Reporter | Yang Peiwen
The "Double 12" on Taobao has been cancelled and replaced by the "Taobao Annual Good Price Festival".
Red Star Capital Bureau has found that after 11 years of development, "Double 12" has already deviated from its original intention when it was launched in 2012, gradually converging with "Double 11". On the contrary, its competitor PDD. US has truly cultivated the characteristics of SNS (Social Networking Services).
Red Star Capital Bureau reviewed the latest financial reports of Alibaba (09988. HK; BABA. US) and found that during the reporting period, the online GMV (total commodity transaction volume) of Taobao and Tmall had decreased, and among Alibaba's subsidiaries, Taotian Group ranked second to last in year-on-year revenue growth rate.
What does the "Taobao year-end good price festival" replacing "Double 12" mean?
Taobao cancels the "Double 12" shopping festival
"All e-commerce shopping festivals are homogeneous competition"
Recently, a screenshot from the Taobao merchant service hall has been circulating online. The picture shows that the Taobao "Double 12" event has been cancelled this year and will no longer be held. In December of this year, the platform will hold a large-scale event called the "Taobao Annual Good Price Festival".
Graph network
On November 24th, Taobao also responded to the Red Star Capital Bureau that the "Taobao Good Price Festival" will start at 8pm on December 9th. Compared to the previous "Double 12" activities, the discount intensity, merchant scale, and product scale have significantly increased.
In this regard, some netizens roast that from "Double 12" to "Taobao Good Price Festival", it was just a change of name, not a change of dressing
Chen Hudong, a special researcher at the Internet Economic and Social E-commerce Research Center, told the Red Star Capital Bureau that "618", "Double 11", "Double 12" or "Year end Good Price Festival" are all e-commerce shopping festivals, but almost all e-commerce shopping festivals are homogeneous competition.
Chen Hudong told Red Star Capital Bureau that from the perspective of consumers, although the concept of e-commerce shopping festival has been basically recognized, canceling a certain e-commerce shopping festival does not have a significant impact on consumers.
Red Star Capital Bureau noticed that in early 2012, Taobao Mall was officially renamed "Tmall" and its operational focus was on B2C. It was also in this year that Taobao first launched the "Double 12" shopping festival, at which time the positioning of "Double 11" and "Double 12" was completely different.
At that time, Xia Xia, who was then the Marketing Director of Taobao, stated that "Double 11" was a Tmall led event, while "Double 12" was a Taobao led event. Tmall and Taobao are different in nature, "for example, on Tmall, there are some brand merchants, flagship stores, etc., while Taobao is more grassroots, mainly small and medium-sized sellers."
It can be said that "Double 11" serves large businesses such as brand merchants and flagship stores, while "Double 12" is a shopping festival set up for relatively grassroots small and medium-sized businesses.
Summer once said that during the "Double 12" period, Taobao will completely hand over the dominance of marketing activities to sellers. In addition to product transactions, it hopes to cultivate distinct SNS characteristics through "joint marketing" between sellers.
According to Hainan Daily, during the "Double 12" shopping festival in 2012, Taobao no longer uniformly set discount rates for products. Consumers and sellers jointly decide what to buy, how much to sell, and how much to discount.
Specifically, all products of sellers participating in the "Double 12" event will be displayed to consumers on the Taobao platform, and consumers' collection, purchase, and sharing may increase the display position of the product. At the same time, the discount promises and product declarations made by the corresponding seller of the product will also be displayed in real-time to the consumers who collect the product.
"The e-commerce shopping festival needs to be upgraded"
"Good Price Festival" or emphasizing Taobao's price advantage
As time goes by, "Double 12" and "Double 11" gradually converge in terms of activity content.
Red Star Capital Bureau has found that the SNS features pursued by Taobao's "Double 12" campaign have actually appeared on Pinduoduo. In recent years, Pinduoduo has split into a mature e-commerce landscape with low prices and social attributes.
In addition, JD Group (09618. HK; JD. US) has also resumed its "low price" strategy this year.
