Retail tends to flow, whether it is e-commerce or physical retail, the amount of flow can directly affect the rise and fall of retail.

The advent of the Internet era makes online retail extremely popular, also because the Internet has huge traffic. The Internet is different now, and the online traffic dividend is peaking. According to data released by Qianzhan Industry Research Institute, the growth rate of China’s online shopping market has dropped from 42% in 2013 to 29.6% in 2017, and the growth rate of online users has also dropped from 26.3% in 2013 to 14.3% in 2017. On the contrary, the cost of acquiring passengers is doubling. Therefore, it has become the breakthrough direction of e-commerce to find new traffic entrance and how to gain customers through low cost.

As for the physical retail, although the cost of acquiring customers is low, how to retain customers, how to provide customers with more consumption scenarios to improve the re-purchase rate, and how to acquire more new customers are also the biggest concerns of the physical retail.

Solomoization has gradually become the best solution for physical retail transformation.

The concept of SoLoMo was first proposed by John Doerr in February 2011. He believed that the future development trend of the Internet was Solomoization, namely socialization, localization and mobility. Later, the development of social networking sites and platforms such as Facebook, wechat and Weibo, as well as location-based services such as Dianping and Baidu Map, etc. Are the best arguments for this point of view, and now new retail is also developing towards these three aspects.

The mobility of new retail

Mobile can bring great benefits to retail, which e-commerce has the best say, so the mobile of new retail is mainly aimed at physical retail. The mobility of new retail can be divided into two parts, one is online mall, the other is mobile payment means.

In terms of methodology, new retail is a retail model combining online and offline. For retailers, sticking to the online or offline channels is not a wise choice. Miniso, for example, has stuck to its bricks-and-mortar retail model while the whole industry has embarked on a new retail revolution. Recently, it has been forced to join the wave of reform, entering Jingdong Home, Meituan and Ele. me.

For new retailers, building an online mall can not only realize the flow exchange between online and offline and obtain more customers, but also help meet the fragmented or customized consumer needs, create a more perfect membership mechanism and establish big data. So we can see that all the new retail players are not falling behind in the creation of online channels. Hema Fresh, Tao Fresh, Yonghui Life, Jingdong Home, food line fresh…… Whether entering platform or self-built platform, open online channels has become the standard of new retail.

Mobile payment plays a finishing touch for online shopping malls, but also adds a lot of luster to offline retail. The electronic and mobile means of payment make people’s consumption more convenient and invisible, and also improve the efficiency management of enterprises. Retail is increasingly dependent on mobile payment, such as: unmanned supermarkets rely on mobile payment; Hema was once criticized for forcing consumers to use mobile payment. Although it later provided cash collection service for employees, alibaba New Retail still insists on mobile payment. After the new retail transformation, many traditional supermarkets have also enabled the scanning code shopping function, so that customers can self-scan code for checkout.

Online shopping mall and mobile payment complement each other, jointly promoting the mobile of new retail. In the context of mobile, new retail can not only get more traffic, but also become digital and intelligent.

Localization of new retail

Localization is the core scenario for new retail. We can see from the new retail layout of Alibaba and Tencent, the new retail is a localized layout. Hema presents delivery within three kilometers in half an hour. The so-called three-kilometer living circle is a manifestation of localization.

It should be noted that the so-called localization does not mean the localization of products, but the localization of consumption, that is, consumers can consume the products and services they want in the local, not necessarily across a long distance and time. Like Hema, we can consume fresh food and products from all over the world.

In addition to Hema, Ali also attracted many traditional retail giants, such as Sun Art retail, Sanjiang Shopping, Xinhuadu, Bailian Group, Lianhua supermarket, Intime, Suning, Yiguo fresh, Surprisingly home and so on. Last September, Ali koubei launched its own APP. Earlier this year, Alibaba added word-of-mouth to the four-way army of alibaba’s new retail. On Oct 12, Alibaba announced the formation of a local lifestyle service company, combining Ele. me and Koubei.

So far, Ali’s new retail covers many industries and fields including clothing department stores, electrical appliances, fast retailing fresh food, catering and other local life services. It is said that physical stores are the last mile of retail, and Alibaba’s new retail partners have a large number of physical stores, which are scattered throughout the community. Behind this layout is the creation of a three-kilometer living circle. In the future, consumers will be able to buy any product through new retail platforms and receive it in a fraction of the time through nearest store delivery. In a sense, this is also a subversion of the current e-commerce platforms such as Taobao and JINGdong. Just as Jack Ma said, “In the next ten or twenty years, there will be no e-commerce, only new retail.” .

