Suddenly shut down! Three more platforms are "down"

Since SHEIN suddenly emerged in 2020, the independent station track has become lively all of a sudden, with a large amount of capital and hot money pouring in. In addition, the role of independent stations as a "safe haven" has become more prominent after the Amazon account ban in 2021, which has triggered another wave of popularity. At that time, many sellers felt uneasy without an independent station. According to data released by the Ministry of Commerce recently, there are currently more than 200,000 independent stations in China.

The "China Cross-border E-commerce Financing Data List in Q1 2022" released by the China Internet Network Information Center shows that there were 15 financing events in China's cross-border e-commerce field in the first quarter of 2022, of which nearly half (6) were related to independent sites, including independent site brands (sellers) Wujiang Cross-border and Newme, as well as Xingpan Cross-border, FunPinPin, ShopBase, and Dianjiang, which provide website building services for independent site sellers.

The market share of independent sites in cross-border e-commerce has also risen. According to data released by market research firm eMarketer, the global cross-border e-commerce market size in 2020 was US$4.1 trillion, of which the market size of cross-border e-commerce independent sites was US$1.6 trillion, accounting for 39% of the cross-border e-commerce market. It is estimated that by 2025, the global cross-border e-commerce market size will reach US$6.5 trillion, and the market size of cross-border e-commerce independent sites will increase to US$3.3 trillion, accounting for 51% of the cross-border e-commerce market.

Internet giants such as ByteDance and Alibaba have quickly "locked" this trillion-dollar pie and have made many moves. ByteDance has successively laid out Fanno , DMONSTUDIO, If Yooou , and Alibaba has also launched allyLikes. However, the development of these projects is not ideal at present. Recently, Ennet found that the webpages of Fanno and allyLikes can no longer be opened. Although If Yooou can be opened, it is no longer possible to purchase any products.

Dmonstudio failed as early as the beginning of 2022. So far, all the independent station projects launched by Alibaba and ByteDance have failed. Most of these projects are benchmarked against SHEIN. At present, it seems that they have not been able to replicate SHEIN's successful experience. Do large companies really not have the genes to build independent stations? Why are the performance of many independent stations that sell well in cross-border e-commerce getting better and better? How can we build independent stations?

allyLikes and Fanno are shut down, and the website pages are no longer accessible

In 2021, Alibaba and ByteDance seemed to be competing with each other and launched allyLikes and Fanno respectively. Many people might not have expected that their endings would be surprisingly the same.

In October 2021, allyLikes entered the vision of cross-border people. With the huge halo of Alibaba, it quickly became the focus of attention in the industry. Previously, Alibaba had successfully launched the comprehensive cross-border e-commerce platform AliExpress, and acquired the two platforms Lazada and Daraz through investment and mergers and acquisitions, and has considerable experience in the field of cross-border e-commerce. Therefore, when allyLikes, which is benchmarked against SHEIN, was launched, people did not doubt its strength at all, but were more looking forward to it.

However, within two years, this project with inherent advantages came to an abrupt end. The following is the display of the allyLikes website.

Previously, allyLikes had accounts on Facebook, Instagram, YouTube, Pinterest, and TikTok, and had accumulated a considerable number of fans. In September last year, the total number of fans was nearly 470,000. Currently, updates on these social platforms have stopped, and fans have scattered. The latest video on YouTube was posted a year ago.

allyLikes' decline was already evident last year. In September last year, industry media reported that allyLikes' website traffic, daily active users and APP downloads had all dropped significantly, and the APP was suspected to have been removed from the Apple App Store. As the project had not made any progress, the team was also downsizing.

Data shows that allyLikes has been downloaded over 100,000 times on Google Play. Although it cannot be compared with giants like SHEIN (over 100 million downloads), it is not bad for an independent brand that has just been launched. Why was it shut down in the end?

Some answers may be found on the third-party independent review platform Trustpilot (equivalent to "Dianping" in China).

On the platform, allyLikes has accumulated 80 reviews in total, and received 1.5 stars, of which 79% of people gave 1 star, and only 14 people gave 5 stars. The overall evaluation is a clear word "Bad". They gave such evaluations because they encountered these problems: first, the quality of the goods is poor, sometimes even the goods are not the same as the pictures; second, the delivery speed is slow, showing that it will be delivered within two weeks, but some buyers received the goods in more than 20 days to 1 month; third, the customer service is poor. A buyer said that when he came to inquire about his order, he did not receive a reply for several weeks.

Fanno was launched a little later than allyLikes, but it also did not escape the curse of closure. A few days ago, Yien.com opened Fanno's website and found the following sentence on the page: "We regret to inform you that Fanno has ceased operations on June 10, 2023." At the same time, the Fanno team told consumers that if they have any questions or concerns about their orders, they can contact them via email.

From its launch in November 2021 to its closure in June this year, Fanno's life cycle was only one year and seven months.

At the end of 2020, Zhang Yiming mentioned in his internal goals that cross-border e-commerce is one of the three new business directions that ByteDance will focus on exploring in 2021. ByteDance thus started a cross-border e-commerce project codenamed "Magellan XYZ".

