The traffic trap of Douyin e-commerce under the myth of GMV growth

Original @新熵 Author 丨 Yan Zhao Editor 丨 Jue Ying

With Double 11 approaching, major e-commerce platforms are about to face a major test, and Douyin E-commerce, which has been "secretly competing," has taken the lead.

Although live-streaming e-commerce has passed its peak period, Douyin E-commerce is still thriving, with its GMV continuously climbing. The first three days of the "Douyin Mall Double 11 Shopping Festival" saw nearly 8,000 brands achieve a year-on-year sales growth of over 200%.

However, despite taking the lead and appearing prosperous, Douyin E-commerce is inevitably facing a tough battle from within and without.

After all, over the past two months, the platform's traffic has been severely affected by the consecutive scandals involving top influencers it once "relied on." Meanwhile, some brands that joined Douyin are gradually trapped in multiple dilemmas due to high marketing costs and cutthroat price competition, resulting in meager profits.

Therefore, Douyin E-commerce faces numerous challenges in balancing the interests of the platform, merchants, and users, and the Double 11 promotion will be another major test.

A Strong Start for Double 11, but Concerns Linger

In recent years, Douyin E-commerce has grown at an astonishing pace. According to LatePost, Douyin E-commerce's GMV (Gross Merchandise Volume) exceeded 500 billion yuan in 2020, more than tripling from 2019.

Four years later, Douyin E-commerce's sales scale has quintupled, with GMV reaching 2.6 trillion yuan, and it is expected to exceed 3 trillion yuan in 2024.

This growth rate even surpasses that of e-commerce veterans like Pinduoduo, Taobao, and JD.com. For example, it took Pinduoduo a full six years to achieve a sales scale of 2 trillion yuan.

As the fastest-growing e-commerce platform in China, Douyin E-commerce's rapid growth is inseparable from ByteDance's robust and diverse content ecosystem and the traffic advantages brought by short videos.

Behind this is Douyin's pioneering "goods-find-people" logic, which 颠覆了传统， further amplifying the platform's traffic value. Additionally, Douyin's 升级 from interest-based e-commerce to the concept of 全域电商 has also played a 助推 role.

For Double 11 in 2024, Douyin has become the first to "jump the gun." Thanks to its first-mover advantage, Douyin's Double 11 has gotten off to a strong start.

According to the 战报 released by Douyin E-commerce on October 18, from October 8 to 17, the platform saw 52 brands with sales exceeding 100 million yuan, 323 live-streaming rooms with sales exceeding 10 million yuan, 247 single products with sales exceeding 10 million yuan, and 商品曝光超 200 billion times in live-streaming rooms.

Douyin's gradual rise, forming a 闭环 from content to e-commerce, can also be attributed to its increasingly 完善 platform ecosystem.

However, although Douyin E-commerce's GMV data is impressive, the growth rate of this performance indicator faces challenges.

According to LatePost, Douyin E-commerce's sales in Q1 2024 exceeded 700 billion yuan, a year-on-year increase of over 50%.其中， the cumulative year-on-year growth rate in January and February exceeded 60% (considering the 春节假期， statistics are usually combined), while March's year-on-year growth rate dropped to below 40%.

As early as July this year, there were reports that Douyin E-commerce's half-year GMV did not meet its 预设目标， with approximately 1.4 trillion yuan achieved in the first half of the year. Although Douyin E-commerce later responded that the data and the claim of 未及预期 were inaccurate, the 客观事实 of its slowing GMV growth is undeniable.

In fact, the "消费降级" trend deeply felt by the public in recent years and the overall slowdown in the e-commerce sector's growth also reflect the pressure on Douyin E-commerce.

According to 易观分析's estimates, in Q2 2024, China's live-streaming e-commerce market transaction 规模 reached 1,060.4 billion yuan, a year-on-year increase of 12.6%, with the growth rate declining by nearly 8% compared to the previous year.

