Aihuihui is facing a new offline war and traffic anxiety.
Some new changes are faintly brewing in the second-hand e-commerce industry.
Recently, Xianyu has upgraded its brand strategy and launched three major businesses: “Worry-Free Shopping”, “Playing Community” and “New Offline”. Prior to this, the second-hand 3C player in the vertical field Aihuihui announced that it would replace “aihuihui” with “new life” as a new group brand.
From the brand upgrade to the specific business area layout, Xianyu seems to be more and more engaged in the second-hand 3C part and love recycling. From the perspective of Xianyu’s new offline strategy, the essence is that after Xianyu has sufficient online traffic, it attempts to improve its offline ecology and uses Xianyu Station to cut into the hinterland of Aihui.
Earlier, the second-hand 3C field of second-hand mobile phones ranked the top two Zhuanzhuan and the merger of looking for a beautiful machine, directly fixed the pattern of the second-hand 3C field. It seems that Aihuihui is facing a new offline war and traffic anxiety.
Under the heavy warehouse line, it is difficult to hide the hidden worries of lack of traffic and insufficient C-end users
In the field of second-hand e-commerce, the mainstream players are Xianyu, Zhuanzhuan, and the vertical fields include looking for beautiful machines, love recycling, and recycling treasure. But after 2019, the trend of duopoly has become more obvious. According to the “2019 China Second-hand E-commerce Development Report”, Xianyu’s penetration share accounted for 70.7%, and the transfer accounted for 20.2%. The combined user share of the two reached more than 90%, leaving the cake for other players. Not much.
Different from Zhuanzhuan and Xianyu, which are comprehensive second-hand e-commerce players with huge online traffic advantages, Aihuihui, which started with a mobile phone recycling business, focuses on offline stores. Since 2013, Ai Recycling has been deploying offline. Ai Recycling claims to have more than 700 stores across the country, but it has never formed an independent and powerful traffic portal. In other words: there is no real user of its own.
Since this year, due to the epidemic and other factors, the shortcomings of Aihuihui’s “light online, heavy offline” asset-heavy model have been exposed, and its performance in the vertical field of second-hand mobile phones has been poor. Bida’s data shows that in March of this year, among the monthly active users of second-hand e-commerce apps, Xianyu and Zhuanzhuan were 82.34 million and 20.93 million respectively, while Aihuihui was only 256,000, which was not as good as Xianyu and Zhuanzhuan. Fraction.
Although the second-hand e-commerce platform has been developing rapidly this year, it is still difficult to recover from the impact of the epidemic. On the one hand, Ai Huihui’s recycling business mainly relies on offline. This year’s offline was affected by the epidemic and damagedThe loss is very large. In addition to the shortage of funds, offline stores have become a source and burden of cash flow pressure. To this end, Aihuihui also held an internal mobilization meeting of “Gather hard work and persevere against the wind” at that time, stating that as an Internet company “strongly attached to the offline retail industry, everyone must be prepared to live a hard life.”
On the other hand, the situation of lack of recycling traffic is getting harder. In fact, a single-category, offline vertical e-commerce platform is naturally difficult to compete with comprehensive e-commerce platforms in terms of traffic acquisition, and Aihuihui is difficult to match Xianyu and Zhuanzhuan in terms of traffic acquisition. Prior to this, Ai Recycling merged with “PaiPai”, a second-hand trading platform under JD.com, to integrate online and offline scenes and traffic, with the goal of integrating PaiPai to obtain traffic access. In September of this year, Ai Recycling received a new round of financing led by JD.com, expressing that it relies on Ai Recycling’s store network and delivery capabilities to establish in-depth omni-channel cooperation with JD.com.
Whether it is getting financing from JD or acquiring an auction, it is actually an attempt by Aihuihui to transform to a traffic-driven model. However, from the data point of view, the integration effect of Aihuihui and Paipai is not good. When the two merged in June last year, Aihuihui still had 150,000 independent devices, but only 80,000 units remained in August this year. . This aspect is due to the different attributes of the two platforms. Paipai is a comprehensive B2C, and Aihuihui is C2B. After the integration, Paipai is more of an online sales channel, and it is difficult for users and traffic on both sides to produce synergy. In addition, it is difficult to fully undertake and integrate new traffic-based businesses with Aihui’s relatively single model.
