中国电商行业视频直播电子商务拼图关键部分

1、本文格式为Word版，下载可任意编辑 中国电商行业视频直播电子商务拼图关键部分 CONTENTS Investment Summary 3 Live Streaming: The Crucial Piece of the eCom Jigsaw Puzzle 4 Live-Streaming Shapes Short-Video Apps as eCom Platforms 7 Short Video is Better at Traffic Acquisition, Rather Than Conversion 7 Live Streaming Improves Transaction Co

2、nversion on Short Video Apps 8 Three Kinds of Partnerships, Different Financial Economics 8 Financial Returns Could Drive Renegotiation with eCom Companies 9 In-App Stores Providing Short Video Apps have the Highest Financial Returns 9 Renegotiation of the Commission Sharing Scheme May be the Best O

3、ption 9 A Closer Look at Short Video Apps eCom Functions 10 Kuaishou, the #1 eCom Live Streaming Short Video App in China 10 Douyin Rapidly Catching up, leveraging a Large User Base and its Alibaba Partnership . 11 Live Streaming Boosts the Conversion Rate in eCom Apps 13 Taobao Live: The Leader in

4、eCom Live Streaming 13 JD.com: Fast Catching Up to Secure the #2 Market Position 15 PDD; An Aggressive New Entrant Trying to Differentiate its Service Offering 17 eCom Enriching Monetization of Pan-Entertainment Apps 18 Two Frequently Asked Questions by Investors 20 Q1: What Types of Products Are Su

5、itable for eCom Live Streaming? 20 Q2: Whose Market Shares Are eCom Live Streaming Taking? 21 Booming MCN amp; Host Market Has Benefited eCom Live Streaming 22 Government Regulation Enhances Service Creditability 23 eCom companies have embraced live streaming technology, and Alibaba is clearly ahead

6、 of peers Short video companies are unsatisfied with the current model and commission sharing We view the concerns over the potential competition from the decentralized eCom as over- done Investment Summary Chinas video live streaming driven eCom GMV in 2022 exceeded CNY450bn, c.4% of the total onli

7、ne shopping GMV, and is expected to grow at a CAGR of c.85% to reach CNY2.9tn in 2022 according to iResearch, representing c.16% of the total eCom GMV. We view eCom companies, including Alibaba (BABA.US, OW), JD (JD.US, OW) and PinDuoDuo (PDD.US, EW), and short video companies, such as ByteDance (pr

8、ivate, not covered) and Kuaishou (private, not covered), as the major beneficiaries of the market tailwind. Video live streaming services have existed for more than a decade in the online pan- entertainment industry in China, with technology and user acceptance at relatively mature levels. Functiona

9、lly, we see an opportunity for eCom companies to escalate user engagement and improve transaction conversion rates; it also provides short video apps with a tool to convert their top-of-the-funnel user traffic to eCom transactions. On the eCom company side, Alibaba, JD and PinDuoDuo have seamlessly

10、integrated the online shopping value chains from user traffic acquisition and product procurement, to payment and logistics. With annual buyers reaching 726mn, 384mn, and 628mn in the past quarter, we think it is crucial that companies improve users stickiness on the platforms and facilitate consume

11、rs in making their purchasing decisions. Live streaming as a virtual interactive scene fits in perfectly with this requirement, and Taobaos achievement in the past Singles Day and 6.18 shopping event proves its effectiveness. Under our eCom coverage, Alibaba is well ahead of its peers on this front

12、with more than CNY200bn GMV generated in 2022, representing c.45% market share. It has attracted more than 400mn live streaming users. Its GMV mix is well balanced between the store owners/sellers (c.70%) and the KOLs/celebrities (c.30%). Alibaba has teamed up with the Douyin app (also known as TikT

13、ok outside of China, owned by ByteDance), leveraging its short video user base. JD is also similarly partnering with Kuaishou, and has achieved good results during the past 6.18 promotion. On the short video company side, the short video apps were initially involved in monetizing user traffic with a

14、ds services, with eCom companies just another ads vertical. Later, the short video apps adopted deeper partnerships with the eCom companies. By assisting their merchants in opening stores and selling products inside short video apps, the short video companies started to share in commissions (1-2%).

