In addition to the low-price internal competition, some people are experiencing a period of explosive sales. “Many platforms sell shoes with the same style as ours, but with poor materials and workmanship. Consumers only see the lower price, which forces us to offer low prices.” A few years ago, Ruibao, which started out in the “shoe capital” of Jinjiang, decided to go overseas to escape its low-price internal competition.
In August 2023, Ruibao entered the TikTok Shop full-hosting market and quickly opened up the US market with its differentiated "dopamine" colored flying woven shoes, with a customer unit price of US$12-16, which is considered a medium-to-high customer unit among products of the same level in its category. In just half a year, Ruibao's GMV has achieved exponential growth, from an average daily price of less than US$2,000 in January 2024 to an average daily price of US$52,000 in August.
"It's hard to imagine that TikTok Shop has accounted for half of our online sales in such a short time," said Li Hanxiao, the product manager of Ruibao TikTok Shop. He still remembers that in the early days of joining the platform, he cooperated with influencers and brought in $10,000 in sales for his first short video , and created $160,000 in GMV by cooperating with an influencer with less than 10,000 fans.
( TikTok influencers use short videos to promote Ruibao)
This made him see the explosive power of product sales stimulated by content e-commerce. At present, Ruibao's monthly sales have reached a maximum of 120,000 pairs, which is the total sales of other similar products. Among them, nearly 90% of the sales are driven by short videos, and the GMV of the content field accounts for 60%.
Ruibao’s story is just a microcosm of TikTok Shop’s fully managed merchants.
In China, a large number of merchants that have mature supply chain systems but suffer from the saturation of the domestic market and little premium space have taken the first step by relying on TikTok Shop's full hosting, and have moved towards explosive sales through content e-commerce, while also gaining more profit margins.
Reject price wars and break through high customer price
The past two years of rapid development of full-hosting services have also been a critical period for businesses to accelerate their overseas expansion.
The first impression of most merchants on going overseas is that it is indeed not as competitive as in China. "Especially European and American customers are not that sensitive to prices. Of course, there are some customers who are relatively sensitive, but it is far from the stage where they really want to sell at low prices."
Consumers’ insensitivity does not mean that cross-border e-commerce platforms have no tendency to offer low prices. Even overseas, most shelf e-commerce platforms are mainly oriented towards price to establish competitive advantages, which means that merchants participating in full trusteeship can only earn a “small profit but quick turnover”.
To some extent, cross-border e-commerce is experiencing a rapid transformation. Although there are still opportunities in the overseas market, the competition is more intense. On the one hand, the merchants who first achieved results by relying on prices have realized that low prices are not a long-term solution and have begun to seek a normal return to commodity prices; on the other hand, consumers in overseas markets have a stronger willingness to pay for special and quality goods, allowing merchants to get out of the "low-price spiral" and have reliable demand support.
The company mainly deals in walkie-talkies and has entered the cross-border e-commerce field since 2007. However, in recent years it has increasingly felt the severe homogeneous competition.
"There are too many similar products on the market, resulting in fierce price competition. We have no choice but to invest a lot of money in advertising, but the conversion rate is still very low, and we cannot bring about the expected customer growth." For a mature merchant who has been deeply involved in cross-border e-commerce for 17 years, this has become the biggest pain point for Jiajianchengci to break through the market bottleneck overseas.
MAANGE is in the same situation as Jiajianchengchu . This company is facing not only homogeneous competition, but also the increase of various operating costs.
MAANGE was initially a manufacturer that focused on 1688, mainly supplying cross-border merchants. Later, it decided to go into business on its own. During the best years for the market, it once ranked first in the makeup brush category on a certain cross-border e-commerce platform.
However, in recent years, operating costs have continued to rise, and the increase in imitation products on the market has put a certain squeeze on profits.
The mature big sellers feel that the competition is becoming more and more fierce. On the other hand, more and more small and medium-sized businesses are pouring into the overseas market. These small and medium-sized businesses also feel that it is not easy. They believe that the popular categories of some shelf e-commerce platforms are currently controlled by the top merchants, and they urgently need to find new incremental opportunities in the cross-border e-commerce market, which is gradually becoming a red ocean.
"Many categories have been monopolized, and the competition among merchants is fierce. It has become a red ocean market." He Penghui, founder of Yiwu Yongge Trading Co., Ltd., started cross-border e-commerce five years ago. Recently, he has been feeling increasingly exhausted. What is weighing on him is the ever-increasing logistics costs, warehousing costs and advertising costs, and his input-output ratio is getting lower and lower.
All of these ultimately point to one result: most overseas shelf e-commerce platforms have begun to lower prices, and the more they lower, the less profit they make. Relevant data shows that in 2023, 59% of sellers said their profits had declined.
