There was once a heated discussion in the e-commerce industry: Should e-commerce platforms follow the shelf-based model or the content-based model?

From the subsequent development of the industry, the integration of content-based e-commerce and shelf-based e-commerce has emerged as the mainstream approach. For example, Douyin E-commerce has interconnected its content-based e-commerce, dominated by short videos and live streams, with shelf-based e-commerce features such as malls, search, and stores, bringing new growth to businesses.

The results show that Douyin E-commerce's "interconnection" strategy has achieved remarkable results. According to the data report on the 2024 "Douyin Mall Double 11 Shopping Festival" released by Douyin E-commerce on November 14, from October 8 to November 11, over 33,000 brands saw their transaction volumes double year-on-year, nearly 17,000 brands witnessed growth rates exceeding 500%, and more than 2,000 products surpassed ten million yuan in transaction volume. Transactions driven by the shelf-based model continued to rise, accounting for 42% of the total, with a 170% year-on-year increase in transaction volumes for super value purchases and a 130% increase in the number of users placing orders for such purchases.

△Data from the 2024 "Douyin Mall Double 11 Shopping Festival"

The increase in the proportion of transactions from the shelf-based model indicates that users not only enjoy browsing Douyin content but also like shopping on Douyin Mall, with their browsing and searching habits on Douyin Mall gradually forming. Meanwhile, Douyin's shelf-based e-commerce has gradually become an important growth area for businesses. So, what did Douyin E-commerce and businesses do right behind this success? These answers can provide more valuable insights for the e-commerce industry.

01

How does shelf-based e-commerce drive business growth?

Clothing is undoubtedly one of the most fiercely competitive businesses in China.

Many clothing merchants have faded away due to failing to keep up with changes in products and channels. However, some merchants have not only survived but have expanded their businesses. "Shirt Lao Luo," a clothing brand, is one such example. Its founder, Luo Xinhua, has constantly adjusted the business focus in response to industry trends, shifting from short videos and live streams to shelf-based e-commerce.

In Luo Xinhua's view, to build a genuine brand, one must prioritize the mall. Compared to content-based e-commerce like short videos and live streams, shelf-based e-commerce platforms like malls can present brands in a more aesthetically pleasing manner, encompassing visual design, brand copywriting and storytelling, product details, and more. This allows users to gain a more comprehensive and three-dimensional understanding of the brand and products, thereby successfully embedding the brand in users' minds and solidifying brand value.

Therefore, two years ago, "Shirt Lao Luo" firmly embarked on shelf-based e-commerce, building Douyin E-commerce's shelf-based model and increasing investment in store operations, including visual and copywriting upgrades, search term optimization, dedicated customer service, and more.

The compounding effects of time are increasingly evident. Today, "Shirt Lao Luo" has achieved a "price and volume increase" on Douyin E-commerce—its Douyin store has over 2 million followers, driving sales exceeding 5.44 million. Simultaneously, "Shirt Lao Luo" has placed high-ticket items like suits in the mall, doubling the store's average transaction value. This is because Douyin Mall provides users with a decision-making space for high-ticket purchases, enabling merchants to increase their average transaction value.

△"Shirt Lao Luo" Douyin Official Flagship Store

Today, the mall has become a key area for "Shirt Lao Luo" to build its brand, putting it ahead of many peers. While many brands hesitate about prioritizing shelf-based e-commerce, "Shirt Lao Luo" has already reaped the benefits on Douyin Mall and is further enhancing its store's competitiveness. For instance, there are dedicated store personnel for refined operations, optimizing shelf-based e-commerce through AI tools to improve operational efficiency and user experience.

Many clothing brands have taken a similar path as "Shirt Lao Luo", deeply embedding themselves in Douyin E-commerce's shelf-based model, driving overall transaction growth.

In September 2021, Li Jianhong and his wife began their layout in Douyin E-commerce. In their view, high-quality products will attract users who actively search for them, even without active promotion, creating a potential market. Therefore, for a brand to achieve sustained growth, it is not enough to excel in content scenarios; it must also handle shelf and search scenarios well.