15、According to 36K, Kuaishou was the #1 short video app with CNY35bn in-app GMV in 2022. However, short video apps were not satisfied with the partnership with eCom companies. Given the better financial economics, Kuaishou and Douyin launched their Store functions, bypassing eCom companies to directly

16、 invite merchants to open stores in the short video apps. In this case, we estimate the apps can earn c.5% commissions. We dont view the new Store function as a big threat to eCom companies. First, the eCom business has a much longer value chain which requires deeper industry expertise than the ads

17、business, so it takes time for short video apps to lift their learning curve. Secondly, we believe the one-stop services, including payment, logistics, marketing solutions and supply chain management services provided by the eCom companies will be very difficult to be fulfilled by the short video ap

18、ps in the near term. In addition, most of the brands and scalable retailers have built up steady relationships with Alibaba, JD and PinDuoDuo, which is not that easy to break. As a result, we are not that worried about the potential competition from the decentralized eCom ecosystem developed by the

19、short video apps. It seems more likely that the short video apps and eCom companies would renegotiate a commission sharing scheme. In the competitive eCom market in China, both the existing players and new entrants are exploring opportunities to enhance conversion rates Live Streaming: The Crucial P

20、iece of the eCom Jigsaw Puzzle eCom companies have never stopped pursuing market share expansion from the online peers and offline market, even though Chinas online shopping penetration already exceeded 25% in CY19. The other mobile Internet traffic entrances, such as short video, social and media a

21、pps are also looking for opportunities to increase their share of Chinas retail market, which amounted to CNY41tn (US$5.9tn) in 2022. After almost two decades, we are starting to see relative stability in the competitive dynamics of both the upstreaming (user traffics) and down streaming (fulfilment

22、 services) of the eCom market. On the user acquisition side, instant messaging, video (long and short) and media platforms share the top layer of the traffic funnel, while eCom companies, such as Alibaba and JD, dominate and consolidate the logistics and delivery markets. As a result, all these comp

23、anies are exploring measures to enhance the from-traffic-to-transaction conversion rates, and have coincidently selected video live streaming as the critical element. FIGURE 1 Live streaming eCom has advantages against the other shopping formats in multiple areas Live streaming eCom Short video eCom

24、 Traditional shelf eCom TV Shopping Offline shopping Shopping format Real time elaboration + Company + Purchase Browsing + Purchase Browsing + Purchase Real time elaboration + Purchase Real time elaboration + Company + Purchase Characteristic More interactive More experience More professional More p

25、ricing advantages More traffic sources Higher conversion Less interactive Less interactive More experience Less experience More professional Less professional Less pricing advantages Less pricing advantages More traffic sources More traffic sources Higher conversion Lower conversion Less interactive

26、 More experience Less professional Less pricing advantages Less traffic sources Lower conversion More interactive More experience More professional Less pricing advantages Less traffic source Lower conversion Visit sunk cost Low Low Low Low High Users decision cost Low Lower Medium Higher Lower Sour

27、ce: Barclays Research Video live streaming enhances short video apps role as a major traffic contributor to online shopping We view the video live streaming function as a critical step in the ongoing evolution of Chinas eCom industry. Its rapid development and prevalence among Internet users has fue

28、lled the restructuring of the online shopping value chain and redefined consumers purchasing behaviours. The reform not only expands the addressable user base, such as the integration with short video apps such as Douyin/TikTok, and Kuaishou, but also substantially improves existing user engagement

29、and shopping experience in the online shopping apps (Taobao, JD.com, PinDuoDuo, etc.). Specifically, we think the changes are happening on the following fronts: 1) Short video apps: Douyin and Kuaishou have experienced dramatic growth in the past three years, accumulating about 489mn and 379mn MAU a

