Feishuo Shennuo advises the seller on the new crown epidemic situation.
Editor’s note: This article comes from the WeChat public account “Feishu Shennuo Group” (ID: sino_group) , author: flying book deep Snow.
In April, the global epidemic prevention situation is still grim. The epidemic situation in the hardest hit areas such as Italy, Spain, and the United States has not yet reached the inflection point, and isolation measures, border inspection and control continue to upgrade. At the same time, China is also under great pressure. Under the principle of “preventing internal relapses and importing external defenses”, the Civil Aviation Administration of China has significantly reduced the volume of international passenger flights.
Affected by this, cross-border e-commerce operations face new pain points: 1) International logistics, especially the belly cabin logistics of passenger aircraft, declines in capacity and costs increase; 2) Customs clearance becomes more difficult, and the operational risk of cargo seizure and inspection increases; 3) Overseas consumers are segregated at home, and the demand for some categories is declining. In the long run, even the overall demand will decline.
Information provided by domestic and foreign experts shows that the prevention and control of the global new crown epidemic will become a “protracted war”. This means that the short-term strategy of cross-border e-commerce sellers must be adjusted accordingly to cope with the long-term persistent difficulties.
Feishu Shennuo survey found that in the process of coping, the brand and the sellers of the station group showed their own differentiated play styles. So, what is the difference between the strategies of the two types of sellers and what are the implications? What about the direction of future strategic adjustments? We will review and analyze them one by one.
First, The spread of the epidemic, prevention and control upgrade
As of 11:00 on April 7th, a total of 1,264,114 cases have been diagnosed worldwide except China. The overseas epidemic situation has not been effectively controlled so far, and the situation is extremely grim. In the European region where the epidemic is most severe, the European Union has closed its borders for 30 days, and many countries have “closed the country”; the United States has become the “new epicenter” of the epidemic after Europe. Affected by this, the European and American economies will be hit. Goldman Sachs expects the US economy to decline by about 34% in the second quarter.
In the future, there is still great uncertainty about the new overseas epidemic situation. American epidemic expert Fuch said that the new crown epidemic may have a seasonal cycle, and the United States may have a second round of outbreaks. In response to this, cross-border e-commerce companies need to formulate comprehensive strategies to deal with the global economic recession caused by the epidemic, the decline in consumer income, and the reduction of consumer desire.
Global confirmed epidemic map (Source: WHO)
Second, brands & station groups, each with its own merits
We will analyze the performance of brand sellers and station group sellers during the epidemic from the dimensions of consumer attention, financial strength, sustainability, flexibility, and business risk. Before this, we first distinguish between brand sellers and station group sellers according to the following criteria.
Brand sellers: The marketing goal is to combine brand communication and product sales, and the way of operation is mainly brand independent stations.
Site group sellers: The marketing goal is to take product sales as the core guidance, and the operation mode is mainly based on the station group mode.
Considering the particularity of the industry, the customer names involved in the analysis below are all referred to by proxy.
1, brand sellers
1) Excellent performance
▍Stable attention: Brand sellers create a recognizable brand image through distinctive symbols, distinctive products and services, and marketing activities for the purpose of brand promotion, so as to obtain higher visibility and further form Brand trust and loyalty. During the epidemic, some consumers’ concerns about Chinese products increased, but the search interest of well-known cross-border brand websites maintained a relatively stable trend throughout Q1 2020, and Feishuo Shennuo’s data also showed advertisements of brand sellers The click rate is stable, which means that overseas consumers are paying more attention as always. Among them, brand trust and loyalty play an important role.
crossGlobal e-commerce brand website’s global search popularity remained stable
Note: Brand A is an independent clothing brand under a comprehensive cross-border e-commerce platform in Shenzhen; Brand B is a well-known Shanghai clothing brand
(Data source: Google Trends)
▍A solid fund base: Brand operations require strong and stable financial strength to support them. In turn, brand premiums can also give sellers greater profitability, so brand sellers are generally more resistant to risk from a cash flow perspective. For example, the monetary capital of the parent company of a well-known brand seller in China has been maintained at more than 1 billion yuan for a long time.
The parent company of well-known brand sellers has strong currency funds strength (Data source: company announcement)
▍Excellent sustainability: Brand value takes time to accumulate, so brand sellers pay great attention to sustainable operation capabilities. In turn, the accumulated brand equity itself is also conducive to improving the sustainability of sellers. We have observed that under the influence of the global epidemic, many well-known overseas apparel brands continue to be updated.