Similarly, Tencent also has a stake in yonghui Supermarket, Carrefour, Wanda Commercial, Hailan Home and other large retail enterprises. Last October, Tencent invested heavily in Meituan Dianping. Tencent’s layout of new retail localization is similar to That of Alibaba.

In the future, localized new retail is a retail model that understands the consumption habits and needs of a region and distributes corresponding products and services locally. This can not only improve the speed of receiving goods for customers, but also reduce logistics costs for merchants. Therefore, it can also be said that the localization of new retail is the optimal allocation of resources.

The social aspect of new retail

After years of development, China’s e-commerce industry has gradually formed a situation of one over one strong, but this year, the situation was broken by Pinduoduo. With the social e-commerce model, Pinduoduo has become the top three online sales market share in just three years, which is legendary.

According to pinduoduo’s latest financial report, the number of active buyers in the 12 months ended June 30, 2018 was 343.6 million, up 245% from the same period last year. By comparison, Alibaba had 576 million active buyers in the same period, while JD.com was overtaken by Pinduoduo with 313.8 million annual active buyers.

The success of Pinduoduo is inseparable from Tencent and wechat. Social interaction and fission enable PDB to attract customers at a lower cost and gain great exposure. Last year, pinduoduo cost only 11 yuan per person to acquire customers, much lower than JD.com and Alibaba. With such unique resource advantages, Pinduoduo has become the fastest growing e-commerce provider in 2017.

And this year, social retail has exploded. In addition to Pinduoduo, Youzan, Yunji, Liushuoshuo and other social e-commerce platforms, which have all received over 100 million yuan of financing, social networking has also become an important part of the new retail layout of Alibaba and Tencent.

Wechat mini program has become the pacesetter of Tencent’s social retail, enabling many retailers to realize online and offline communication and social interaction through small programs.

Alibaba, by contrast, lacks the social gene, so turning to other social platforms is its main strategy. For example, on November 11 last year, Tmall cooperated with Momo to carry out e-commerce marketing through live broadcasting, short videos and other popular social media. In December of the same year, Weibo announced the opening of the public test of the content shopping guide platform. When users click the product link when reading the content on Weibo, they can directly complete the purchase in Weibo or jump to taobao platform to purchase. Since March this year, Douyin and Taobao have been connected, from douyin can ride through a train to Taobao one-click.

In addition, even coffee and other new retail models have launched a new game with “universal coffee” as the core through social networking, selling millions of cups of coffee in a week.

In addition to connecting online and offline, social networking is also the place closest to consumers on the Internet. If physical stores are the last kilometer of physical retail, then social networking is the last kilometer of Internet retail. Therefore, for the new retail model combining online and offline, it is reasonable to develop social.

Traffic is important, but so is service

Social, local and mobile retailing is about traffic, but it’s also about getting closer to consumers. This is a process of finding customers for products. Therefore, new retail should uphold the concept of understanding customers, knowing their needs, delivering corresponding products and services to consumers, and making their consumption more convenient and experience better.

Mobile may be able to collect consumption data, but mandating it is counterproductive. Technology is supposed to be convenient, but if it makes it more difficult, it defeats the purpose. How to guide consumer skillfully to use or adopt comprehensive purchase means ability to let flow unapt one-time loss.

Localization can improve efficiency for both consumers and merchants, but it also has risks. Lack of knowledge of local spending power and habits can lead to a build-up of inventory. Therefore, understanding customers and allocating according to their needs is not only the condition to meet personalized needs, but also the premise of optimal allocation of resources.

While socializing can acquire customers at low cost and get closer to consumers on the Internet, it still has the problem of insufficient standardization, which leads to the lack of user trust and limits the development of retail. Therefore, it is more important to strengthen standardization and enhance the trust of consumers than to devote all efforts to promotion.

Overall, solomomization has a huge potential for traffic, but capturing that traffic is a long-term strategy. Day and night are always better than chance encounters.

Article/Liu Kuang public number, ID: Liukuang110, this article first kuang Venture capital network