Therefore, this year's Double 11, while Douyin E-commerce has started earlier and faster, with 明显 progress in live-streaming e-commerce, it also faces challenges such as 疲软的 industry growth and slowing platform GMV growth，可谓有喜有忧。

Behind Soaring GMV, Traffic Growth Is Weak

As Douyin E-commerce accelerates commercialization, the platform's traffic has been further 释放。公开数据显示， over the past year, 3.8 billion daily traffic entered Douyin's live-streaming rooms, and 8 billion daily traffic watched Douyin E-commerce's short videos. Meanwhile, Douyin E-commerce's GMV increased by 46% year-on-year，货架场景 GMV surged by 86%, and live-streaming drove 商家销量增长 57%.

However, as Douyin E-commerce rises, it has become increasingly difficult to balance the interests of all parties on the platform. In recent years, with the 娱乐泛化 of platform traffic，主播素质参差不齐。

Some influencers have been "exposed" for selling counterfeit products，涉嫌虚假宣传， or "performative"带货， posing new challenges for Douyin E-commerce's platform governance and 规则层面的利益平衡。

Around the Mid-Autumn Festival and National Day holidays, within about a month, top influencers like 疯狂小杨哥，东北雨姐， and 董宇辉 were 相继卷入舆论风暴. The 崩塌 of top influencers' personas and 大量脱粉 have also impacted the platform's traffic.

At the same time, due to updates in platform rules, the interests of B 端商家 and C 端 consumers on Douyin E-commerce have become increasingly difficult to balance. As a result, Douyin was forced into a price war to counter other platforms' "low-price" strategies.

For a time, products on the platform were divided into three categories: "全网低价，" "同款低价，" and "同款高价."

This led to consumers prioritizing price, forcing merchants into a "price war." Under the 低价 trend, some merchants could only maintain meager profits by lowering product quality, plunging the entire platform into a 恶性循环 of 劣币驱逐良币， and the platform's 生态也难言健康。

Fortunately, Douyin E-commerce has recognized the problems this has caused. Therefore, Douyin has 明确内部经营目标的优先级， no longer prioritizing "price 力，" but instead focusing on pursuing GMV growth.

However, Douyin E-commerce's excessive pursuit of GMV is also a double-edged sword, bringing new problems.

Under Douyin E-commerce's current operational 机制， whether merchants rely on self-streaming or top influencers for 带货， costs remain high.

Merchants' self-streaming traffic relies entirely on purchases, and 流量成本 is 越来越高. If they rely on 达播 with traffic advantages, they face exorbitant 坑位费 and high 佣金抽成. This means merchants' profits are squeezed not only by influencers but also by the platform.

Especially as top influencers 密集翻车 and other live-streaming platforms like 视频号 rise, Douyin E-commerce, which once had no shortage of traffic, is gradually 陷入流量增长乏力的困境，不得不通过抬高流量的价码来 "变现."

The most obvious change is that merchants' operating costs on Douyin are 越来越高. One merchant 吐槽 to the media: "I sold 520,000 yuan worth of goods in a week, but in the end, only less than 80,000 yuan reached my account."

An investor even stated that Douyin's brand 自播间 "gets no traffic without payment," requiring constant purchases to maintain sales. Additionally, the investor revealed that merchants'自播间流量费用占支付 GMV 比例 often exceeds 50%.

Thus, driven by new goals, Douyin E-commerce has shifted from one extreme of "price 内卷" to another extreme of "increasingly expensive traffic,"再次失衡各方利益。

Ecosystem Shortcomings Are Hard to Fix, a Long Road Ahead

As a live-streaming e-commerce platform transitioning from short videos, Douyin E-commerce is a latecomer with 天然存在的供应链短板， which it is 加速补齐。

For example, at the opening ceremony of the China New E-commerce Conference in late September, Zhang Fuping, Vice President and Editor-in-Chief of ByteDance, revealed that in 2023, Douyin E-commerce had covered 684 distinctive 产业带 across China. By the end of this year, the platform aims to build 20 100-billion-yuan 产业带。

However, while integrating 上下游产业带， Douyin's 供应链资源 still 难以做到全面覆盖. Especially in recent years，无货源商家 have proliferated on the platform.

Previously, topics like "goods purchased on Douyin were actually shipped by other platforms like Pinduoduo, with price differences as high as 5 times" trended on 热搜， drawing criticism for Douyin E-commerce.

Although Douyin E-commerce has 打击无货源商家 by requiring merchants to provide 电子面单 for shipments, the issue persists, and consumer complaints continue.