This is indeed the case. An important link between content-based and shelf-based e-commerce is search. After being influenced by various content, search is the path for users to make purchasing decisions. In 2022, Li Jianhong and his wife established a shelf-based e-commerce presence, opening the "Zangliyang" Douyin store. As of June 2024, the store had sold over 270,000 pieces of clothing, ranking first on Douyin Mall's cashmere sweater store list, with a repurchase rate exceeding 90%.

△"Zangliyang" Douyin Store

During this year's Double 11, over 122 clothing brands surpassed 100 million yuan in transaction volume on Douyin E-commerce, with over 10,000 brands doubling their transaction volumes. Many of these brands, like "Shirt Lao Luo" and "Zangliyang," have tapped into incremental growth by embracing shelf-based e-commerce.

In fact, shelf-based e-commerce is indeed an important growth area for the current e-commerce industry, determined by its many inherent advantages.

For example, users can either let products find them in content scenarios or actively search for products in shelf-based scenarios, enjoying more autonomy. In shelf-based scenarios, users discover that merchants not only offer excellent content but also high-quality products and services, receiving more information. Additionally, shelf-based e-commerce broadens merchants' product categories, accommodating repeat purchases and daily sales from both new and returning customers, enabling long-term and stable operations.

Overall, shelf-based e-commerce can increase the certainty of merchants' operations and growth opportunities for their businesses.

02

What Makes Douyin E-commerce's Shelf-Based Model Different?

As shelf-based e-commerce becomes the choice of many merchants, the practical question before them is which platform to prioritize. It can be observed that Douyin E-commerce is increasingly favored by merchants. Data released by Douyin E-commerce shows that from January to September 2024, the number of Douyin brand merchants increased by 165% year-on-year.‌

So, what makes Douyin E-commerce's shelf-based model attractive compared to other e-commerce platforms? Insights can be gained from merchants' specific operations.

In 2021, Hisense embarked on Douyin E-commerce with a trial mindset and discovered that Douyin users' spending power was surprising. On traditional shelf-based e-commerce platforms, low-priced products like 55-inch and 65-inch TVs are often the main drivers of sales. However, on Douyin E-commerce, users filtered into stores through live streams and short videos have higher product configuration requirements. Larger, high-priced models like 75-inch and even 85-inch TVs have become the main sales categories.

△Hisense Douyin Official Flagship Store

Similarly, Wu Nan, the head of the "Wudashu Chuanggaoxie" women's shoe brand, also found that the "content + shelf" model on Douyin E-commerce can achieve impressive business results.

Since 2008, Wu Nan has founded online stores selling women's shoes twice but both ended in failure. In 2020, a friend suggested that Wu Nan personally try on high heels, as it could create buzz and attract attention in this attention-driven era. After posting a Douyin video of himself wearing high heels, Wu Nan indeed attracted many viewers.

As a result, Wu Nan frequently posted Douyin videos of himself running in high heels, constantly adjusting shoe details during the wearing process. More and more people got to know him through these videos and regarded him as an "expert on high heels." Of course, in his view, short videos are a source of traffic, live streams are a service carrier, and the mall is a transaction venue. Content is just the first step; the combination of short videos, live streams, and shelves is the focus.

Data supports Wu Nan's viewpoint. In 2022, Wu Nan sold over one million pairs of women's shoes, and in the first quarter of 2023 alone, he sold over 500,000 pairs, ranking among the top footwear brands on Douyin E-commerce. Meanwhile, the proportion of pan-mall transactions on the Douyin E-commerce platform increased from 25.95% in 2022 to 36.14% in 2023, indicating that the mall is becoming an increasingly significant transaction venue.

△"Wudashu Chuanggaoxie" Douyin Official Flagship Store

From these cases, it can be concluded that the biggest difference between Douyin E-commerce's shelf-based model and other e-commerce platforms lies in its deep integration with content scenarios.

Specifically, Douyin E-commerce's shelf-based and content scenarios are deeply integrated. The platform's abundant short videos and live streams make it easier for merchants to promote products, while well-developed shelf-based features like malls and stores can smoothly receive traffic, achieving a unity of brand promotion and sales.

