Global Perspectives

In China, Private Domain Traffic Brings “New Future” to New Brands

Since 2020, there have been two words in the marketing circle that have remained hot. The first is “live broadcast”, and the second is “private domain traffic.”

 

In China, brands like Perfect Diary and Nyusi Mystery have achieved rapid revenue growth with the help of private domain operations such as live broadcasts and WeChat groups. At the same time, many brand-new Chinese brands have carried out the layout of private domain traffic right from the start.

 

For example, the low-alcohol liqueur brand Mary Shelley has operated its own community, promoted its membership system, and established its own private domain traffic pool since the beginning of its establishment.
 

What is the value of private domain traffic to the brand?

 

The core of private domain traffic lies in mastering the real user relationship. It solves the biggest pain point in the development of the Internet—the problem of “connection.”It provides a brand-new way of thinking for brands: a deeper connection to old users, from traffic harvesting to user management.

 

For brands, building private domain traffic can not only effectively reduce marketing costs and increase repurchase rates, but also drive fans and members to actively share and spread. Operating private domain traffic well is not only the maintenance of existing users, but also the reach and operation of potential customers. Private domain traffic is the digital asset of a corporate brand, which plays an important role in enhancing the economic benefits of the brand.

 

During the Youzan, the largest provider of WeChat stores in mainland China, Nov. 2020 ecological conference, Youzan CEO Bai Ya proposed the three most critical indicators of private domain economic operation capabilities:

  • The first is the power of private domain property. This is the number of connected customers and the ability of enterprise information to reach customers;
  • The second is the single customer value. This is the total value of a single customer’s entire life cycle and the customer’s repeat purchase rate;
  • The third is the customer recommendation rate. This is the ability to expand new capabilities through the recommendation of old customers and the influence on customers in the related field.

 

At the end of December 2020, Youzan organized a marketing campaign called the Private Domain E-commerce Festival. The event brought dazzling results with fission marketing driving 500,000 people to participate, of which 100,000 were spending the first time in the WeChat ecosystem, and new visitors’ first orders reached more than 200 yuan.

 

Private domain operations and social marketing also brought higher unit prices. The unit price of digital categories exceeded 5,000 yuan. The jewelry category exceeded 40,000 yuan, and the unit price of the women’s clothing category exceeded 1,000 yuan.

 

Among the merchants participating in this “Private Domain E-Commerce Festival”, there are many leading brands from all walks of life. Facing the dilemma of diminishing traffic dividends, they tried various ways to pull new listings and repurchase, and explore the gameplay of “private domain traffic”.

 

As a leading enterprise in the casual snacks field, in 2012, when many retailers were still hesitating to open up e-commerce channels, “Bianpin Store” was already involved in it, and took advantage of the e-commerce traffic dividend in 2013 to get an explosion Type growth.

 

With the increase in traffic costs, BESTORE considered the layout of data privatization

 

In 2014, Chinese snack brand BESTORE joined Youzan and began to try to communicate with consumers through distribution and group games. During the Private Domain Festival, BESTORE established a private domain traffic mining mechanism centered on its “salesman” layout.

 

 

 

Bestore at New York Times Square (PRNewsFoto/Liangpinpuzi (LPPZ))

 

 

BESTORE launched the “Salesperson Maker Program,” which adopts the whole-store commission promotion + single-product hot-selling promotion incentive system, and at the same time, divides the level of salespersons and gives TOP salespersons additional incentives through the form of motivating rankings.

 

BESTORE also provides training support for salespeople at different growth stages, plans monthly goals for salespeople, and formulates a salesperson growth mechanism to train senior salespeople in a progressive manner according to the sales amount.

 

In addition to the incentive mechanism, BESTORE  has also established a corresponding “elimination mechanism.” They use weekly frequency, comprehensive evaluation based on the dimensions of working time, monthly turnover, frequency of entering the store, etc., to eliminate the fittest and ensure the stability of the sales team’s ability.

 

The success of ilollipop

 

In addition to BESTORE, China’s high-end maternity and baby chain brand ilollipop also seized the trend of private domain traffic and began to deploy an online ecology. After launching Youzan at the end of 2019, ilollipop expanded its online category through Youzan Mall, selecting products of the same category, cost-effective, and high-end brands, and putting the products on Youzan Mall for sale.

 

At present, the number of brands that ilollipop cooperates with has expanded from 350 offline to nearly 600, and sales through the expansion of the Youzan distribution market have increased by 30-35 percent.

 

At the same time, ilollipop also set up a complete shopping guide distribution system. Ilollipop’s headquarters has dedicated personnel to output content to help improve the efficiency of shopping guides and, in addition to the commissions that can be obtained for online distribution, all the sales generated by the individual shopping guides in the micro-mall are counted as the entry store—which is counted as the personal performance achievement rate.

 

Under the incentive of double commission, the motivation for the online shopping guides to maintain members and distribution has increased.

 

Currently, ilollipop operates 180,000 members, and member consumption accounts for more than 85% of the total performance. The average monthly sales reaches 3 million yuan, and the turnover in 2020 is close to 30 million yuan.

 

Will private domain traffic be the future of marketing?

 

From the above cases, we can see that private domain traffic can not only help brands refresh, increase transaction conversion rate and traffic usage efficiency, but also dig deeper into user value through refined operations on regular customers, and improve user transactions in the life cycle frequency.

 

In addition, in terms of distribution management, private domain traffic can assist in managing KOC customers, build connections with users through multiple channels, cultivate user loyalty through private domains, and increase user stickiness.

 

Not only that, in terms of brand communication, private domain traffic can also help brands avoid risks and reduce reliance on third-party public domain platforms.

 

Will private domain traffic be the future of marketing? The answer may be yes. The evolution of history has always been the process of efficient organizations combating inefficient organizations. At a time when user attention is increasingly being divided by major apps, private domains can help brands build more vertical, efficient, and sticky customer acquisition channels.

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