30、s of December 2022, according to QuestMobile. Each daily user spends more than one hour per day in each app, and more than 10 times each day. Such high engagement apps have created new traffic funnels to the eCom platforms. However, the length of short videos on Douyin and Kuaishou is normally betwe

31、en 15 seconds to several minutes, which is insufficient to provide a comprehensive introduction of products or brands, in our view. Video live streaming creates the connection between the short video traffic and the hosts, who can further drive consumer interests in the products and promote their de

32、cision-making. We think live streaming functions substantially improve the conversion rate from transaction leads to the final transaction. FIGURE 2 Short video was the #2 vertical category in China, in terms of user daily time spent and daily session frequency Source: QuestMobile, Barclays Research

33、 The integrated short video and live streaming marketing solution not only generates high quality leads to the Taobao and JD merchants that set up stores on the short video apps, but also directs traffic to the merchants who directly open stores in the short video apps. The latter might cause some p

34、otential competition with Taobao and JD, as the merchants can bypass the eCom platforms and open stores on Douyin and Kuaishou. FIGURE 3 Mobile Internet user traffic funnel of online shopping services Source: Barclays Research Live streaming functions enhance the transaction conversion rate in eCom

35、apps 2) Online shopping apps: Alibaba was the first eCom company to realize the importance of the live streaming function and launched these channels within Taobao as early as 2022. With 846mn mobile MAU and 726mn annual active buyers as of March 2022, Alibaba is more than just an online shopping ve

36、rtical, as its rich functions, such as local services, ticket/hotel booking, second-hand products, classified services, etc. have propelled it to the top-layer of the traffic funnel. Following Alibaba, the other two major eCom players, JD.com and PinDuoDuo have also launched live streaming channels

37、in their apps. The above eCom platforms also own industry leading fulfilment capabilities and payment services to close the transaction loops. In our opinion, they only need to enhance the conversion rate from the user traffic to the ultimate transaction. We view live streaming as the most effective

38、 tool to improve the user understanding of these products, as they organize promotions and help users make purchasing decisions. According to Alibaba, its Taobao Live Streaming function generated more CNY200bn GMV in CY2022, representing about 3% of Alibabas total GMV, implying significant improveme

39、nt upside. FIGURE 4 Live streaming driven eCom GMV and market share (%) 3,500 3,000 2,500 2,000 1,500 1,000 500 0 2022 2022 2022 2022E 2021E 2022E Live streaming driven GMV as % of eCom market size 25% 20% 15% 10% 5% 0% Source: iResearch, Barclays Research eCom is becoming a new monetization measure

40、 for pan- entertainment live streaming apps 3) Pan-entertainment focused live streaming apps: This group of companies, such as JOYY (YY.US, not covered) and TianGe (1980.HK, not covered), are the pioneers of Chinas live streaming industry, launching their services as early as 2022. They primarily co

41、ncentrate on entertainment-focused content, such as live shows, dancing and singing. With blockbuster online gaming titles, such as League of Legends, Honour of Kings, PUBG, accumulating a large audience, game live-streaming services have become another popular vertical, represented by Huya (HUYA.US

42、, not covered) and Douyu (DOYU.US, not covered). eCom was not an initial focus of the pan-entertainment apps. On one hand, with a MAU of less than 100mn about 2 years ago and a relatively low session frequency, these apps were not at the top of the traffic funnel for eCom services. On the other hand

43、, their business revenues are mainly generated from virtual gifts to the hosts, which already generates quite healthy financial economics, thus we think the platforms lack the incentives to dabble in the relatively complicated eCom live streaming services. The situation started to change in 2022, as

44、 eCom live streaming became more prevalent and was accepted by the audience. Hosts can either introduce transaction leads to third party sellers, or close the transaction in the hosts own stores. The well-established offline logistics infrastructure also simplifies the sellers workload. We note prod

45、ucts are mainly concentrated in non-standard SKUs, such as jewellery and sportswear. CNY bn 2,855 1,949 1,157 451 21 150 Short video is the #2 traffic generator on mobile Internet in China with c.86% user penetration Live Streaming Shapes Short-Video Apps as eCom Platforms Short Video is Better at T

