What will happen in 2024? Here’s what the cross-border leaders say

2023 has passed. In this year, some people made a fortune from booming orders, while others tightened their belts. No matter how sellers did last year, 2024 is another new beginning.

In the past year, the cross-border e-commerce industry has experienced ups and downs. The market is becoming more and more competitive, and sellers' profits are generally declining. New platforms are emerging, and each platform is stepping up its efforts to attract offline merchants. Should we join the game or not? This is a question.

Many sellers will set their New Year's plans at the beginning of the year. Should they maintain their existing business or actively expand? Should they build new platforms? The answer is different for every seller.

“A speck of dust from the times weighs on a person’s head like a mountain.” In order to seize more opportunities and avoid being eliminated by the market, it is crucial to have insight into market movements and trends.

In order to grasp the direction of the tide, Yienjun invited several big names in the cross-border e-commerce industry to share their views on industry trends.

Let’s hear what the big guys have to say.

About "Involution"

One of the themes of cross-border e-commerce in 2023 is "competition". Sellers compete, platforms compete, service providers compete, and everyone is squeezed and uncomfortable, but everyone wants to be the king of competition.

In the new year, should we continue to roll? How should we roll?

Chen Wenping, Chairman of SDIC

As for the question of "squeezing", it depends on the platform. Our main platform is Amazon, which is not squeezing in 2024. The premise is to operate in compliance with regulations and not skirt Amazon's rules.

Brand companies going overseas that operate in compliance with regulations will feel better and better and will not be squeezed, because the situation of bad money driving out good money will become less and less common.

Sun Yutao, Chairman of Oushuitong

For sellers, the next suggestion is definitely to develop a multi-platform layout. We mainly serve Amazon sellers. Amazon sellers may not be able to do Temu and Shein, but they can definitely open an additional TikTok Shop and combine the two platforms.

For service providers, all of them will gradually become the top ones. Because customers want more than just price, they also need stable services, a strong team, and a strong background to achieve excellent service quality. In the future, the top effect of service providers will become stronger and stronger.

CEO of a leading service provider

We generally have two major directions. The first is to see if there are new opportunities in the industry. The second is to deepen the vertical track and become the industry leader.

Many Amazon service providers face a problem: it is difficult to expand new customers. However, new platforms such as Temu and TikTok Shop have many new customers, so they can seize new opportunities. At the same time, they can also rely on their own delivery capabilities to grasp high-quality customers in the market and pursue long-term and stable development.

Our approach is to combine our own genes to find sectors that can be deeply cultivated. If you are a steady and cautious type, you can dig deeper in your own field. As the industry becomes more "volume", you can choose the right "volume" method.

Zhou Kang, founder and CEO of Chengzhe Technology

1. Low-end supply chain products should remain in a state of involution, with no signs of reversal in the short term. Whether it is the enhancement of platform discourse power or the transfer of low-end supply chains, it will lead to the continued involution of low-end supply chain products;

2. In addition to market factors, new energy storage-related products are also affected by certain policy factors, so it remains to be seen;

3. "High-quality development" is the direction that the country encourages, and this policy is also reflected in the export market, so products that are innovative and competitive in the international market still have a relatively large opportunity. Only with certain leading innovations can we avoid the situation of being out of the game.

Founder of a leading 3C ODM company

Our definition is to make products, not to sell them in large quantities. The profits of traders are getting lower, and we are more optimistic about the direction of mid-to-high-end brands. As long as we firmly follow our own path, there is no such thing as volume or no volume.

Mid- to high-end products require core control over the supply chain, from brand, channel to R&D and production. If any one link is mismatched, problems will arise. Low-priced products have a higher market tolerance rate, and customers can accept the advantages and disadvantages of the product, so the probability of problems is relatively small.

About New Business

2023 is a turning point for cross-border e-commerce, heralding a more in-depth development of cross-border e-commerce.

Over the years, cross-border e-commerce has developed a set of excellent operational capabilities, and the supporting e-commerce service facilities are gradually becoming more sophisticated and the level is gradually improving. Going overseas has become a major trend, and many people believe that "if you don't go overseas, you're out of the game." Cross-border e-commerce used to be a niche industry, but now the trend of "everyone going overseas" is getting stronger and stronger.