In the past, Aihuishou has always relied on JD.com to obtain online traffic. However, judging from the current competitive trend in the e-commerce market, JD.com itself is also short of traffic. The cost of acquiring online traffic is getting higher and higher. JD’s support is limited. At the same time, some other partners, including OPPO, vivo, etc., no longer only use love recycling. Ai Huihui can no longer shake the Xianyu and turn around as the head position of the first echelon in the market.
On the whole, compared with Xianyu and Zhuanzhuan, Aihuihui has not established its own user base on the C-side. In the mainstream list of second-hand e-commerce, it is basically difficult to see the APP under Aihuihui. Relying on external blood transfusions led to a single offline model under the cloak of the Internet.
The supply chain has always been the focus and emphasis of Ai Recycling. However, we have seen from the complaints of black cats that there are many related complaints about Aihui recycling platform’s “price reduction for various reasons” and “unreasonable quality inspection prices”.
It can be known that under the C2B model of the supply chain system established by Aihuihui, the platform needs to achieve profit through intermediate links, which cannot well meet the consumer needs and interest demands of the C-end.
The supply chain of Aihuishou is not the strongest in the industry. Aihuishou’s supply chain advantages include Xianyu and Zhuanzhuan, or even stronger. The intermediate services and supervision links of Xianyu and Zhuanzhuan, as well as infrastructure such as credit services, are not available in Aihuihui.
With the trend of online and offline integration among players in the future, new competitions will begin, and the offline impact of Aihui may become more intense.
The online and offline dual attacks of the two giants, the future of love recycling is worrying
To make matters worse, the current Zhuanzhuan and Xianyu are cutting into the love recovery hinterland.
Insisting on the transformation of the full-category layout in the past two years, we have begun to focus strategically. On the basis of retaining more than 20 categories such as digital, clothing, shoes and hats, we will focus on the 3C category of second-hand mobile phones. One of the big moves this year is to merge with the strategy of finding a beautiful machine, and increase the second-hand mobile phone track.
For Zhuanzhuan, the merger to find a good opportunity can further integrate the flow and supply chain advantages of both parties. At the same time, it is a huge blow to the love recycling of the same category. In fact, at the home court of second-hand mobile phones, Aihuihui has already encountered tremendous pressure brought by the continuous increase in the number of second-hand mobile phones. According to Aurora Big Data’s “Q2 Mobile Internet Industry Data Research Report in 2020”, among the average DAU of second-hand mobile phone trading apps in June 2020, Zhuan Zhuan ranked first with 2.010 million, and the second is with 831,000 search The third is the Coke Youpin Mall with 59,000 yuan, and the fourth is Aihuihui, with only 17,000.
The brand upgrade of Xianyu has launched three major businesses: Worry-Free Shopping, Huiwan Community, and New Offline. Xianyu and Aihui’s “Zhuangshan” is obvious. The worry-free shopping launched by Xianyu is aimed atThe four major areas include luxury goods and mobile phone digital, which are the categories emphasized by Ai Recycling and Shooting over the past year. In addition, the creation of a service system that provides recycling and identification services by service providers is also the pain point of love recycling. In addition, in the upgrading of Xianyu’s brand strategy, “new offline” is Xianyu’s offline store opening business. Xianyu said that in the next three years, Xianyu bases will be established in 20 cities across the country, and Xianyu Station will be deployed in more than 50 cities, and Xianyu Market will also be extended to 30 cities.
In the second-hand e-commerce industry, offline is a business card for recycling. But the business card of offline stores essentially has no thresholds and barriers. Online, Xianyu already has 300 million users. Relying on the credit system that has been established online in the Ali ecosystem, the offline scenario is where Xianyu needs to cultivate new growth space. The layout of Xianyu base and Xianyu station , Will launch a battle for store layout offline with Ai Recycling, and the strategic purpose behind it is to obtain offline traffic.