A certain overseas clothing brand put on new summer clothes and swimwear, more than 150 new items on the day
(Source: Brand’s official website)
2) Adverse performance
▍Flexibility is weak: Brand customers need to dig deeper into a certain area. They are more cautious about changing or expanding categories, and it is difficult to adjust at any time according to demand fluctuations. With the upgrading of overseas isolation measures, consumer demand structure has changed, such as the demand for outdoor sports and beauty products (see
CTR advertising for cross-border brand sellers is stable, and CVR is down (data source: Feishu Shennuo)
3) Strategy suggestions
▍Operating urgently needed categories: According to observations, with the spread of the epidemic and the prolongation of consumers ’home time, the overseas demand for entertainment games, home kitchen supplies, home office supplies, and indoor fitness products is expected to usher in growth. Brand sellers can try to manage the products in the above categories that are similar to their own brand attributes, because they can meet the current needs of consumers, which can improve short-term benefits and increase brand awareness.
After the isolation prevention and control measures are upgraded, the search interest for Joystick and KidsToys increases significantly
(Data comesSource: Google Trends)
▍Improve the brand image and accumulate future recovery: brand building is a dynamic and continuous process, but traditional brand promotion methods may be dragged down by the epidemic and the effect will be greatly reduced. We recommend that brand sellers support anti-epidemic work by carrying out public welfare activities, which can not only enhance brand exposure, but also shoulder social responsibilities to enhance the brand image, thereby winning the favor of potential consumers.
The survey shows that social responsibility has become one of the important factors influencing consumers ’purchasing decisions. The successful experience of overseas e-commerce brand Conscious Step confirms this point. The brand said that it will donate part of each order for public welfare and actively support the epidemic prevention work of the new crown virus.
Conscious Step, an environmentally friendly socks e-commerce brand, donated to the New Crown Outbreak Relief Fund
(Source: Conscious Step)
2. Station group sellers
1) Excellent performance
▍Flexibility highlights: In the face of the epidemic, the sellers of the station group have a corresponding team operation for different categories, and can use this as a basis for rapid adjustment. Obtain a large amount of income within. Feishuo Shennuo research found that during the outbreak of overseas outbreaks, after a brief decline in the initial conversion rate of station sellers, as it began to sell products such as anti-epidemic, home, and game peripherals, the conversion rate gradually stabilized, and before the outbreak Compared with the basic stability (the conversion rate of brand sellers in the same period decreased by about 33.4% compared with that before the epidemic), the advantages of flexibility of station sellers are prominent.
CTRs of cross-border station sellers advertise CTR upwards, and CVR is stable (Data source: Feishu Shennuo)
2) Adverse performance
▍High compliance risk: Research shows that during the epidemic period, some station group sellers pre-sell in advance without inventory, resulting in poor delivery experience later.Household complaints increased. In addition, overseas mainstream media platforms do not recognize the operation methods of station group customers, which greatly increases the possibility of large-scale closure, further reducing the customer experience, which leads to a reduction in reputation.
At the same time, due to their flexibility, customers of the station group have turned to explosive products during the epidemic, but the delivery strategy is too aggressive. In order to prevent the inflow of undesirable products, various media platforms have introduced restrictions on advertising. .
▍Sustainability is weak: Due to their business model, sellers of station groups need to continue to discover explosive products. Once the product selection is wrong, if they fail to grasp the changes in consumer demand, it will result in loss of funds. At the same time, most site group sellers have a single site lasting only a few months, and it is difficult to cultivate long-term loyalty of consumers, forming an effective repurchase, and the sustainability is weak.
3) Strategy suggestions
▍Be vigilant to business risks: During the epidemic, sellers of the station group have aimed at the business opportunities brought by the huge gap in overseas epidemic prevention supplies, but operating epidemic prevention supplies is not easy.
On the one hand, domestic regulations are tightening, and the Ministry of Commerce and other departments have recently issued double certifications for the export of medical materials such as masks, and the difficulty of obtaining sales qualifications has greatly increased. On the other hand, some countries (such as Germany) detained anti-epidemic products through customs, and the products did not meet the national standards of the destination, etc., which will lead to the rejection and return of goods. .
Strict export management of medical supplies (Source: Ministry of Commerce)
▍Shaping brand image: In recent years, emerging e-commerce platforms have increasingly focused on brand building. For example, Allbirds, Gymshark, GearBunch, etc. have clearly defined their brand image at the beginning of their establishment, attracting target user groups and forming sustainable development of. Station group sellers can first build independent brands in their own areas, which is conducive to improving their popularity, increasing brand premiums, and increasing sales revenue; at the same time, they can win consumer minds, enhance user stickiness, and increase the repurchase rate.