Big Internet companies are all doing overseas e-commerce, including Temu, Shein, TikTok Shop, AliExpress, 1688... New cross-border platforms and cross-border businesses are being launched one after another, and the entire cross-border ecosystem is being reshaped.

Domestic consumer brands are also going overseas, and the momentum of “brands going overseas” is growing stronger.

What efforts can we make in the face of new changes in the industry ecology?

Chen Yong, founder of Sevens Marketing Consulting

I think cross-border e-commerce is still an industry with great growth opportunities. It will undergo some changes, such as the transformation from relying on the dividends of third-party e-commerce platforms to branding. I think TikTok Shop is a big variable, bringing new traffic dividend opportunities.

In addition, we have seen that many high-quality ODM factories with design and R&D capabilities have begun to enter the cross-border e-commerce market, and domestic consumer brands have begun to go overseas, so the entire industry is growing rapidly.

Service providers will become more and more segmented and professional. Take TikTok as an example. The new platform has brought in a lot of new service providers. There are more and more participants, and the professional division of labor is more detailed.

I personally think that as a seller rather than a brand owner, you can actively embrace TikTok Shop. It is an incremental market with room for several times growth in the future. Competition in many categories is not fierce, and the gameplay is not "competitive", so there is a chance to reap the dividends of the category. Temu is more suitable for factory-type sellers to supply goods, but may not be suitable for most sellers.

Fastmoss founder Shi Wenlu

The cross-border e-commerce industry will enter a 2.0 stage. Short videos and live broadcasts are on the rise globally, bringing a huge traffic pool; domestic e-commerce platforms and new consumer brands are also going global on a large scale. It is foreseeable that we will usher in a larger wave of going global. This time, there will be more participants and more brands going global than before. I believe that cross-border e-commerce will have a high-quality development stage in the future.

TikTok is already relatively mature in Southeast Asia. We predict that around July this year, the daily GMV of TikTok Shop in Southeast Asia will reach $100 million. The United States also has huge growth potential. After the beginning of this spring, TikTok's mall and live broadcast in the United States will achieve larger-scale development. TikTok Shop is likely to open sites in Brazil and many European countries this year, so I think this year will be the year of TikTok Shop's explosion.

The service provider ecosystem around TikTok will also grow, with more and more MCN agencies, agency operators, advertising service providers, and data service providers. There are also many new tools, such as MossCreator, a platform for building connections with TikTok influencers.

Therefore, I believe that the marketing service provider ecosystem will be segmented in the future: there will be more service providers of the same type and they will be more "competitive". Service providers of China's Tik Tok and Kuaishou are also going overseas on a large scale, and local service providers from Southeast Asia and the United States are also rising rapidly.

An executive of Lege Overseas Warehouse

We think that cross-border e-commerce is moving from a new format to a new normal, one of which is refinement in the subdivided fields, and the other is branding and customization. So in the next two years, I think traditional foreign trade factory sellers and people with many years of foreign trade experience will have the opportunity to carve out their own niche in the cross-border field.

Of course, the theme of "Volume" in 2023 will continue this year. How to occupy market share and allow companies to obtain sufficient profit margins will be the topics that will be focused on next.

There was a wave of overseas warehouse boom in 2020. After the wave passed, the overseas warehouse companies that remained in the market were growing rapidly, both in scale and number of customers.

I think there will be two trends in overseas warehouses in the future. One is that warehouses will become larger and larger, and the other is to move towards customized services. Large warehouses can reduce unit cost and energy efficiency, and improve the stability and fault tolerance of warehouse explosions. For refined requirements, small warehouses will appear to meet customers' differentiated and customized needs, with higher flexibility.

Our mindset is to move in a long-term direction and work hard with the sellers. This is the most realistic thing.

Conclusion

Yi Enjun believes that "volume" is inevitable, but in an environment of internal volume, it is even more important to find your own advantages. Polishing your advantages to the extreme will help you develop better in the long run. Of course, looking for new opportunities horizontally is also a way.

Opportunities always come to those who are prepared. It is foreseeable that the scale of cross-border e-commerce will become bigger and bigger. The bigger the storm, the more expensive the fish will be. As long as you have real strength and find the right opportunity, you can make a name for yourself in this environment of internal competition!