In the past, Huihuibao had a direct competition with Aihuihui, and now it has obtained Xianyu’s strategic investment. With the follow-up and combination of Xianyu Station and Xianyu Base, Aihuihui’s offline channels and traffic may be Will face a greater impact.
Therefore, with the two giants of Xianyu and Zhuanzhuan cutting into their core hinterland online and offline, the entire industry may have a harvesting battle next year, and the situation facing Aihuihui will become more difficult.
Love Recycling’s Defensive Anxiety: How to Relieve the Traffic Dilemma
Since 2013, Ai Recycling has been in the offline layout, but the 7-year rapid offline expansion of Ai Recycling has not helped build deeper moats and industry barriers. On the contrary, the larger the scale, the pressure on the capital chain and operating costs brought by it. Also getting bigger.
The founder of Aihuihui once calculated the offline cost. Aihuihui’s one-time hardware investment for a simple store is 70,000 yuan, and the hardware investment for 700 stores is about 49 million yuan. Including the company’s employees, the monthly operating cost is about 30,000 yuan. This number is multiplied by 700 stores. The operating cost of existing stores exceeds 250 million yuan. This is still not considering the rent increase and market promotion. With continued expansion, the actual operating costs that Ai Recycling will bear are much higher than this. Earlier, according to its internal employees, in January, when the epidemic was severe, Aihuihui created its own “salary allowance” and proposed that all employees should be paid 10%-30% to reduce costs and survive the crisis.
Online, Ai Recycling relies on JD resources and highly dependent on the flow of external channels. However, many of JD’s businesses also need to reduce expenditure this year. Self-sufficiency in core business flow is the key, and it is difficult to give Ai Recycling more care. After the larger opponents entered, Aihui’s countermeasures were very scarce, and traffic anxiety continued from online to offline.
This year, the Aihuishou brand has been upgraded to “new life”, and the strategy behind it may be from recycling mobile phones to recycling “everything”, cutting into more tracks. This may be due to the poor performance of Aihuishou’s offline businessIn the current situation, try to use diversified new stories to increase the valuation of the capital market, obtain more financing or go public. In September 2020, Aihuihui has completed the US$150 million E+ round of financing jointly led by JD Group and Guotai Junan International. The participation of brokers may also prove its anxiety in the capital market.
But in the context of the tight recovery of funds, it is hard to say how long this year’s new financing can support. Whether it is currently trying to seek growth from vertical platforms to diversified expansion, or defending the duopoly in the core hinterland The operating costs brought by offline expansion and the future traffic competition with Xianyu’s offline stores will require a lot of funds. Aihuihui still needs to seek help from the capital market.
The nature of Aihuihui’s dilemma is that it reflects the vulnerability of its excessive reliance on offline channels when its online traffic shortcomings are not filled. Because second-hand e-commerce, e-commerce is the core, from supply chain system to Stable user retention and online traffic platforms are indispensable. If you don’t have your own user system and traffic pool, you actually lack a stable profit foundation in this field, and focus too much on a single offline store model and it’s difficult to establish a line. Integrated ecological moats and barriers on and off. For Ai Recycling, continuous financing may be urgently needed to break the predicament. It has never been seen whether Ai Recycling will be subject to pressure. It is still unknown whether Ai Recycling will be subject to pressure.
Now the capital market has changed. In the past few years, in the tide of mobile Internet venture capital, investors have focused on growth. Many companies that have not found a business model and continue to lose money can easily get financial support from the market if they can tell a growth story. But in today’s capital environment, actual profitability has become a more core value judgment indicator. It is not easy to take the path of Love Recycling and leveraging the capital market.
In the e-commerce industry, the case of integrated platform giants using the ecological advantages of their platform flow, capital and supply chain to defeat vertical players has been staged several times at home and abroad. This is the anxiety and hidden worries of Aihuihui. How to break In the current dilemma, Aihuihui urgently needs to find a way out, but at present, the way forward is not optimistic.