ltd., shared that on a platform with a large number of "refund only" users, last month's refund rate reached 1.2%, with a return and refund rate of over 10%; After taking over his parents' business on 1688, He Yudi found that B-end customers would not exhibit such behavior. At the end of last year, He Yudi took over the 1688 store of his own factory, and the overall sales have increased by 120% so far.
At the same time, He Yudi also hopes to explore overseas online sales channels. "We have signed cooperation agreements with the largest fishing gear companies in South Korea and Malaysia respectively. In the future, we also hope to expand our online business in foreign trade through platforms such as Alibaba International Station. Currently, our foreign trade is mainly offline
Regarding the adjustment of foreign trade, He Yudi mentioned that the biggest concern at present is the inability to settle payments in real time, so he hopes to receive quick payments through 1688. "For our fishing gear customers, they do not like normal bank transfers, and some even use third-party transfers. Therefore, we plan to attract more customers to the 1688 platform, including the international station platform, so that our merchants' interests can be protected by the platform and payments can be received quickly
Dong Fanming, the general manager of Shanghai Xinmai Food Industry Co., Ltd., who also took over his own business, positions his company as the "source factory of the world's top luxury brands". His company specializes in pastry products and mooncakes, and has customized gift boxes and souvenirs for many luxury brands.
Dong Fanming revealed that he tried many e-commerce platforms and finally found that 1688 is more suitable for his own factory. In the first half of this year, it achieved a year-on-year growth of 80% -100%. "Big customers who placed orders for customization last year still have repeat purchases this year. Among the top 20 customers, 100% repeat purchases. Therefore, the users we found on the 1688 platform are very in line with our market positioning. Moreover, our prices are not low, and we can say that the prices are the highest among 1688 mooncake merchants, but we can still find buyers who meet our positioning
In addition, Dong Fanming also mentioned that he can receive orders for new brands and foreign brands on 1688. "Customers such as Makenini, Peninsula Hotel, Rosewood Hotel, Hilton, Coco Full Score, etc. all found us through this platform. In addition to these foreign brands, there are also emerging team leaders and new sales channels who have found us on 1688
In the increasingly fierce competition, Dong Fanming has also introduced AI packaging design, AI quality inspection, and so on. "Our recent French caramel croissant egg tart was not satisfied with the first version of the packaging, but later we used AI to come up with a packaging product that meets the requirements within 30 minutes. This year, we also used AI to make mooncake gift boxes
Build a digital supply chain and break free from the internal competition mode
The specific efficiency improvement measures of 1688 are that merchants simplify their business on the platform into two models. One is the self operated model, where the platform provides AI business assistants with the ability to operate on behalf of others, as well as specific sales channels for "assisting sales"; The second is the supply mode, which is equivalent to the custody mode. The platform invites bids from merchants, who join the supply mode through popular bidding and provide the product supply price. The platform provides pricing advice, assists merchants in sales, and fulfills contracts.
It is reported that AI business assistants are equivalent to equipping merchants with a team of digital employees, including AI store managers, AI material operations, AI marketing and promotion, and AI customer management. 1688 has decided that all existing AI products aimed at merchants will be free, and all future AI products launched by 1688 for merchants will also be free.
During the gray level testing period of the AI business assistant, merchants who used the product had a business difficulty equivalent to 60% of the original, and the average business opportunity increased by 50%. Through the free AI operation capability provided by the platform, businesses can now complete tasks that previously required a professional operator, with only 0.2 labor costs.
Despite the increasing influx of young C-end consumers in recent years, the person in charge of 1688 revealed that it is still a pure blooded B-class platform. "Although the influx of young people has brought more C-class traffic to the platform, more than 90% of the platform's transaction volume is B-class behavior
The relevant person in charge of 1688 said that 1688 would not transform into an e-commerce platform that is both to B and to C, but would like to become a digital supply chain platform. "How do you understand this digital supply chain? Our internal image describes it as a digital chip, which integrates the products of today's Chinese source factories, and plug and play after integration. Where there is traffic and profit, put this chip. Today, I will store the products of the source factory in Tiktok. There is traffic on Amazon, and I will store the products of this source factory in Tiktok. There is traffic on Amazon, and I will store the products of this source factory in Amazon. There is traffic on Lazada, we will store them in Lazada, which is the first step. The second step is to go further up, to production and manufacturing. If we go further up, we will reach raw materials. Therefore, the next step from the supply chain to today's industrial Internet is what 1688 hopes to achieve, rather than falling into the mode of price volume and internal volume of each e-commerce platform. This is what we want to do today and in the future
It is reported that in November 2023, Alibaba Group announced the first batch of strategic level innovative businesses -1688, Xianyu, DingTalk, and Quark. Alibaba Group stated that 1688 is Alibaba's oldest business, serving mainstream manufacturers in China's manufacturing industry, with a solid foundation and huge potential for secondary entrepreneurship. It is expected to expand from B2B business to small and medium-sized enterprises and consumer procurement, while also having the ability to support cross-border transactions.