46、raffic Acquisition, Rather Than Conversion Short video apps, specifically Douyin and Kuaishou, have structurally redefined Chinas mobile Internet traffic funnel in the past two years, as reflected in the substantial increase in user time spent and mindshare on short video content. According to CNNIC

47、 (China Internet Network Information Center), in terms of active users, short video exceeded Search to become the #2 vertical function in early 2022 with 85.6% penetration, next to instant messagings 99.2% (Figure 5). Based on QuestMobiles tracking, as of December 2022, the short video category repr

48、esented 13.7% of Chinese Internet users total time spent on mobile, vs. instant messengers 26.8% (Weixin 20.6%, 6.1%), with Douyin and Kuaishou contributing 6.5% and 3.9% (Figure 6), respectively. FIGURE 5 Vertical functions penetration in Internet users 100% 90% 80% 70% 60% Jun-18 Dec-18 Jun-19 Dec

49、-19 IM Search News Short Video eCom Payment Source: CNNIC, Barclays Research FIGURE 6 Short video is 2nd in the top 4 apps by user time spent Instant messaging: Short video: Source: QuestMobile, Barclays Research Short video as a standalone function generates leads, but is not enough to generate in-

50、app eCom transactions Given the sensitivity of advertising budgets to user volumes and engagement, we note highly disruptive effects by short video apps on the China online ads market. Marketing revenue growth of companies such as Baidu and Weibo saw a substantial slowdown in the past two years prim

51、arily due to the competition with Douyin. We explore this in greater detail in our previous research reports (Online Ads Market Transitioning in A Challenging Macro Environment, June 14, 2022; China Internets New BBAT Paradigm, February 23, 2022). Initially, short videos were mainly used as a market

52、ing tool to attract user eyeballs and generate traffic to eCom stores outside the short video apps ecosystems, rather than closing the transaction loops inside the apps. The weakness of the business model is that short video apps could lose their control of user traffic during the jump to other thir

53、d party apps. This is not a big surprise to us, as the length of the short videos normally ranges between 15 seconds to several minutes, which means that the product information and interaction between the sellers and consumers might be limited. From a financial economic perspective, it also makes s

54、ense for the short video apps to retain the transactions inside the apps, given higher commission rates. Live streaming plays a perfect supplementary role to short video Live Streaming Improves Transaction Conversion on Short Video Apps We view video live streaming as the perfect solution, as it cre

55、ates a lively scene to connect users with the sellers. The live streaming channels are primarily interest-based, as users can choose to follow different hosts (KOL, celebrities) or brands official channels/accounts. Compared to the general product introductions in the traditional eCom product pages

56、or short video clips, live streaming can provide more granular details of the products and virtually narrow the distance between the audience and sellers. As illustrated in the traffic funnel (Figure 3), while short video content stays at the awareness layer to broadly attract user attention, video

57、live streaming focuses more on the interest layer to influence the consumers purchasing intent, make the payment decision and complete the transaction either inside the short video apps or the merchants stores on Taobao or JD.com. Three Kinds of Partnerships, Different Financial Economics Short vide

58、o apps have three main ways of monetizing eCom related traffic. In (Figure 7), we use Douyin as an example of how traffic originating from short video apps can: 1) Generate traffic to non-Taobao merchants stores outside of the app, which could be Weixin stores or the sellers own website for example.

59、 In fact, this scenario is the traditional advertising model for short videos, as Douyin charges merchants based on a CPM (cost per mile) or CPA (cost per action) model. Assuming the effective CPM at CNY40-50, this means every 1,000 impressions could generate about CNY40-50 revenues to Douyin. 2) Ge

60、nerate traffic to eCom partners, such as Taobao and JD.com. The final transaction and payment step is normally completed in the eCom apps. CPS (cost per sales) is normally used in this scenario, where Douyin, eCom partners and the hosts (and MCNs) share the commissions charged to the merchants. The