09/19 2024 404
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Growth trends towards certainty, and the answer lies in traffic.
Running a self-media account can easily lead to traffic anxiety. After posting new content, you constantly check your phone every minute to see the page views;
Running an e-commerce business can be even more anxiety-inducing when it comes to traffic. You want a surge in sales, but you also fear an unprepared explosion of orders.
Today, the environment and internal rules of e-commerce operations have undergone tremendous changes. However, regardless of how they evolve, three key words remain constant: user demand, traffic, and growth. The essence of traffic is the manifestation of user demand. Satisfying that demand generates traffic, and securing traffic captures business growth.
The traffic allocation mechanism is elusive, and user preferences are constantly changing. Solving the problem of "what to do to get more traffic" is a common challenge for tens of millions of e-commerce operators.
Who is better suited to answer this question? TikTok e-commerce, of course.
Over the past year, 3.8 billion pieces of traffic have flooded into TikTok live broadcasts every day, with a million-selling product emerging every 10 minutes. TikTok e-commerce boasts a vast and predictable traffic pool, and now they are trying to provide answers to the certainty of business operations for merchants.
Recently, TikTok e-commerce released the "CORE Operation Methodology," directly addressing the essence of operations, so that merchants' operational investments are no longer "throwing stones to see which way the water flows" but instead are "crystal clear."
Growth and iteration, TikTok e-commerce traffic mechanism evolving again
"Traffic" is the moat of TikTok e-commerce. Over the past four years, leveraging this, TikTok e-commerce and platform merchants have achieved exponential growth.
From mid-2020 to the end of 2021, TikTok e-commerce embarked on interest-based e-commerce, activating users' consumption demand through content. The first merchants who followed TikTok e-commerce at its inception also reaped the traffic opportunities of this initial stage.
In May 2022, TikTok e-commerce upgraded its interest-based e-commerce model to omni-interest e-commerce, vigorously developing the shelf scenario. The following year, the shelf scenario accounted for 30% of GMV, and over 56% of merchants achieved over 50% of their GMV from the shelf scenario, marking significant business growth.
In 2024, TikTok e-commerce's traffic mechanism underwent a significant upgrade, with a clearer new traffic orientation towards content capabilities.
Currently, TikTok e-commerce's traffic pool consists of a transaction pool and a content pool. Among them, the transaction pool distributes traffic precisely, with effective e-commerce conversion, but too much transactional content can exceed user demand; the content pool, on the other hand, has a much higher traffic ceiling.
Under the new traffic mechanism, "good content" will become a key driver of business growth. Merchants are required to focus on refining their content capabilities, explore new content genres and formats, create content that users enjoy, optimize the interactive experience, continuously accumulate fans, and continually push through the growth ceiling.
Abundant aquatic plants inevitably lead to vigorous birds and beasts on the grasslands. The upgrade of TikTok e-commerce's traffic mechanism brings new business perspectives and opportunities to merchants on the platform.
In the era of omni-connectivity, every consumer behavior sends a signal that can potentially influence traffic allocation. What merchants can do is to precipitate traffic signals by optimizing products, content, marketing, and user experience. The accumulation of correct business actions can lead to a resonance of signals, attracting additional traffic from the platform.
These business actions that can enhance traffic have been organized by TikTok e-commerce into the CORE Operation Methodology, where C stands for Cost vs Quality (affordable and comprehensive products), O for Omni-Content (omnichannel content), R for Reach (marketing amplification), and E for Experience (enhanced user experience).
Traffic is not elusive but rather traceable.
As Theodore Levitt, the father of modern marketing, once said, customers don't want a quarter-inch drill bit; they want a quarter-inch hole. The essence of any business is to satisfy user demand. In the era of e-commerce, those who can better accomplish this task will gain more traffic and more predictable growth.
Four key actions to drive traffic growth
"CORE" is TikTok e-commerce's focus. How do they leverage traffic to continuously pour into merchants' businesses? Why does TikTok e-commerce have the confidence to say that doing these four things will lead to traffic and growth?
Let's break it down one by one.
Key Action 1: Affordable and Comprehensive Products to Stabilize the Basic Traffic Pool
In business, it's well known that a rich and price-tiered product offering can attract consumers. However, as users tighten their purse strings, becoming the new norm in consumption, simply achieving this is no longer enough; good prices are necessary to retain them.
According to official TikTok e-commerce data, stores with a higher SPU (Standard Product Unit) coverage are more likely to gain more traffic on the shelf scenario. Meanwhile, products with pricing advantages can increase their overall exposure by over 30%.
The C in the methodology, "Affordable and Comprehensive Products," starts from this point. To gain more stable traffic, merchants must offer a comprehensive product range, competitive pricing, optimize their shelves, and further launch exclusive new products.
Taking Luolai Home Textiles as an example, as a brand focused on mid-range products priced between 200 and 500 yuan, under the new competitive environment, Luolai urgently needed to further expand its audience and traffic entry points.
To this end, over the past year, they shifted their TikTok e-commerce strategy from entry-level products to a combination of "trendy products, blockbuster items, and regular products," and matched attractive prices for different product combinations, such as exclusive launch discounts and bonuses within 60 days of the launch. These actions successfully propelled rapid growth in the brand's bed linen category in the 500-2000 yuan price range.
Summarizing from a traffic perspective, the richness of offerings is the ticket to steady merchant operations, while good prices are the faucet that continuously attracts traffic. By offering a comprehensive product range, Luolai Home Textiles satisfied users' need for "having everything they want to buy." By setting tiered prices and offering discounts, they achieved "affordability," meeting users' need for "getting good value for their money." This approach aligns with the emphasis on "Affordable and Comprehensive Products" in the CORE Operation Methodology, ultimately leading to a significant resurgence for this established brand in a new field.