Three, conclusion
In the face of epidemic pressure, brand cross-border sellers and station group cross-border sellers responded quickly, giving full play to their respective advantages. However, the uncertainty of overseas epidemic prevention and control is high and the duration is long, and the seller’s strategy also needs to be constantly adjusted. In the general direction, we buildIt is recommended that brand sellers learn from the characteristics of strong flexibility of station group sellers and sell urgently-needed categories that are strongly correlated with existing categories, and at the same time, promote social branding to enhance brand image; it is recommended that station group sellers learn from the characteristics of strong brand sellers and are better at In the field of building brand value in order to seek long-term development, while being vigilant against the operational risks of protective products.
The epidemic will eventually pass, and all kinds of market fluctuations will always exist. Only by building a brand moat and switching from winning consumers ’purchasing choices to winning consumers’ lasting trust can we share the abundant cross-border e-commerce without fear of the storm Development dividend. At the same time, the recent untrustworthy performance of some Chinese emerging brands in overseas capital markets has also negatively affected the globalization of Chinese brands. Brand building is a systematic project, which requires mid- and long-term planning, and also considers the solidity of the landing and the expected return, so that the value brought by the brand can be fully realized.
We will analyze the performance of brand sellers and station group sellers during the epidemic from the dimensions of consumer attention, financial strength, sustainability, flexibility, and business risk. Before this, we first distinguish between brand sellers and station group sellers according to the following criteria.
Brand sellers: The marketing goal is to combine brand communication and product sales, and the way of operation is mainly brand independent stations.
Site group sellers: The marketing goal is to take product sales as the core guidance, and the operation mode is mainly based on the station group mode.
Considering the particularity of the industry, the customer names involved in the analysis below are all referred to by proxy.
1, brand sellers
1) Excellent performance
▍Stable attention: Brand sellers create a recognizable brand image through distinctive symbols, distinctive products and services, and marketing activities for the purpose of brand promotion, so as to obtain higher visibility and further form Brand trust and loyalty. During the epidemic, some consumers’ concerns about Chinese products increased, but the search interest of well-known cross-border brand websites maintained a relatively stable trend throughout Q1 2020, and Feishuo Shennuo’s data also showed advertisements of brand sellers The click rate is stable, which means that overseas consumers are paying more attention as always. Among them, brand trust and loyalty play an important role.
crossGlobal e-commerce brand website’s global search popularity remained stable
Note: Brand A is an independent clothing brand under a comprehensive cross-border e-commerce platform in Shenzhen; Brand B is a well-known Shanghai clothing brand
(Data source: Google Trends)
▍A solid fund base: Brand operations require strong and stable financial strength to support them. In turn, brand premiums can also give sellers greater profitability, so brand sellers are generally more resistant to risk from a cash flow perspective. For example, the monetary capital of the parent company of a well-known brand seller in China has been maintained at more than 1 billion yuan for a long time.
The parent company of well-known brand sellers has strong currency funds strength (Data source: company announcement)
▍Excellent sustainability: Brand value takes time to accumulate, so brand sellers pay great attention to sustainable operation capabilities. In turn, the accumulated brand equity itself is also conducive to improving the sustainability of sellers. We have observed that under the influence of the global epidemic, many well-known overseas apparel brands continue to be updated.
A certain overseas clothing brand put on new summer clothes and swimwear, more than 150 new items on the day
(Source: Brand’s official website)
2) Adverse performance
▍Flexibility is weak: Brand customers need to dig deeper into a certain area. They are more cautious about changing or expanding categories, and it is difficult to adjust at any time according to demand fluctuations. With the upgrading of overseas isolation measures, consumer demand structure has changed, such as the demand for outdoor sports and beauty products (see
CTR advertising for cross-border brand sellers is stable, and CVR is down (data source: Feishu Shennuo)
3) Strategy suggestions
▍Operating urgently needed categories: According to observations, with the spread of the epidemic and the prolongation of consumers ’home time, the overseas demand for entertainment games, home kitchen supplies, home office supplies, and indoor fitness products is expected to usher in growth. Brand sellers can try to manage the products in the above categories that are similar to their own brand attributes, because they can meet the current needs of consumers, which can improve short-term benefits and increase brand awareness.
After the isolation prevention and control measures are upgraded, the search interest for Joystick and KidsToys increases significantly
(Data comesSource: Google Trends)
▍Improve the brand image and accumulate future recovery: brand building is a dynamic and continuous process, but traditional brand promotion methods may be dragged down by the epidemic and the effect will be greatly reduced. We recommend that brand sellers support anti-epidemic work by carrying out public welfare activities, which can not only enhance brand exposure, but also shoulder social responsibilities to enhance the brand image, thereby winning the favor of potential consumers.