The era of pursuing small profits but quick turnover is becoming a thing of the past. Merchants are in urgent need of a new blue ocean market to break out of the low-price cycle and increase their profit margins by selling products with high unit prices.
A high average order value means that the product must be attractive and make consumers feel that it is novel, interesting, and worth trying. It also means a different marketing approach from the past, requiring the use of interesting content to attract consumers and inspire them to buy.
Just like Ruibao, different from only supplying basic black and white colors on other platforms, it launched a variety of "dopamine" color flying knit shoes on TikTok Shop, which can be sold at a higher price; Jiajianchengci launched more functional walkie-talkie products on TikTok Shop, using short video content to attract consumers' attention and conversion; MAANGE's products on TikTok Shop have been constantly upgraded, and the average customer price has increased from US$6 to more than US$20, and it can still continue to receive orders after the price increase.
(Ruibao Feiweaving Shoes)
As cross-border e-commerce is gradually becoming a red ocean, a group of merchants have found a successful path to sell high-priced products through content e-commerce. Content triggered sales, 1 short video sold 2,000 units Fully managed merchants have realized the importance of content in promoting product success, and have realized that the power of TikTok is far greater than imagined: a short video can accumulate a large amount of traffic in a very short period of time, gather a group of people with high purchasing intention who are interested in the product, and then revitalize and drive a store to success. A fragrance brand once sold more than 2,000 perfumes in one day because of a beauty expert's unboxing and review short video . Its marketing manager told us that these Internet celebrities are very interesting. "When they think your content and products are good, they will spontaneously promote your content. Every month, these unaffiliated 'tap water' pure wild experts can bring thousands of sales. "
This is the magic of content e-commerce.
Whether at home or abroad, almost all consumers need real user experience and demand resonance when making purchasing decisions, which to some extent has become a rigid demand.
In the United States, TikTok has revolutionized the way Generation Z discovers products. Recent research results from HerCampus show that 74% of Generation Z users use TikTok to search for products, and more than half of them prefer TikTok to traditional search engines such as Google.
TikTok has also changed the way users consume. A doctoral student at the University of Michigan found in her research on the impact of advertising and social media on young people that "when advertising information is combined with pleasant, beneficial and interesting content, it will stimulate consumers' emotional response to advertising information, and this response occurs more unconsciously and subconsciously." She also found that this affects users' decisions when clicking the purchase button, greatly reducing the resistance of users when placing orders.
Therefore, it has become a global trend to buy useful and interesting content and follow influencers and anchors to buy things. In the past year, the GMV of TikTok Shop content market has increased by 557%.
He Penghui, founder of Yiwu Yongge Trading Co., Ltd., seized the dividends of content e-commerce and achieved rapid development. In October last year, He Penghui began to develop TikTok Shop, selling wearable blankets with a customer unit price of 20 to 30 US dollars, and participated in the new product cold start special project in the early stage of entry, obtaining platform traffic, subsidies and resource tilt.
(Yong Ge wearing blanket)
After completing the basic sales promotion, the investment buyers helped to register for the product selection meeting. As a result, Yongge's wearable blanket products were selected by a domestic MCN agency. In addition, with the platform's traffic support during Black Friday, the first live broadcast generated a small explosion of orders. Subsequently, more influencers and MCN agencies continued to shoot short videos and live broadcasts, further generating continuous explosions of orders.
In the future, Yongge plans to continue to develop TikTok Shop and start to develop short video content creation and launch live broadcast rooms in the U.S. The reason is that content e-commerce gives people a sense of "self-control."
He Penghui pays attention to the backend sales and conversion data every day. " If I see that the sales of a certain link are declining, I will frantically pull short videos or some live broadcast resources, so that the sales can be increased immediately . When the sales of the link are stable, I will pause for a while; if it declines again, I will pull it again. " This makes him feel at ease, as he always felt "powerless" when sales of products on other platforms declined.
In order to achieve this sense of "control", some fully managed merchants have even started to produce their own short videos and actively establish connections with experts.
In the past, after MAANGE products were launched, TikTok Shop buyers were responsible for operation and promotion, and it took about two months to make a product popular. After seeing the explosive power of content, MAANGE chose to build its own domestic MCN agency in May this year, produce short videos by itself, and actively invest in traffic to accelerate promotion. In this way, the product's explosive cycle was greatly shortened, and basically it could be sold out as soon as it was launched, and at its peak, it could reach thousands of orders a day.
