2023.11.25 11:32
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Taobao is unbeatable again 12

Author | Liu Baodan The sluggish consumer demand combined with the intense market competition has led to the gradual decline of Taobao's Double 12 event in recent years. Recently, Huasheng.com noticed that when asked about the timing of the Double 12 event, Taobao replied that the event has been cancelled this year and will no longer be held. Instead, it will be replaced by the "Taobao Good Price Festival".

The sluggish consumer demand and intense market competition have led to the end of Taobao's Double 12 event, which has been gradually declining in recent years.

Recently, Wall Street News noticed that Taobao responded to questions about the timing of the Double 12 event by stating that it has been canceled this year and will no longer be held.

Instead, it will be replaced by the "Taobao Good Price Festival". Insiders close to Taobao said that the year-end Good Price Festival is a continuation and enhancement of the Good Price Festival, focusing on offering high-quality products at affordable prices to consumers.

This also means that the focus of Taobao's year-end promotion has shifted from inventory clearance to low prices, and the Double 12 event, which has been a part of the e-commerce industry for 11 years, will also exit the stage of history.

Taobao's shift is not surprising. On the one hand, the Double 12 event has long been showing signs of fatigue. On the other hand, low prices have become the core of competition in the current e-commerce market and have become increasingly commonplace.

As early as 2012, when the Double 12 event was first launched, it existed as an extension and supplement to the Double 11 event. At that time, the focus of Taobao's Double 11 event shifted to the newly established Tmall. In order to accommodate more C-end merchants and handle the large amount of inventory left from the promotion, Taobao introduced the Double 12 event. Later, other platforms also started to follow suit, but the volume and influence of the Double 12 event have never been comparable to the Double 11 event.

In recent years, there have been constant arguments about the declining popularity of the Double 12 event, especially as consumers have become more rational in their shopping behavior, causing the Double 12 event to become increasingly quiet.

Zhuang Shuai, a retail e-commerce industry expert and founder of Bailian Consulting, believes that the existence of the Double 12 event depends on the platform, consumers, and merchants. If the driving force for consumer spending is not strong enough, the event naturally loses its value.

In addition, intense market competition has also forced e-commerce promotions to become more commonplace, as only in this way can more market share be leveraged.

In particular, the emergence of Pinduoduo, with its shaping of the low-price mindset, has successfully listed on NASDAQ in its fourth year of establishment and quickly become a leading e-commerce platform, completely rewriting the long-standing e-commerce landscape dominated by Alibaba and JD.com.

Pinduoduo's billions of subsidies have achieved everyday low prices. Compared to the marketing events of e-commerce platforms such as 618, Double 11, and Double 12, Pinduoduo has to a large extent reshaped people's consumption habits and triggered imitation by other platforms.

In the just-concluded Double 11 event, JD.com, Hai Shi, and Li Jiaqi's war of words dominated the hot search rankings, and the battle for the lowest price in the e-commerce industry was brought to the forefront. Douyin, Kuaishou, and Xiaohongshu also want to get a share of the market, making it increasingly crowded.

When all platforms and influencers are shouting for the lowest price, the key lies in the continuous and sustained price competition in daily life.

This also means that traditional marketing activities in e-commerce are losing their appeal. According to data from Xingtu, the cumulative sales of comprehensive e-commerce platforms and live-streaming e-commerce platforms during this year's Double 11 event amounted to 1.1386 trillion yuan, an increase of only 2.08% compared to the previous year.

Faced with a rapidly changing market environment, Taobao, once the king of e-commerce, must also make changes. At the end of May this year, Jack Ma pointed out the direction for Taobao's development, which is to return to Taobao, return to users, and return to the Internet. Returning to the essence of Taobao represents a return to low prices. Correspondingly, Taobao has made price competitiveness one of its five major strategies for the year, focusing on improving the cost-effectiveness of its products.

The "Good Price Festival" is the implementation of this strategic direction. During this year's 618 shopping festival, Taobao launched the "Good Price Festival" for the first time, allowing small and medium-sized businesses to take center stage in major promotions.

On August 10th, the CEO of Taobao, Dai Shan, stated during a Q1 earnings conference call that the "Good Price Festival" attracted more visits and purchases from the lower-tier market and young users by focusing on cost-effectiveness and matching supply with demand.

During the Double 11 shopping festival, the "Good Price Festival" performed steadily. According to data released by Taobao, as of midnight on November 11th, over 2.2 million small and medium-sized businesses achieved double the sales compared to last year. Dai Shan stated that during the Tmall Double 11 period, the price competitiveness was evident, with users from third-tier cities and below placing 140 million more orders than last year.

For the upcoming "Good Price Festival," Taobao's promotional efforts remain strong.

According to insiders at Taobao, the "Good Price Festival" will officially begin at 8 pm on December 9th. Compared to previous Double 12 events, the discounts, merchant scale, and product scale will all see significant increases.

Taobao's continuous emphasis on low prices is not only a response to changing market conditions but also a strategy to maintain its market position. This is destined to be an unprecedented e-commerce battle, and Taobao's counterattack has only just begun.

Fifteen years ago, Zhang Yong, who was then the CFO of Taobao and also the CEO of Tmall, "invented" the Double 11 and Double 12 shopping festivals. With rapid economic growth, it sparked a decade-long consumer upgrade frenzy. People believed that they could get promotions and salary increases in the future, and the extravagant shopping of the present could be absorbed by income growth. It was a time of enthusiasm and confidence.

However, in recent years, with the global economic slowdown, high cost-effectiveness has become the consumption concept of almost everyone. Business models like Tmall and JD.com, which focus on consumer upgrades, have been met with indifference, while platforms like Pinduoduo and Douyin e-commerce have risen. The decline and gradual withdrawal of the Double 11 and Double 12 events are not surprising.

A new era has arrived.