The survey shows that social responsibility has become one of the important factors influencing consumers ’purchasing decisions. The successful experience of overseas e-commerce brand Conscious Step confirms this point. The brand said that it will donate part of each order for public welfare and actively support the epidemic prevention work of the new crown virus.
Conscious Step, an environmentally friendly socks e-commerce brand, donated to the New Crown Outbreak Relief Fund
(Source: Conscious Step)
2. Station group sellers
1) Excellent performance
▍Flexibility highlights: In the face of the epidemic, the sellers of the station group have a corresponding team operation for different categories, and can use this as a basis for rapid adjustment. Obtain a large amount of income within. Feishuo Shennuo research found that during the outbreak of overseas outbreaks, after a brief decline in the initial conversion rate of station sellers, as it began to sell products such as anti-epidemic, home, and game peripherals, the conversion rate gradually stabilized, and before the outbreak Compared with the basic stability (the conversion rate of brand sellers in the same period decreased by about 33.4% compared with that before the epidemic), the advantages of flexibility of station sellers are prominent.
CTRs of cross-border station sellers advertise CTR upwards, and CVR is stable (Data source: Feishu Shennuo)
2) Adverse performance
▍High compliance risk: Research shows that during the epidemic period, some station group sellers pre-sell in advance without inventory, resulting in poor delivery experience later.Household complaints increased. In addition, overseas mainstream media platforms do not recognize the operation methods of station group customers, which greatly increases the possibility of large-scale closure, further reducing the customer experience, which leads to a reduction in reputation.
At the same time, due to their flexibility, customers of the station group have turned to explosive products during the epidemic, but the delivery strategy is too aggressive. In order to prevent the inflow of undesirable products, various media platforms have introduced restrictions on advertising. .
▍Sustainability is weak: Due to their business model, sellers of station groups need to continue to discover explosive products. Once the product selection is wrong, if they fail to grasp the changes in consumer demand, it will result in loss of funds. At the same time, most site group sellers have a single site lasting only a few months, and it is difficult to cultivate long-term loyalty of consumers, forming an effective repurchase, and the sustainability is weak.
3) Strategy suggestions
▍Be vigilant to business risks: During the epidemic, sellers of the station group have aimed at the business opportunities brought by the huge gap in overseas epidemic prevention supplies, but operating epidemic prevention supplies is not easy.
On the one hand, domestic regulations are tightening, and the Ministry of Commerce and other departments have recently issued double certifications for the export of medical materials such as masks, and the difficulty of obtaining sales qualifications has greatly increased. On the other hand, some countries (such as Germany) detained anti-epidemic products through customs, and the products did not meet the national standards of the destination, etc., which will lead to the rejection and return of goods. .
Strict export management of medical supplies (Source: Ministry of Commerce)
▍Shaping brand image: In recent years, emerging e-commerce platforms have increasingly focused on brand building. For example, Allbirds, Gymshark, GearBunch, etc. have clearly defined their brand image at the beginning of their establishment, attracting target user groups and forming sustainable development of. Station group sellers can first build independent brands in their own areas, which is conducive to improving their popularity, increasing brand premiums, and increasing sales revenue; at the same time, they can win consumer minds, enhance user stickiness, and increase the repurchase rate.
Three, conclusion
In the face of epidemic pressure, brand cross-border sellers and station group cross-border sellers responded quickly, giving full play to their respective advantages. However, the uncertainty of overseas epidemic prevention and control is high and the duration is long, and the seller’s strategy also needs to be constantly adjusted. In the general direction, we buildIt is recommended that brand sellers learn from the characteristics of strong flexibility of station group sellers and sell urgently-needed categories that are strongly correlated with existing categories, and at the same time, promote social branding to enhance brand image; it is recommended that station group sellers learn from the characteristics of strong brand sellers and are better at In the field of building brand value in order to seek long-term development, while being vigilant against the operational risks of protective products.
The epidemic will eventually pass, and all kinds of market fluctuations will always exist. Only by building a brand moat and switching from winning consumers ’purchasing choices to winning consumers’ lasting trust can we share the abundant cross-border e-commerce without fear of the storm Development dividend. At the same time, the recent untrustworthy performance of some Chinese emerging brands in overseas capital markets has also negatively affected the globalization of Chinese brands. Brand building is a systematic project, which requires mid- and long-term planning, and also considers the solidity of the landing and the expected return, so that the value brought by the brand can be fully realized.