The “Double Eleven” report card is still closely watched by investors. Growth in some consumer categories developed earlier may be close to saturation, and future growth may lie in new consumer categories.
The Zhitong Finance App learned that Guolian Securities released a research report saying that although the gradual decline in the Internet dividend period has made “online shopping” no longer fresh, and the rise of new business formats such as live e-commerce has also brought “low price promotions” into the daily lives of more consumers, as one of the most iconic activities in the domestic consumer sector in the past ten years, the “Double Eleven” report card still received close attention from investors. Growth in some consumer categories developed earlier may be close to saturation, and future growth may lie in new consumer categories.
The main views of Guolian Securities are as follows:
Overall performance: sales growth has slowed, with highlights in “new business formats” and “new consumption”
In the “Double Eleven” promotion in 2023, the cumulative sales volume of the entire network was 1138.6 billion yuan, a year-on-year growth rate of 2.08%, continuing the downward trend in growth since 2020. Looking at the business format, the year-on-year growth rate of integrated e-commerce represented by Tmall, JD, and Pinduoduo has turned negative. The growth rate of live e-commerce represented by Douyin and Kuaishou has also slowed down compared to last year, but the growth momentum is still there. In terms of market share, the market share of live e-commerce reached 18.9% in 2023, up 2.6% from 2022, gradually seizing the market share of integrated e-commerce. By category, pet consumption, sports, outdoor sports, etc. are growing at the highest rates. From the perspective of category GMV, the lower the overall GMV, the higher the growth rate of the category, or it may indicate that future e-commerce platform sales growth will drive new consumption represented by pet food.
Promotion policy: Under the strengthening of games, e-commerce platforms accelerate “internal volume” and increase discounts
In the context of slowing sales growth, e-commerce platforms have generally strengthened preferential mechanisms and increased discounts. Judging from the preferential mechanism, most platforms have relaxed the “full reduction” conditions while reducing restrictions. Take Pinduoduo as an example. The new “single item discount” gameplay changes Douyin's cross-store full reduction to an official 15% discount, combined with consumer vouchers, up to 300 minus 80. Judging from the strength of discounts, the actual discount strength of most platforms continues to increase. Based on the upper limit of actual discount strength, the actual discount ratio of JD, Douyin, and Kuaishou fell below 80% for the first time.
Category performance: Competition in some categories has intensified, and the “rise of domestic goods” is still on the way
On the one hand, judging from the concentration of leaders, the concentration of most categories is not high, and competition is still intensifying. Taking Tmall and JD as examples, CR3 for major consumer categories was generally below 10% in 2023, CR5 was generally below 15%, and compared to 2022, the leading concentration of sales in most categories declined marginally in 2023, showing a trend of increased competition. This trend can also be seen from the changes in the number of top ten brands in each category every year. In fact, the “turnover rate” of the top ten brands in most categories has increased in the past ten or two years, such as women's clothing, men's clothing, household cleaning, food, and small household appliances. In the context of slowing sales growth, brand competition may enter the “Red Sea.” On the other hand, judging from the share of domestic goods in the top ten sales, although the share of domestic goods in the top ten personal goods is currently low overall, especially beauty, luggage, sports, outdoor sports, etc., which have certain brand premiums, domestic brands of home appliances (including major appliances and small household appliances) and home textiles account for relatively high sales, and is still rising.
Summary: Highlights and hidden concerns of this year's “Double Eleven”
The marginal decline in popularity of “Double Eleven” has been affected by many factors, but starting from this year's report card data, we can still grasp the structural highlights and hidden concerns. Growth in some consumer categories developed earlier may be close to saturation, and future growth may lie in new consumer categories. Examining the three dimensions of sales growth rate, concentration, and domestic goods share, it can be seen from the main consumer categories: 1) The sales growth rate of most categories has fallen to a negative range, but some new consumer categories have maintained a high growth rate, such as pet food; 2) the top concentration of most categories is still low, yet the impact of new brands is still strong. In the context of the decline in the overall growth rate of “Double Eleven”, competition in some categories has entered the “Red Sea”; 3) Judging from the top ten domestic brands, it is difficult to say that some categories are still optimistic. In particular, there are certain brands that have premium beauty, luggage, sports and outdoor categories, etc., domestic brands The influence still needs to increase; however, some new consumer categories, such as pet food, have increased or become “new domestic goods forces”; furthermore, the absolute share of home appliances and home textiles is already high.
Risk warning
1) Third party data omissions or errors; 2) Consumption and Internet policy adjustments.