Some time ago, TikTok finally gained a foothold, but the veteran player Amazon did not make any moves.
I thought that Amazon was as stable as Mount Tai, but I didn't expect it to panic a batch.
Recently, in the face of Pinduoduo's Temu and Shein's low-price offensive, Amazon had to bow its head and make profits.
In this way, Amazon is also panicking in the face of the "ultimate cost performance" of Chinese e-commerce
Amazon is in a hurry
On December 5, Amazon announced that the commission rate of clothing products priced below $15 was reduced to 5%;* The commission rate for clothing products between $15 and $20 is reduced to 10%.
You know, the commission ratio of these two types of products was 17% before, why did Amazon start to drastically reduce the commission ratio?
This is not because Pinduoduo is too rolly, and in the face of the low-price onslaught of its Temu and Shein, Amazon is also forced to be in a hurry. Previously, Amazon rarely lowered the percentage of commissions it charges merchants.
The change in the commission ratio involves sellers who provide low-priced clothing products.
Lucas Barnes, a former Amazon executive, said that reducing the commission fee ratio will improve Amazon's competitiveness in the low-priced clothing space, because a piece of clothing that is $1 or $2 cheaper can make a big difference.
What's the difference?Of course, users who are attracted by SHEIN's cheap clothing can turn their heads to look at themselves.
SHEIN has previously attracted many fast fashion brands with its strong ** chain, and in September this year, it also won a third of the shares of Sparc Group, the parent company of Fast Forever 21.
Among the thousands of merchants who poured in in the first two months of SHEIN's opening of third-party merchants, most of them opened stores on Amazon, and some leading brands were also attracted.
It is equivalent to saying that Shein has robbed a lot of merchants from Amazon.
Still far ahead
Even so, Amazon currently dominates e-commerce in the United States.
According to Insider Intelligence, Amazon accounted for 37% of e-commerce sales this year6%。
If ranked by sales, it ranks first among the top 15 retail e-commerce companies in the United States, reaching 4,311$100 million, far behind Wal-Mart, which ranks second.
It's no wonder that when TikTok e-commerce finally improved in the United States, Amazon's face did not change its color and heart did not beat, after all, the results were far ahead.
Now facing Chinese e-commerce"Extreme value for money"The threat of Amazon, the crisis is felt. It can be said that Pinduoduo's volume, Amazon also had to pick up.
Not only domestic people, but also foreigners love cheap goods, and both SHEIN and Temu use ultra-low price strategies to attract American consumers.
temu has a wider range of products, including not only clothing, but also household goods, auto parts, electronics, and musical instruments. And SHEIN mainly sells fashion**.
Amazon first attacked cheap fashion**, obviously not wanting too many Prime members to be attracted to SHEIN cheap clothing.
"Panicking" is not a good thing
While 93% of users who access temu based on data also use Amazon, only 8% of Amazon users also use temu.
Amazon's conversion rate is close to 12%, compared to only around 5% for Shein and Temu.
In other words, temu and shein still have a long way to go if they want to surpass Amazon in the US e-commerce field.
But Amazon's reduction of commission at this time may be a good strategy. If you wait until the merchants all go to SHEIN and their members are lost, I'm afraid it's too late.
After all, the low-price strategy is easy to use all over the world, and Amazon should also fight the low-price war with a twelve-point spirit, even if it is unshakable now"Towering trees"。
Don't ignore the humble saplings when the tree is in full bloom, if you don't work hard to grow, sooner or later the small saplings will grow into towering trees.
At that time, it will snatch more resources, and it will only be a dead end.
It's not a good thing that Amazon is panicking, and it will be interesting to see what big moves it has in the future.