Analyzing market competition pattern from price sensitivity

Because the buyers and sellers do not trust each other, although the cost of e-commerce operators become High, and online consumer experience flow becomes not smooth, but still can not prevent China's e-commerce fast growth. Life itself will find a way out, in China, the final E-commerce can also find a suitable for the "" The survival of the way, may be a long time to explore.

Because China is a society that trusts scarcity, it makes the value of brand electric power more prominent . Since last year, Beijing Zhongguancun more than digital shopping malls closed, highlighting the current consumers may think that the physical store to buy digital goods, but also in the well-known E-commerce website consumption reliable, and more easily, door-to-door speed and fast.

In addition, Taobao led the consumer-to-consumer of many years of trading mode, although still in last year's double 11 big promotion (year of November 11 annual big sale) has reached the sky-high transaction volume, but in recent years independent consumer electric Business website Education, has cultivated a batch of "feel a little bit more expensive, has the safeguard more important" consumers.

In particular, the coastal first-line cities to buy consumers, has been quite a degree to cultivate "buy digital on Jingdong, buy a book when, buy xx on the yy" such brand name degree. " This is the characteristics of the big city consumers, time is precious, do not want to spend too much on the internet to Amoy goods. So like Taobao Consumer-to-consumer this online shopping model in the first-tier city is gradually not flattering.

and Taobao Consumer-to-consumer above consumers, is a group of very tricky consumers, very willing to spend a lot of time to find the lowest price quality acceptable goods, and enjoy. Highly price-sensitive, highly-experienced, so that they can identify whether the seller is sold as a fake (the author has been chatting with a number of senior Taobao buyers, their ability to identify fakes stunned).

Looking at the market pattern with the price sensitivity of consumers

If we differentiate China's e-commerce market by price sensitivity, there will probably be a scenario where relatively insensitive consumers (such as the writer's white-collar worker) are on independent consumer Web sites. In these websites can not buy, will think of Taobao to see. This group of people feel that it is worthwhile to spend a little more money to save trouble.

and Taobao market consumers are the most leisure time the most low-cost consumers, they can always find the most cost-effective goods. This group of people do not agree with the cat's slightly high-end platform positioning, that the cat on the quality of things or brands and Taobao market on the goods are not very different but the price is more expensive. Maybe the merchandise on the cat is really no fake, but they would rather search in the Taobao market.

The number of people who are sensitive to price is a lot more, so it will be said that Taobao still can lead the coquettish for many years. However, prices are not purely the sole determinant of online shoppers. For example, the parity search engine in China for many years, the number of business E-commerce market has sprung up, but also did not see which parity search site successfully gathered a lot of popularity.

Therefore, if we are in accordance with price sensitivity to distinguish the current e-commerce market in China, you can draw the following graphics: In accordance with the price sensitivity from low to high, in turn, the Independent Business E-commerce website, parity search engine (to Etao a Amoy as the representative), and then to the Cat mall, such as the platform, Finally, Taobao Bazaar and other Consumer-to-consumer platform.

(chart) Differentiating China's E-commerce market according to price sensitivity:

From the above figure, we can see how small the living space of the comparison search in China. Really care about the price of people, will not be in the independent consumer website shopping and will tend to consumer-to-consumer platform, as long as the use of Taobao site search is enough. The parity search engine, which overrides the consumer shopping website, can only pick up a small group of users because people who prefer to shop for independent consumers are actually less sensitive to prices.

The competition pattern of China's e-commerce market

In the recognition of E-commerce market has a long way to go, many independent business operators began to become pragmatic. The cost of media advertising is soaring, the order conversion rate due to a variety of trust factors can not be improved in the short term, so it is expected that a considerable number of independent web site will be stationed in a similar to the Cat Mall, the superior Amazon and so on to the platform.

to other platforms to open a branch in essence can increase orders, virtually also more exposure opportunities. Similar to the cat such a consumer platform, although it is unavoidable to put the station ads to bring traffic, but because the consumers came to the platform is already a clear intention of shopping, advertising efficiency than Baidu and other search engines are still high. Of course, consumer price sensitivity is still a problem.

Although independent of the rise in the past few years, but Taobao and the cat may still be able to continue to lead for some time. Large independent business as the author in the March 2011 article "The Future pattern of e-commerce in China will be" five Taobao mall, said, will continue to platform development, and small independent web site will continue to be stationed in these platforms.

(chart) The future competition pattern of China's e-commerce market:

In this market pattern, can survive is a large platform, relying on the richness of goods to attract users, once the commodity rich, the platform has a parity search function. And the other can survive in a commodity category in the field of self-brand electric dealers, dependent on a large platform to survive, by the platform cost-effective relatively high flow of the brand. It will be hard for the electric dealers to survive.

Competition between the Business-to-consumer platforms is far from being started. Even if Jingdong mall clamoring to Taobao with the world, it is not easy. Last year Taobao double 11 promotion and the cat double 12 to achieve a single day trading volume, if in the east on the same time, it is estimated that the Beijing-East site will be paralyzed. The Limit Jingdong Mall development is the technical ability, this is why Jingdong to dig Kok Oracle Vice president of the reason.

(article: "Ka Fung Capital" investment partner Huang Shaolin | Digital wall)