Transformation Of Cross Border Clothing E-Commerce Under The New Normal

According to the statistics of China Customs, in 2020, 2.45 billion bills of import and export bills were released through the customs cross-border e-commerce management platform, a year-on-year increase of 63.3%, which is four times higher than that in 2017 when the negative impact of the international macro environment was relatively small. In terms of volume, in 2020, China's cross-border e-commerce import and export increased by 31.1% year-on-year, of which the export growth rate was 40.1%, much higher than that of import.

The good situation of cross-border e-commerce benefits from the support of enterprises and domestic policy resources, as well as the mature supply chain, manufacturing and talent advantages accumulated in the long-term development of the industry. Domestic cross-border e-commerce has not only accumulated strong products, but also actively explored how to use new technologies and new channels to better meet the needs of consumers. With the guidance of our predecessors, more and more e-commerce enterprises are striving for the dream of becoming a popular consumer brand in the world.

At the same time, the market environment is also transmitting a similar signal to all e-commerce enterprises - the market environment is becoming more and more mature, and enterprises need to find a sustainable development model. In 2019, the penetration rate of global cross-border online shopping has reached 51.2%. After 2020, under the catalysis of the epidemic situation, the changes of consumer groups and shopping psychology are accelerating, and the global e-commerce market is accelerating development, and gradually evolved into a "new normal", which requires cross-border e-commerce people to adopt new ways to maintain their own sustainable development and obtain more long-term vitality.

I. brand building: a new turning point for cross border E-commerce

Under the influence of the epidemic, a large number of global consumers' shopping behavior has shifted from offline to online, which not only brings excellent development opportunities for cross-border e-commerce, but also profoundly changes the competitive pattern of cross-border e-commerce. Although the growth of users seems to be easy, how to retain users has exposed the shortcomings of traditional business model of distribution and flow realization. If the growth of brand sales is centered on traffic and commodities, the communication and connection with consumers will be ignored. On the contrary, for consumers, the contact with the brand will be limited to the purchase behavior, without leaving a deep shopping impression and experience. In this way, it is difficult for brands to achieve user precipitation, which means it is more difficult to obtain sustained growth. When the industry dividend gradually recedes and the competition changes from increment to stock, if we want to achieve long-term sustainable development, how to drive growth from users and build brands to precipitate consumers has become the top priority of cross-border e-commerce.

The purpose of brand building is to build up the ability to open up the market, occupy the market and obtain profits. Only by relying on strong brand influence, can we build a clear loyalty degree in consumer groups. It determines the customer's preference for brand choice, and more importantly, it determines the degree of customer's attention and trust in the brand. In this way, it can avoid repeated price competition, avoid business risks, and enjoy the value brought by the brand. On the other hand, with the improvement of users' own experience in cross-border online shopping, users' recognition of the brand is also increasing, and cross-border e-commerce ushers in a critical turning point to maintain the development of brands.

In order to build a sustainable brand development model with cross-border e-commerce, Google and Deloitte jointly released the 2021 China cross border e-commerce development report (hereinafter referred to as the "report").

This article, from the perspective of consumer groups and track analysis, hopes to provide some thoughts on the direction of sustainable brand building of cross-border e-commerce under the new normal.

2. Consumers: in depth online shopping and brand awareness

The changes of the current business environment and shopping mode will have a great impact on the e-commerce consumers and the track in 2020. On the one hand, the main consumers of e-commerce gradually mature their cognition of brand and are willing to recognize the value of the brand; On the other hand, although the category of e-commerce has not changed much, it still takes clothing fashion, home gardening, 3C products and beauty makeup as the main track, but there is more room for brand development in some of the circuit segments, and the customer price has been improved.

In 2020, the epidemic will not only bring "social distance", but also lead to the periodic "lock city" in some developed countries due to epidemic prevention, and the living conditions of consumers will be greatly changed. In order to understand the changes of online shopping consumers' shopping behavior and psychology, the researchers of 2021 China cross border e-commerce development report based on the mature cross-border E-commerce markets represented by the United States, the United Kingdom, Germany, France and Spain, conducted a survey on online consumers who had purchased through independent e-commerce channels in the past 12 months, and collected a total of 5005 questionnaires.

Three kinds of consumer age distribution, income and purchase categories from 2019 to 2020

(source: China cross border e-commerce development report 2021)

From the survey results, we can see that the change of consumer lifestyle has a more direct impact on the growth of cross-border e-commerce retail. According to the report, "from 2019 to 2020, the overall retail sales of e-commerce in major countries in Europe, the United States and the Asia Pacific region have experienced a rapid growth of more than 15% Such rapid growth comes from three groups of people, namely, the "online shopping interns" who did not buy things online but began to try online shopping; Have rich online shopping experience, now is to expand the consumer brand "online shopping gifted students"; The "online shopping conservatives" who have rich online shopping experience and have not expanded the categories but increased the consumption amount. These three kinds of consumers represent different consumption behavior patterns, but undoubtedly contribute to the rapid growth of cross-border e-commerce.

The change of consumers in the new normal is lasting, which is also reflected in the report: among the consumers of all categories who bought online for the first time during the epidemic period, an average of 75% said that they would continue to purchase online after the end of the epidemic, which also indicated that the strong growth momentum of global e-commerce in 2020 would continue.