（ MAANGE makeup brush ）
Users of shelf e-commerce are highly purposeful, and their consumption decision-making logic is "demand-search-transaction". Whether a product can be sold after it is sent depends entirely on the price and platform traffic. When sales decline, there is very little that merchants can do.
Compared with shelf e-commerce, users of content e-commerce first become interested in content and then have a desire to buy. The consumption decision-making logic is "content-reach-transaction". This stimulation logic allows TikTok Shop to cover the entire user life cycle of planting grass-marketing-conversion, and also gives merchants more subjective initiative. They can reactivate product links when traffic declines and increase sales by linking with influencers, releasing short videos and live broadcasts.
Create new volume, no longer blindly groping in the dark In the past two years, cross-border e-commerce platforms have been using a full-hosting model to snatch merchants from industrial belts, directly connecting with factories and overseas consumers.
In February this year , TikTok Shop cross-border e-commerce officially launched the "Industry Belt 100" plan, planning to enter more than 100 industrial belts by 2024 and help merchants create more than 10,000 global best-selling products. At present, the "Industry Belt 100" plan has entered more than 80 industrial belts and is still ongoing.
Most merchants in the industry belts that have entered the fully managed business have a lack of knowledge about overseas markets and consumers. How to capture overseas consumer demand more accurately and timely has become a major pain point.
Even mature sellers will go through a period of adjustment and adaptation when entering a completely new market.
When the fragrance brand we mentioned above entered the UK and US markets in a fully managed model, it brought popular products from other markets, but later found that British and American users prefer high-end products and high-end fragrances. Fortunately, many users communicated their preferences directly with the anchor in the live broadcast room, and the influencers could provide feedback on more localized needs at any time, so the fragrance brand promptly developed a batch of new products designed specifically for the UK and US markets, which led to the subsequent explosion.
"British and American influencers use perfume more frequently, are very professional in perfume, and know better what kind of smells their own people prefer, so they can really give us a lot of good ideas." Its marketing director said that the brand hopes to follow the expansion of TikTok Shop to make a global layout. It is difficult to understand the preferences of each country and each race for perfume by itself. By communicating with influencers, timely adjustments can be made to meet local market needs. At present, the fragrance brand has formed a basic production model of influencer communication-sample-test-promotion.
The company's new product development inspiration comes in part from short video users. Its founder believes that compared to traditional shelf e-commerce platforms where only comments can be left and it is difficult to contact customers directly, short videos can more intuitively communicate with customers about their functional needs and pain points, and upgrade the software based on the needs of TikTok Shop players.
On the other hand, TikTok Shop can also provide merchants with certain data insights and guidance to help them sell products that meet consumer trends. For example, MAANGE's road to product success was precisely due to the advice of the investment buyers on the combination of "hot items + hot items".
" The investment buyers will tell us which products are selling well and which price ranges are selling well. Then we will combine new models based on this. " MAANGE Wu Xuying told us that, for example, makeup brushes and powder puffs can be combined into a set to create a new hot-selling product with a higher average order value, and 20,000 to 30,000 sets can be sold every month.
（ MAANGE makeup brush ）
In addition, the exponential growth in production demand when orders surge has always been a huge test for cross-border merchants in their business operations.
In order to better prepare for the explosive orders, Lingfeng, a women's clothing merchant that once created million-dollar hot-selling products, expanded the scale of outsourced factories, upgraded factory management, and formulated a reasonable return rhythm under the promotion and guidance of the TikTok Shop platform. It was able to quickly adjust its stocking strategy, ensure sufficient supply of products, and effectively respond to the high market demand.
With full hosting in TikTok Shop, on the one hand, the platform's data analysis and direct feedback from influencers and consumers allow merchants to capture market changes in a timely manner; on the other hand, content constantly drives more products to stand out from the traffic pool and continuously creates consumption scenarios for users. With the support of both, merchants can not only gain incremental growth in the short term, but also achieve sustainable operations in the long term.
" The content e-commerce brought by TikTok Shop is still in the blue ocean stage. It can help merchants quickly establish consumers' psychological cognition and achieve overtaking through influencer promotion and live streaming. " This is the biggest feeling of many merchants since entering TikTok Shop.
Foreign media have tracked and counted the sales of a vitamin D3+K2 supplement brand for nearly a year. They found that after the brand's product videos continued to go viral on TikTok this year, in addition to driving a surge in sales on TikTok Shop, Amazon's sales each month were 4-5 times higher than last year's sales, and its overall market share also rose to first place.
In this way, it is not difficult to understand why many merchants gradually shifted their operational focus to TikTok, and then covered other cross-border e-commerce platforms with TikTok Shop as the center. They believe that now is the best time to enter and develop TikTok Shop.
TikTok Fully managed Low price roll-in | 