In response, Douyin E-commerce is gradually 完善供应链，物流等 "infrastructure"建设， adjusting platform rules, balancing 多方利益， and improving the shopping experience.

At the "User Experience Open Day" hosted by Douyin E-commerce in Beijing in mid-May, the platform's business 负责人介绍称， in customer service, Douyin E-commerce is continuously improving 三大服务能力—"platform 客服，" "merchant 客服，" and "influencer 客服"—to ensure consumers "only need to contact once" for help.

In logistics, the platform has optimized 整体发货时长， shortening it by 11 hours. Meanwhile，特色物流服务 like "当日达" and "选日达" have become more diverse.

However, Douyin E-commerce started late, and users'搜索心智 and 低价心智 on the platform are limited. Although its 商业生态 has gradually formed a 闭环， compared to Alibaba and JD.com's 成熟的会员体系， most buyers on Douyin are new users trying it out, with few repeat customers, resulting in low 复购率. Additionally, due to poor shopping experiences，退货率 remains high.

According to the "2020 China Live-Streaming E-commerce Industry Research Report," the average return rate for live-streaming e-commerce is between 30%-50%, far higher than the 10%-15% for traditional e-commerce. In July 2023, Douyin's 珠宝商退货率 was reported to be as high as 90%.

In the 女装 sector, a return-heavy area, e-commerce platforms generally see return rates of around 50%, with Douyin's reaching 70%-80%. During this year's 618 shopping festival, the topic of 女装退货率高达 80% even trended on 热搜。

To reduce return rates, Douyin has been 押注平台搜索流量 and 布局货架电商. According to Tech Planet, Douyin E-commerce launched an app called "Douyin Mall" earlier this year, promoting "great deals and worry-free shopping."

Wei Wenwen, President of Douyin E-commerce, once stated that 货架 GMV would account for 50% of Douyin's future 份额. However, at the Douyin Ecosystem Conference in May 2023, Wei mentioned that 货架场 GMV 占比 had reached 30%. By 2024, according to Duojiao Finance, this proportion exceeded 35%, still far from the 50% target.

In reality, while 布局兴趣电商， Douyin's "念念不忘" of 货架电商 has 陷入了一种逻辑悖论. This is evident when comparing 小红书's struggles in e-commerce due to its stronger 私域属性. Currently，小红书商城 still lacks 搜索流量， and platform 博主带货 relies entirely on posting notes.

Moreover, ahead of Double 11, many 博主反馈 that 小红书's natural 推荐流量 has 骤减， with "小眼睛" (representing views) 甚至变成个位数. Now，流量获取 requires 商家 "buying 流量，" mirroring Douyin E-commerce's 尴尬状态。

Although Douyin is making waves in e-commerce, even launching an 独立抖音商城 app to seek further growth, its 近年抛出的 "interest 电商" and "全域电商" concepts aim to clarify its e-commerce 转型目标。

However, this move also faces challenges. As 短视频平台流量红利 fades, top influencers 密集塌房，知名品牌心生退意， and 白牌大量涌入， Douyin's e-commerce advantages are gradually eroding, and its 短板 are becoming 暴露。

Until these issues are resolved, Douyin's e-commerce 转型 cannot be deemed successful. Fortunately, as an industry latecomer, Douyin is 快马加鞭，加速完善平台生态与体验. With many 筹码 in hand, Douyin E-commerce could still 弯道超车. The 2024 Double 11 will be the ultimate test—let's wait and see.

References:

1. "Douyin E-commerce's Dilemma: Traffic Is Too Expensive, Seen as a 'Promotional Platform' by Merchants" - Bohu Finance

2. "LatePost Exclusive 丨 Douyin E-commerce's Sales Growth Slows for the First Time" - LatePost

3. "2024 E-commerce 618 Observations: The Best of Times, the Worst of Times" - Zouma Finance

4. "Analysys: China's Live-Streaming E-commerce Market Transaction Scale Reached 1,060.4 Billion Yuan in Q2 2024, Return Issues Reflect Industry's Urgent Need for Transformation" - Analysys

5. "Xiaohongshu's Commercialization Maze!" - Times Finance APP