At the same time, the change of consumers in the new normal is also deep-seated. Consumers spend more on the official website or app of the brand. 75% of these consumers have increased the frequency of shopping on the official website or app of the brand, 68% have increased the amount of single purchase, and are more willing to try new brands. Not only that, we also find that consumers are more likely to "impulsive consumption". Compared with 2019, the proportion of online consumers of fashion in the United States has increased from 31% to 42%, and promotion information and advertising can stimulate consumers to a certain extent.

On the other hand, emotional factors are still one of the important factors of consumers' repurchase. The cross-border e-commerce, while constantly improving the functional value, establishes emotional connection with consumers through specific brand values and values, and helps the brand to build "human settings", so as to bring sustainable development opportunities for the brand. In the post epidemic era, brand building is the most direct and effective way for cross-border e-commerce to achieve sustained growth.

3. Brand track: looking for space in the field of customer price and segmentation

The epidemic not only changed the purchasing behavior and mentality of consumers, but also promoted the multi-point growth of e-commerce retail categories. According to the report, clothing fashion, home gardening, 3C and beauty make-up are the most outstanding overseas racetracks in 2020. Since the above-mentioned products were originally in line with the operation requirements of cross-border e-commerce in terms of shopping frequency, logistics, customer price, etc., it has long-term incremental space. From this perspective, it is not surprising that such a trend exists.

Fashion category:

Clothing fashion is characterized by mature supply chain, convenient logistics, stable profit space between customer price and cost, and stable demand. For cross-border e-commerce, the sales risk is relatively low, and it will be one of the important tracks of cross-border e-commerce before 2020. During the epidemic period, the fashion track gained significant traffic dividends and became an opportunity for cross-border e-commerce to go out to sea. Among them, the independent station direct to consumer (DTC) brand mainly exists in the market with a customer price of less than $50.

At present, clothing fashion category is still the main source of traffic on the website, but the head DTC brand is more prominent in the app end. Women's wear category because of the broad market, the competition is more peaceful, brands can still look for opportunities.

Home gardening brand:

A number of vertical DTC brands focusing on home gardening products have emerged, which is changing the dominant position of retailers and third-party platforms. Due to the characteristics of home gardening products, the frequency of re purchase is not high, and the website of this category is still the main channel to obtain traffic. In the subdivided categories, kitchen products are worthy of attention, not only in the overall retail sales close to the furniture category, but also achieve greater growth, while the competitiveness is relatively small.

3C vertical brand:

The overall growth of 3C market is strong, brand e-commerce has occupied a dominant position, and many vertical categories of DTC brands are growing rapidly, such as vacuum cleaners, hair dryers and air purifiers. At the same time, the report found that because these brands are deeply rooted in different market segments, the overall competitive environment is relatively relaxed, especially the segment track of household electronic product brands has a high growth rate, and the industry competition is relatively low.

Beauty care products:

On the beauty track, retailers still dominate. However, under the epidemic situation, brand e-commerce, especially DTC brands, showed a trend of rapid growth. Some brands broke through the core price of $50 to develop into medium and high unit price, showing strong competitive potential in beauty individual care products. In the subdivided categories, the personal care category enjoys higher retail sales while maintaining a higher growth rate; The demand of skin care and sunscreen products is far higher than that of cosmetics and individual care products, and the relative competition is low.

Sustainable solution: linkage of brand, user and product

For cross-border e-commerce, when we talk about "brand building", we should call it a sustainable e-commerce business model rather than a simple brand marketing. With users as the core and single brand site as the carrier, it provides customers with products with dual connection of emotion and function, forming the linkage among users, products and brands, so that cross-border e-commerce can obtain sustained growth.

Under the influence of lifestyle changes, the change of market structure and consumer behavior mentality has brought unprecedented development space for cross-border e-commerce, and brand official website has ushered in a new round of development opportunities. In addition to the functional performance of products, brands can be favored by consumers. How to establish brand awareness through effective channels, continuously optimize the operation of brand official website, so as to enhance consumers' trust, and finally realize transformation and repurchase is also an important part in the pursuit of long-term sustainable development.

With the change of consumer behavior, the competition pattern of global retail market is also changing rapidly. On the four opportunity tracks of fashion, home gardening, 3C products and beauty and personal care, we will continue to pay attention to the customer price and subdivided track as the consideration factors of brand development. DTC brand has a broad development space in fashion category. In the home gardening track, some vertical categories of DTC brands grow rapidly, and the future can be expected. The overall growth of 3C market is strong, and the relative competition is low, which provides more opportunities for brands. DTC brands also showed strong competitive potential in the beauty care category, with several brands breaking through the $50 core price band.

summary

Cross border is a "new life" for the clothing industry. With an estimated value of more than 10 billion US dollars, she is known as the vanguard of Chinese clothing; The swimsuit cross-border cupsh has been exported to Europe and the United States with an investment of over 100 million yuan; It has been 4 years since the establishment of cross-border e-commerce project for SEMAR apparel... Cross border clothing has become a new focus on the new track of the sea.

In recent years, from global free trade zones to cross-border support policies across the country, all have pushed cross-border e-commerce to a stage of rapid growth. According to the data of some regions, the categories of clothing, shoes, hats and knitwear have occupied the first place in the cross-border sea going.

The only martial arts in the world are fast. Whether it is the ten billion valuation of sheen or the blue ocean opportunities across the border, they are inseparable from the support of China's powerful textile and clothing and mobile Internet supply chain! China's textile and garment industry chain is the most perfect among the global textile export countries, with cluster layout of upstream fiber, midstream fabric accessories and downstream clothing industry. In the future, the high stability of China's supply chain will be increasingly valued by global brand customers.