Author｜Lu Yao

Over the past few years, in order to compete for users and transaction mindshare, both new and old e-commerce platforms have regarded traffic and closed-loop ecosystems as the foundation for their own development, with price wars once becoming the core competitive means of the industry.

After experiencing the "hardest 618" in history, this year's Double 11 has finally seen some changes: barriers between platforms are beginning to be broken down, the event period is being extended, and business is gradually returning to its essence.

Major e-commerce platforms have also begun adjusting their strategies, shifting from purely price wars to multi-dimensional competitions of comprehensive strength in terms of cost-effectiveness, experience, operating costs, efficiency, and more. The logic is simple: merchants must have traffic, profit, and certainty, so that the platform's business model can achieve a positive cycle.

According to statistics, by the end of August this year, there were 125 million individually-owned businesses in China, accounting for two-thirds of the total number of business entities in the country. For any e-commerce platform, small and medium-sized businesses represent the largest proportion, have the keenest senses, and feel the deepest impact of platform strategy adjustments.

The flow and investment of small and medium-sized businesses largely represent the size and difficulty of business opportunities, whether they are long-term or short-term. Compared to extreme pandering to users, providing new merchants, especially small and medium-sized businesses, with more attractive options in terms of traffic, subsidies, and game mechanics has become the focus of competition among e-commerce platforms.

In this round of competition, the platform that significantly exceeded expectations was Kuaishou E-commerce. During this year's Double 11, Kuaishou's platform subsidies and operating mechanisms returned to the basics of content fields and live broadcast rooms. The number of merchants registered for the promotional event exceeded 3 million for the first time, setting a new record. During the entire Double 11 promotional cycle, the number of new small and medium-sized merchants with active sales on Kuaishou E-commerce increased by 167% year-on-year; the GMV achieved by small and medium-sized businesses increased by 156% year-on-year; and the number of product categories with active sales by small and medium-sized businesses increased by 77% year-on-year.

Kuaishou's third-quarter financial report revealed that, thanks to various support plans for new and small-to-medium businesses, the scale and performance of small-to-medium businesses on the platform exceeded expectations. The number of new merchants joining Kuaishou in Q3 increased by over 30% year-on-year, and the average operating income per store for new merchants increased by over 60% year-on-year during the quarter.

The rapid growth in the number of small and medium-sized businesses and new merchants has not only enriched categories and ecosystems but also demonstrated differentiated supply-side capabilities. This also means that the merchant growth system constructed by the platform has gained the trust of users. Facing a white-hot market environment, merchants on Kuaishou can still find stable business opportunities.

What has happened behind this trend?

01

Great Content + Great Products

A New Way of Life for Industrial Belt Merchants

Over the years, unlike other platforms, on Kuaishou, we often see examples of a large number of native merchants emerging from industrial belts. They come from different industries but share similar characteristics, such as obvious industrial agglomeration, being predominantly small to medium in size, and following traditional production and business models.

In order to break through geographical restrictions and reduce intermediate links to increase profits, these industrial belt merchants are facing an urgent need to transition from offline to online. For them, live streaming e-commerce, which has a lower entry threshold, seems like a shortcut, and emerging platforms often provide more sincere support policies to help them integrate into new business models more quickly.

Among the many transforming industrial belts, fur, with its expensive, niche, and non-standard characteristics, has become one of the most popular women's wear categories on Kuaishou E-commerce. This industry experienced a golden period of rapid development years ago, but subsequent issues such as supply-demand imbalances, overcapacity, and lack of innovation led to the gradual loss of traditional consumers, and many merchants felt that business was becoming increasingly difficult.

Cai Jiatong is one of the members of the fur industry's transformation wave. Starting as a physical wholesaler, she began to dabble in Kuaishou around 2018, initially using it as a supplement to her offline business. However, to her surprise, the following year, when she had around 5,000 fans, her account @CC Datongtong attracted over 1,000 simultaneous online viewers during its first live broadcast.

This experience not only made her realize the potential of Kuaishou in converting private traffic but also strengthened the team's decision to focus their efforts on Kuaishou. Since 2020, Cai Jiatong's business has grown even larger with the help of Kuaishou. The team has expanded to over 70 people, with 4 operational accounts on Kuaishou and a rapidly growing fan base of over 1.3 million. Currently, Kuaishou has become Cai Jiatong's primary sales channel, accounting for 70% of her sales.

Cai Jiatong's choice of Kuaishou was not accidental.

As one of the largest and most active platforms in China, Kuaishou's new-tier population, dominated by users from third- and fourth-tier cities, is demonstrating increasing purchasing power, greatly expanding the consumption region and demographic for fur. Buying mink coats is no longer just a choice for middle-aged and elderly people; it is attracting more young users to place orders and is no longer exclusive to northerners; more southerners are also falling in love with buying mink coats. This has brought huge online dividends to traditional merchants in fur industry bases such as Haining, Zhejiang, and Tongerbao, Northeast China.