Fanno can be said to be the carrier of ByteDance's "dream of going global", but its performance is not satisfactory. Among the five countries where it has been deployed, only Italy has performed well, with the APP once reaching the third place among shopping applications, with excellent traffic and sales performance. However, its performance in the other four European countries is mediocre.

Therefore, ByteDance has already planned to "cut it off" just half a year old. In May 2022, news broke that Fanno was going to shut down, although it was later denied by the relevant person in charge, saying that it can still be used normally and will continue to support users and merchants.

But clues show that Fanno has become a "discarded child" of ByteDance: the app used to be updated several times a month, but the last update was a month ago; the official stopped advertising; sellers reported that the platform traffic has dropped significantly, and the number of orders has dropped precipitously; insiders revealed that most of its team had been disbanded in April. Not only that, sellers began to report in July that Fanno had stopped lending.

Interestingly, at the end of April 2022, TikTok had just launched a large-scale cross-border e-commerce business in four Southeast Asian countries (Thailand, Vietnam, Malaysia, and the Philippines). Now it seems that the team at that time was very likely to have moved to TikTok.

In the same year, TikTok Shop achieved a GMV of US$4.4 billion in Southeast Asia, more than four times the year-on-year. In 2023, TikTok Shop directly set a GMV target of US$12 billion in Southeast Asia.

Projects have failed one after another, and even giants can’t run independent sites?

Anyone with a discerning eye can see that the giants such as Alibaba and ByteDance have only one purpose in entering the independent station track: to create another SHEIN with a valuation of 100 billion US dollars. They have no shortage of experience, resources, or financial strength, and success seems to be a matter of course. Alibaba has three major platforms, Taobao, Alibaba International Station, and AliExpress, and has rich experience in going overseas and e-commerce operations, as well as a large number of supply chain resources. ByteDance has TikTok, a rising star in traffic.

But what is puzzling is that although these chosen ones have all failed in their independent website projects.

From November 2021 to March 2022, ByteDance successively dropped three heavy bombs in the field of cross-border e-commerce. In the same month when Fanno was launched, DMONSTUDIO, a fast-fashion women's clothing platform benchmarked against SHEIN, was quietly launched. But this platform fell much earlier than Fanno. From the registration of the domain name on November 03, 2021 to the cessation of operations on February 11, 2022, it survived for only more than 3 months (100 days).

In mid-March 2022, ByteDance launched IfYooou ( which was only exposed to the outside world in September), replacing DMONSTUDIO, and continued to explore fast fashion cross-border independent stations. However, Yien.com recently discovered that this project has also "failed". Although the website can still be opened, all products can no longer be purchased. When clicking to purchase a product, the page displays as follows:

ByteDance seems to have abandoned it even earlier than this. According to reports from peer media, IfYooou had stopped advertising as early as September last year, and its paid traffic was zero. Social media such as Facebook and Instagram also stopped updating in late August. In other words, when it entered the cross-border people's field of vision in September, it was already an abandoned project.

In this case, IfYooou's visits dropped sharply. According to SimilarWeb data, in August 2022, its total website visits were 177,000, but in September it dropped directly to 45,000, and in October it was only 5,007.

After IfYooou, ByteDance seemed to have given up on cross-border independent sites and never launched any other projects.

Now it seems that neither Alibaba nor ByteDance has taken over the independent website. This result is surprising, especially ByteDance, which has suffered three consecutive defeats with the traffic pool of TikTok. As we all know, traffic diversion is the "century problem" faced by independent websites. TikTok's monthly active users have already exceeded 1 billion, which is undoubtedly a strong support for ByteDance's independent website. However, judging from the current results, this traffic has not been successfully grafted onto the independent website.

Some people say: "ByteDance is a company that does not have the genes for cross-border e-commerce." Perhaps this is why its independent station projects have failed one after another, but this reason is obviously not applicable to Alibaba. It not only has sufficient overseas market data and mature brand incubation capabilities, but also has no shortage of supply chain resources.

But none of them could replicate SHEIN's success. Why? This question can perhaps be answered from the perspective of why SHEIN was successful.

First, SHEIN entered the market early, when traffic was very cheap, so its marketing expenses were very low, and advertising accounted for a small proportion of its revenue. Later, traffic costs gradually increased, especially after 2020, when cross-border e-commerce exploded, and traffic costs skyrocketed. If it were to follow SHEIN's model now, it would suffer heavy losses in traffic in the early stage.

The second is to deeply bind with the OEM factories and go deep into every link of the clothing industry from raw materials to finished products. This is the core barrier of SHEIN, and it took it several years to build it. Although the latecomers have the experience of their predecessors as a reference, it is not easy to do it. Especially the "small order fast return" model that people talk about with great relish, this model seems to have low barriers, but it is not easy to operate in practice.

SHEIN's moat seems narrow, but the actual imitation process is full of difficulties. Even the giants find it difficult to imitate it. What's more, in terms of resources, they have not effectively grafted these independent station projects, and many key links are almost started from scratch.