Liu Junbin, a special researcher at the Internet Economic and Social E-commerce Research Center, told the Red Star Capital Bureau that currently, Taobao is facing "triple pressure" from the outside, including JD's low price strategy, Pinduoduo's impact, and the rapid development of live streaming e-commerce.
Chen Hudong also believes that currently, Taobao is facing various forms of competition. To some extent, Taobao's launch of the "Taobao year-end good price festival" is actually aimed at finding some breakthroughs and achieving a certain degree of breakthrough.
"The e-commerce shopping festival has also reached the stage of upgrading," Chen Hudong told the Red Star Capital Bureau.
A Weibo blogger revealed that during the "Taobao year-end good price festival", the platform will offer a discount of 30% off for orders over 200 (Taobao Tmall connection). Regarding this, Taobao's customer service told the Red Star Capital Bureau that they have not received any notification yet and need to wait for specific rules.
Red Star Capital Bureau has noticed that in past shopping festival activities, coupons on Taobao and Tmall were almost not exchanged.
Taking the recent Double 11 as an example, if you reach 300 on Tmall, you will receive 50 points off, and if you reach 200 on Taobao, you will receive 30 points off. If consumers want to purchase items from Tmall or Taobao stores, they need to make additional purchases to meet the discount conditions.
Zhuang Shuai, founder of Bailian Consulting, analyzed the Red Star Capital Bureau and stated that Taobao's year-end good price festival is clearly positioned as a major promotional activity for price discounts, which may be a step towards emphasizing Taobao's price advantage through the promotion.
Zhuang Shuai believes that the competition among e-commerce platforms regarding pricing power is far beyond "Double 11" and "Double 12", and also far beyond this year. The price war will continue for a long time, and may even last for 20-30 years.
Taobao and Tmall GMV declined in the second quarter
Wu Yongming and Dai Shan revisit "omnipotent Taobao"
In March of this year, Alibaba launched a "1+6+N" organizational transformation. Under the Alibaba Group, six major business groups have been established, and Taobao and Tmall Commercial Group (hereinafter referred to as "Taotian Group") is one of them, with Dai Shan serving as the CEO.
On November 16th, Alibaba released its financial report for the second quarter of the 2024 fiscal year (July 1st, 2023 to September 30th, 2023). The financial report shows that Alibaba's revenue during the reporting period was approximately 224.79 billion yuan, with a net profit of approximately 26.696 billion yuan.
Among them, Taotian Group contributed approximately 97.654 billion yuan in revenue during the reporting period, accounting for 43% of the total revenue. Taotian Group remains the main source of cash flow for Alibaba.
However, Red Star Capital Bureau has noticed that in terms of year-on-year growth rate, Taotian Group ranks second to last with 4%, only better than Cloud Intelligence Group. Alibaba Group also disclosed in its latest financial report that it will no longer promote the complete separation of Cloud Intelligence Group.
Screenshot taken from Alibaba's financial report
Under Taotian Group, it is further divided into Chinese retail businesses (including Taobao, Tmall, etc.) and Chinese wholesale businesses (referring to 1688, etc.).
According to the financial report, "The customer management revenue of Taobao Group China Retail Business increased by 3% year-on-year, mainly due to the increased willingness of merchants to invest in advertising, partially offset by a slight decrease in online GMV (total transaction volume) of Taobao and Tmall."
That is to say, in the second quarter of fiscal year 2024, the total amount of online commodity transactions on Taobao and Tmall has decreased.
According to the Shanghai Securities News, at Alibaba's recent financial report meeting, CEO Wu Yongming and Dai Shan both reiterated the "omnipotent Taobao".
"Taobao is a super app that covers three mainstream sales models: live content driven model, brand marketing model, and daily low price model." Wu Yongming said that the Taobao app has the ability to accommodate multiple product layers from branded products to white label products, as well as corresponding multiple value propositions.
Dai Shan also clearly stated that under the guidance of "user first", Taotian Group will persistently invest and upgrade to create a more interesting and cost-effective "universal Taobao".
Next, the "Taobao year-end good price festival" may become a battlefield for Taobao to once again showcase its "omnipotence".
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