On the other hand, Kuaishou's support for industrial belt merchants is also one of the important reasons for merchants' choice. In April 2024, Kuaishou E-commerce launched the "Handpicked Origin" IP, beginning to create influential origin name cards for 10 key Kuaishou women's wear industrial belt cities such as Guangzhou, Shenzhen, Hangzhou, Zhengzhou, and Wuhan, vigorously supporting the growth of small and medium-sized businesses.

Kuaishou's emphasis on industrial belts stems from its core strategy of "Great Content + Great Products," aimed at building its own supply characteristics through differentiated cost-effective and high-quality products from the source by integrating the e-commerce industry chain. In recent years, Kuaishou has continuously increased its efforts to attract key categories from industrial belts, providing support policies for merchants while summarizing a series of content e-commerce operating methodologies to help new merchants integrate into the Kuaishou e-commerce ecosystem as soon as possible.

Taking Cai Jiatong as an example, during this year's Double 11, by participating in exclusive events such as Kuaishou's "Quality Mink Coat Festival," she achieved remarkable results in scarce traffic inlets. During Double 11, with the help of incentive policies such as cash subsidies and traffic rewards, she prepared in advance, selected popular products, reinvigorated her business, and achieved a single-session transaction volume of over 15 million yuan.

Unlike direct subsidies or game rules with high entry barriers, on Kuaishou, as long as business growth is achieved, merchants are likely to seize more traffic opportunities on the platform. Small and medium-sized merchants with different operating characteristics and advantages not only achieved significant business growth but also raised expectations for the entire category and even the industry.

Official Kuaishou data shows that from October 25th to 31st, the GMV of mid-to-high-end mink-related clothing on the platform increased by 56% year-on-year, order volume increased by 62%, the number of buyers increased by 56%, and the number of new buyers increased by 46%, with both supply and demand maintaining a trend of rapid growth.

In Tongerbao, Liaoning, known as the "Fur Capital of China," thousands of offline merchants, hundreds of wholesale merchants, and supply platforms have found new ways to survive on Kuaishou. A deep online and offline integration has formed between wholesale-retail, wholesale-e-commerce, and retail-e-commerce, further driving the iteration and upgrade of the industrial belt.

02

Full Cycle + Full Domain

Opening Up New Business Spaces

The phenomenon of more and more small and medium-sized businesses turning their attention to Kuaishou has actually been traceable for some time.

Unlike centralized recommendation algorithms, Kuaishou's relatively decentralized mechanism allows small and medium content creators more opportunities to gain attention and exposure. As a large number of users on the platform began live streaming their own orchards, factories, and stalls, the embryonic form of trust e-commerce gradually formed with the help of the trust endorsement formed by community culture.

Unlike other platforms, the advantage of Kuaishou's community culture lies in the fact that once fans are attracted, the stickiness and conversion rate are higher, and the platform's repeat purchase rate once exceeded 60%. Small, medium, and even long-tail merchants are not only the most valuable producers of original content but also an important part of Kuaishou E-commerce's appeal.

Kuaishou's latest financial report shows that since 2020, Kuaishou's daily active users have increased from 264 million to 408 million in the third quarter of this year, a record high, and users open Kuaishou to watch live broadcasts and short videos nearly 110 billion times a day. The continuous growth of traffic volume means that doing e-commerce on Kuaishou is still a land of opportunity.

For small and medium-sized businesses and new merchants, even greater opportunities come from field dividends. In addition to the content field of live streaming e-commerce, short video and image-based e-commerce supported by Kuaishou, as well as pan-shelf scenarios represented by search and malls, are providing merchants with more certain growth and incremental space.

Data shows that during Double 11, the number of short videos with shopping carts on Kuaishou increased by 10 times year-on-year, becoming a new business field; small and medium-sized merchants achieved sales explosions across the board, with GMV in the live broadcast field increasing by 46% year-on-year, GMV in the short video field increasing by 112.6% year-on-year, and GMV in the pan-shelf field increasing by 330% year-on-year.

The overall increase in traffic, combined with the platform's field dividends, game mechanics dividends, red envelope subsidies, special plans and operating methodologies initiated by the platform for industrial belt merchants, have opened up new business spaces for small and medium-sized businesses and new merchants.

Take Zhang Ming, the owner of a truck repair shop who has just transitioned from short video e-commerce to live streaming, as an example. As one of the first vertical short video influencers in truck repair in Northeast China, his Kuaishou account has posted thousands of video works and accumulated millions of fans. During Double 11 this year, without any live streaming e-commerce experience, Zhang Ming's single-session live broadcast GMV after the transition exceeded one million yuan. How did he do it?

After 12 years in business, Zhang Ming operated a truck repair shop offline and had stable goods channels, including offline authorized dealers of brands such as Shell and Bosch, with products covering diesel filters, air filters, blow guns, and other automotive products.

Before going live, like most newcomers, he lacked confidence and a professional team, did not understand the basic gameplay of live streaming e-commerce, did not know how to organize products, and did not know how to set welfare products. However, with the full-service support of Kuaishou E-commerce assistants, including guidance on live streaming scenarios, scripts, product organization strategies, and broadcast rhythms, by sorting out the product inventory in advance, frequently releasing warm-up videos, and offering discounts and benefits in the live broadcast room, Zhang Ming achieved a smooth transition to self-broadcasting.