Furthermore, Douyin E-commerce's "content + shelf" ecosystem provides merchants with greater flexibility in operations, offering a more stable connection channel between merchants and users. Simultaneously, this ecosystem can accommodate repeat purchases from both new and returning customers, providing merchants with a more stable daily operations base and income even when not live streaming, thereby achieving long-term and stable business growth and robust expansion.

Behind Douyin E-commerce's "content + shelf" ecosystem, there are diverse mid-tier influencers, brands across various categories, and small and medium-sized stores from various regional characteristic industries, jointly shaping an active ecosystem across the board and presenting merchants with more possibilities for business growth. This is the unique value that Douyin E-commerce's shelf-based model brings to merchants.

03

Integration Capability: Coordinated Development of "Content + Shelf"

For many merchants, although they are aware of the possibilities that "content + shelf" brings to their businesses, they still lack a methodology in practical operations.

From numerous merchant cases, Yidian Caijing has observed that integration capability is the key to achieving business growth through "content + shelf".

For example, "Zangliyang" continuously connects content and shelf scenarios, integrating resources from both fields.

After creating best-sellers in live streams, "Zangliyang" lists these products in its store. Typically, products that have been tested in content scenarios have a high likelihood of becoming best-sellers in the mall as well, reducing merchants' trial-and-error costs and factories' inventory risks.

A typical example is "Zangliyang's" "banana pants," a knitted trouser that sold over 20,000 pieces on Douyin E-commerce. After analyzing sales data, "Zangliyang" found that almost all buyers who purchased banana pants in live streams would repurchase other colors of the same style from the Douyin store.

"Shirt Lao Luo" treats content and shelf scenarios as different channels for communicating with users, actively seeking user feedback to gain insights into their needs.

For instance, Lao Luo places great importance on every communication with users. On the one hand, he engages in high-frequency bidirectional communication with users in each live stream in content scenarios to quickly obtain feedback. On the other hand, he also revisits thousands of users who have placed orders in the mall's shelf scenario, reading through hundreds of thousands of comments to gain more in-depth and comprehensive feedback.

In this way, Lao Luo can achieve different types of communication with users through content and shelf scenarios, obtaining feedback at different levels. This not only allows him to more accurately grasp users' pain points but also reduces intermediate costs like inventory and distributors through direct sales conversations.

Besides, some merchants promote shelf-based business growth by integrating platform resources and tools.

Xu Songbin is the founder of "Chuangxiang Lvzhou." Through deep cultivation in Douyin E-commerce's content scenarios, the exposure of Xu Songbin's green plant products has increased exponentially. When video content reached a certain scale, Xu Songbin leveraged group buying resources to increase sales volume, building a complete link from short videos to shelf-based e-commerce.

△"Chuangxiang Lvzhou" Douyin Official Flagship Store

In Xu Songbin's view, compared to the investment in live streams and short videos, the operational costs for Douyin E-commerce's shelf-based model are lower. If the platform's natural traffic is effectively utilized, sales can grow steadily and continuously. More importantly, the platform's commission-free policy for product cards saves merchants a significant amount of costs and provides momentum for performance growth.

Chen Peilian, the founder of "Huazhitai," entered Douyin E-commerce in 2022. Today, sales from Douyin E-commerce account for approximately 80% of "Huazhitai's" e-commerce business. Chen Peilian believes that Douyin's shelf-based e-commerce offers many valuable tools, such as super value purchases and flash sales, which have substantial traffic. Merchants can quickly increase store exposure and sales by participating in these activities.

△"Huazhitai" Douyin Flagship Store

Overall, there is strong synergy between content and shelf scenarios on Douyin E-commerce. For merchants, leveraging the synergy between content and shelf scenarios and integrating resources and platform tools from both fields can potentially drive business growth.

04

Conclusion

The competition in the e-commerce industry will remain fierce in the future, but opportunities will continue to emerge.

Content-based and shelf-based e-commerce will remain the two main areas for merchants to operate, and platforms like Douyin E-commerce provide fertile soil worth cultivating for merchants. However, merchants should not be biased towards either content-based or shelf-based e-commerce but should instead enhance their integration capabilities for all-round development.