Key Action 2: Omni-Content to Break Through the Traffic Ceiling
Over the past four years, starting from content, TikTok e-commerce has achieved bidirectional growth driven by both "people finding products" and "products finding people." Content has always been a critical weapon in this process and an effective means for merchants to establish differentiation advantages.
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Based on this, O, "Omni-Content," represents the "biggest opportunity" that platform merchants should seize.
The key message behind CORE is that with the upgrade and changes in the traffic mechanism, merchants aiming to break through the traffic ceiling must not only ensure stable sales through basic live broadcasts and influencer collaborations but also create "good content" that users genuinely enjoy. They should attempt to attract more potential traffic by exploring new content, new gameplay, and sudden hot topics.
An example comes from COS. COS combined the Spring/Summer fashion show in Rome, Italy, with TikTok live broadcasts, allowing TikTok users to "virtually attend the show" through live streaming. In the fashion world, runway shows are a glamorous stage where T-stage performances enhance a brand's reputation. By watching famous fashion shows, users are easily influenced by the brand's aura, further embracing the affordable luxury that COS seeks to instill in their minds.
During the show, the brand's live broadcast room surpassed 10,000 concurrent viewers, reaching an all-time high. Additionally, users attracted by the unique content were relatively targeted, resulting in a 480% year-on-year surge in GMV.
While users enjoyed the content they saw, they also purchased the products they desired, fulfilling both their interest and shopping needs. This is the magic of "Omni-Content" in the CORE Operation Methodology. Such business stories of exponential growth through innovative content and formats occur almost daily on TikTok e-commerce.
Key Action 3: Marketing Amplification to Boost Traffic Peaks
Currently, a significant number of brands consider TikTok e-commerce as their primary venue for performance marketing. Leveraging the platform's rich marketing resources, merchants can ride traffic peaks to achieve explosive growth. Meanwhile, under the omni-connectivity traffic mechanism, marketing has also ushered in new changes and opportunities:
First, marketing is no longer simply about investing in traffic but requires more refined operations. Conducting marketing across all channels, from participating in channel activities to collaborating on major marketing IP events, can effectively amplify business.
Second, truly effective marketing goes beyond transactions and is not limited to TikTok e-commerce itself. While facilitating sales conversions, it also builds brand reputation and audience assets, contributing value to businesses across the entire network and bringing all-round growth to merchants.
In other words, achieving R, "Marketing Amplification," activates the "accelerator" for merchant operations.
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Taking Fenty Beauty By Rihanna as an example, last year, the beauty brand leveraged Rihanna's TikTok live debut and guest appearances in top influencer live broadcasts, amassing over 38 million views and exceeding 6 million GMV in just one hour.
Capitalizing on the content buzz, the brand strategically leveraged the platform's marketing tool suite. Fenty Beauty By Rihanna deployed a marketing IP strategy by offering exclusive discounts and buy-one-get-one deals during "Brand Surprise Days." Additionally, they seized promotional occasions, introducing a refined dating set for 520.
This marketing campaign also became a typical case contributing to business growth across the entire network. It is reported that the hashtag #RihannaLiveStreaming# generated over 1 billion exposures across the internet, and three months later, new discussions about the brand could still be found on social media, demonstrating a significant long-tail effect. This validates the long-term value of "Marketing Amplification" in the CORE Operation Methodology for explosive growth.
Key Action 4: Enhanced Experience for Sustained Traffic
Looking to the future, businesses aim not just for impulsive one-time purchases but also for repeat purchases and customer retention, ensuring the sustainability of their operations.
The E in CORE, "Enhanced Experience," advises merchants that user experience must not only be good but also distinctive to continuously attract more users. Furthermore, optimizing E can positively impact C, O, and R, achieving greater results with less effort. From this perspective, E will also determine the upper limit of a merchant's business scale.
Taking the example of "Madali Cat Food," a rising star brand in the cat food category on TikTok e-commerce, user experience is crucial for a highly repurchased product like cat food. Madali invested 50% more manpower in customer service scenarios, not only focusing on user inquiries but also monitoring live broadcast and short video comment sections, turning live broadcasts into customer service scenarios and training customer service personnel as cat consultants.
As a result, Madali's overall membership transactions accounted for nearly 30% of total sales, with a membership repurchase rate of 50%. By optimizing the user experience to the utmost, Madali has carved out a name for itself in the pet industry, dominated by international brands, and completed the brand's initial accumulation among users. Fundamentally, the brand deeply satisfies users' "experience," exploring distinctive experiences based on product attributes. These efforts align with the core of "Enhanced Experience" advocated in the CORE Operation Methodology.
From methodology to practice, a clear path to growth
TikTok e-commerce encourages merchants to divert traffic and provides practical support. In the TikTok Compass CORE section, TikTok e-commerce provides merchants with indicator tools corresponding to the four sections of the methodology, facilitating merchants in judging how much operational effort is required to gain more traffic.
Additionally, the platform has launched DOU Lab, the TikTok e-commerce ecosystem laboratory, working with brand service providers to create a series of tools and solutions tailored to address common operational pain points across the four CORE sections.
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On TikTok e-commerce, users, traffic, and growth mutually support each other.
By meticulously cultivating C, R, and E, merchants can ensure a stable traffic supply on TikTok's comprehensive content and shelf e-commerce platform. Meanwhile, through O, they can open up the ceiling of their operations and expand their business scale.
Each iteration and upgrade of the methodology is a co-creation between merchants and the platform, ultimately leading to mutual benefits and evolution for both. There is reason to believe that the CORE Operation Methodology will help more merchants find valuable certainty amidst change.