The domestic e-commerce market is mainly concentrated on the top platforms, while the situation in the foreign e-commerce market is completely different. Although the penetration rate of e-commerce in Europe and the United States is increasing rapidly, a relatively centralized e-commerce platform has not yet been formed. For example, in the United States, Amazon, Walmart, and eBay only occupy about 50% of the market share, and the remaining 50% is in the hands of independent websites of various brands. Therefore, independent websites have a natural soil in overseas markets.

This is also the reason why Alibaba did not withdraw from this track after the failure of the allyLikes project, but turned around and provided independent station building services. In September 2022, its independent station digital solution OKKI was officially released. In addition to providing independent station building services, OKKI also covers two dimensions: OKKI website building and OKKI marketing. The business coverage includes "marketing acquisition", "customer conversion", "delivery fulfillment", and "compliant operation".

Is it still possible to set up an independent website if it is so unfriendly?

Some people may ask, if even the giants can't build an independent website, can we still do it? Yes, but it's very difficult.

According to data released by market research firm eMarketer, the global cross-border e-commerce market size was $4.1 trillion in 2020, of which the market size of cross-border e-commerce independent sites was $1.6 trillion, accounting for 39% of the cross-border e-commerce market. It is expected that by 2025, the global cross-border e-commerce market size will reach $6.5 trillion, and the market size of cross-border e-commerce independent sites will increase to $3.3 trillion, accounting for 51% of the cross-border e-commerce market.

The advantage of an independent website is that it can accumulate its own users, communicate directly with users through continuous repeated marketing and cross-selling, continuously optimize products and polish the brand, and has fewer rules.

In addition, third-party platforms can no longer meet the long-term growth of brands. Many cross-border e-commerce sellers are slowly trying to develop independent station businesses while laying out platforms. The financial report shows that independent stations are a new channel that Anker Innovations has focused on investing in in the past two years. In 2022, its six independent stations (Anker/eufy/soundcore/Nebula/AnkerMake/AnkerWork) achieved a total revenue of 676 million yuan, a year-on-year increase of 71.75%; the proportion of independent station channel revenue increased to 4.75%, an increase of 1.62% from last year.

From local governments to the national level, a series of policies have been introduced to support and encourage the development of cross-border e-commerce and brands to build their own independent websites. For example , in March this year, Hunan issued a document to encourage companies to build their own cross-border e-commerce independent websites, and gave 200,000 yuan and 1 million yuan rewards to companies whose annual cross-border e-commerce transaction volume reached 100 million yuan and 1 billion yuan for the first time, respectively. Shenzhen, where cross-border e-commerce companies gather, also encouraged companies to develop independent websites after the Amazon account ban wave broke out, and at the same time gave 2 million yuan in subsidies to qualified companies.

There is no doubt that independent sites are a major trend, but it is not easy to build an independent site.

Independent website is a "money-burning" business. Where does the money go? A large part of it is spent on traffic. In the past, CPC traffic might only cost a few cents, but now it has risen to about $1.

Independent sites do not have a natural traffic pool like platforms. Everything must be obtained from the outside. Only when a large enough traffic pool is accumulated can we talk about subsequent repeat purchases (natural traffic), and the early traffic can only be purchased with payment.

It is not difficult to find out from observing the development of independent websites that the popularity of independent websites is accompanied by the emergence of new traffic channels. For example, during the first popularity (2002 to 2015), search engines emerged; during the second popularity (starting in 2016), the traffic dividend of social media and the website building tool Shopify emerged. It can be seen how strong the role of traffic in promoting independent websites is.

Therefore, to build an independent website, the financial strength must not be weak. Moreover, brand independent website is a long-term process, and it is difficult to see cash flow immediately.

Such a long-term and huge investment is difficult to bear even if it has already hit the top sales. In the first half of 2021, the revenue of Youkeshu's independent station dropped sharply. In the financial report, Tianze Information stated that the independent station business requires a large amount of advertising and marketing expenses in the early stage. Under the pessimistic financing situation of listed companies, Youkeshu does not fully have the conditions to continue to carry out the independent station business in the short term.

In addition, a senior cross-border e-commerce insider once said: "For an independent website without supply chain support, any front-end romance is just a castle in the air."

One of the secrets of SHEIN's success lies in its strong supply chain, which enables it to launch new products at an extremely fast speed, meet consumers' ever-changing product demands, and naturally gain more market share.

At the same time, it should be noted that the independent station supply chain involves many entities, requiring collaboration from all parties.

Since it is so difficult to build an independent website, even giants or top sellers may not be able to do it well, so are small and medium-sized sellers even less likely to succeed? In fact, when building an independent website, giants tend to copy the models and successful experiences of their predecessors. However, going overseas sometimes requires the right time, right place, and right people, and the experience applied may not be in line with the development of the enterprise itself and the needs of the market. However, small and medium-sized sellers are much more flexible and understand the market better.

Fanno

allyLikes

If

Yooou