It is worth mentioning that for new merchants like Zhang Ming, the platform has provided a series of welfare policies. The "New Merchant Launch Plan" provides new merchants with guaranteed cold start traffic and low-threshold store opening opportunities. When high-quality merchants grow to a certain level, Kuaishou will continue to invest over 70 billion yuan of traffic through the "Upward Mobility Plan" to help them make the leap.

For example, when "Panjin Baishi Rice" first joined the platform, it participated in the New Merchant Launch Plan and received over one million traffic exposure opportunities in the first week. In the fifth month of joining Kuaishou, its monthly GMV exceeded 2 million yuan; merchant "Double Star Outlet Store" participated in the New Merchant Launch Plan and received over 40% of the platform's reward traffic in the first week, with a monthly GMV exceeding 1.5 million yuan within less than six months of joining.

In addition, "Shenzhen Ouhuo Chaojie" and luggage category merchant "Yinian" closely followed the platform's category day gameplay warm-up during the promotional period, participated in the platform's full reduction subsidy activities, used tools during live broadcasts to draw lots to increase user dwell time and interaction rates, and leveraged platform support such as the "Upward Mobility Plan" traffic and surprise red envelopes. The former achieved a single-session GMV of nearly 4 million yuan during the clothing warmth festival, breaking its historical peak; the latter achieved a single-session GMV of nearly 10 million yuan, refreshing the record for the luggage and accessories category.

In fact, in 2024, Kuaishou's cold start traffic coverage for new merchants has stably exceeded 95%; in the second half of the year, Kuaishou E-commerce launched a series of subsidy policies, ranging from the New Merchant Launch Plan to reducing deposits to support small and medium influencers, to launching the "New Star Plan" and "Explosion Plan," as well as the Doujin Plan, zero-yuan store opening, return subsidies, sales trusteeship, and other services.

These support policies cover multiple aspects such as traffic, gameplay, and funding, spanning the entire life cycle from new merchants' entry and cold start to stable growth, ultimately forming a complete support system. Nowadays on Kuaishou, a clear trend is that not only are more and more merchants choosing Kuaishou, but also more and more new merchants are standing out from the crowd.

03

AI + Intelligence

Efficiency Lever of New-quality Commerce

Thanks to various support plans for new and small-to-medium businesses, in Q3 of this year, Kuaishou's average monthly active merchants increased by over 40% year-on-year, and the number of new merchants increased by over 30% year-on-year. During Double 11, over 2,500 live broadcast rooms achieved transaction volumes exceeding one million yuan, and the content field GMV of 57,000 merchants exceeded previous records.

Since 2018, the rise of short video and live streaming platforms has brought tremendous changes to merchants' business models. Whether for large brand enterprises or small and medium-sized businesses, filtering out intermediate links and directly facing end consumers has become a required course.

Compared to the initially rapidly growing traffic volume and low-hanging fruit, the internal ecological complexity and intensity of competition within all e-commerce platforms have now reached unprecedented levels. In previous years, both brand merchants and influencer merchants could easily achieve multiplication and explosion with creative advantages and live streaming expertise, bolstered by traffic dividends.

Today, to achieve the same growth, merchants may need to invest more manpower, energy, and even capital, especially for small and medium-sized businesses and new merchants, which poses a huge challenge.

In this context, creating a sustainable and practically relevant growth model has become an important issue for platforms and merchants.

Generally speaking, when content platforms engage in e-commerce, the general framework revolves around short videos and live streaming. Between great content and great products, the platform acts as a connector, attracting users' attention through high-quality content creation and then converting traffic into actual commercial value. Nowadays, this is no longer enough.

E-commerce platforms not only need to provide systematic support policies but should also focus on the creation and iteration of business ecosystems to help small and medium-sized businesses upgrade their business models: on the one hand, shortening consumers' decision-making chains, and on the other hand, simplifying and shortening the business chains of small and medium-sized businesses to provide higher business efficiency and a more certain input-output ratio.

This model of growth relying on new-quality productivity is called "new-quality commerce," with AI and large model-based recommendations, matching, and intelligent operations as its underlying logic.

For example, some small and medium-sized businesses face difficulties in recruiting and training anchors, but Kuaishou's launched Nuwa digital human live streaming tool can effectively reduce business operating costs and minimize the impact of anchors on business. There are also AI scripts, smart main images + title generation, and other e-commerce AI smart tools.

Another example is the pre-sales/after-sales large model intelligent customer service built on the Kuaishou large model team. The customer service robot can automatically reply to a large number of high-frequency questions through the large model's full dialogue understanding and response capabilities, greatly reducing peak customer service response pressure and labor costs.

Traffic is the foundation of online operations. In the past, there were thresholds for small and medium-sized businesses to place advertisements. However, through intelligent trusteeship tools such as full-site promotion, live broadcast trusteeship, and full-product intelligent investment, simplifying advertising operation difficulty can also help accelerate the incubation of small and medium-sized businesses. It is understood that in the first half of 2024, nearly 20,000 merchants achieved intelligent operations with the help of large model capabilities on the Kuaishou platform, and the average daily consumption of AIGC marketing materials reached 20 million.",