To be an internet celebrity, Musk should come to China

  Musk is playing cards out of line again.
  A few days ago, he said on social media that he was considering quitting his current job and becoming a full-time “influencer”. The translation of an influencer is an opinion leader. In the current online context, “Internet celebrity” is more appropriate.
  In response to a comment from a netizen, he wrote: “I do aspire to entertain the people!”
  Musk is undoubtedly one of the most successful business leaders today. Tesla at the helm has led to changes in the new energy vehicle industry. Space x has rewritten the history of commercial manned spaceflight. Neuranlink, its brain-computer interface company, plans to use it on humans next year. .
  Recently, he was also successfully elected as the “Person of the Year” in 2021 by the US “Time” magazine.
  Does Musk really want to quit his job as an internet celebrity? Or is this just a whim? The outside world has no way of knowing, but one thing is certain, the best place in the world today to be a full-time Internet celebrity is China.
Be an internet celebrity in China more options

  Musk wants to become a full-time “influencer”, and the choices are nothing more than the following: opinion leaders, KOLs, and Internet celebrities.
  He is already an opinion leader. He is regarded as the greatest innovator since Steve Jobs and has more than 66 million global followers on Twitter. But from a practical point of view, whether it is KOL or Internet celebrity, in the United States, these two paths are not broad.
  KOL is actually a marketing concept, which refers to people who have more and more accurate product information, are accepted or trusted by the relevant group, and have a greater influence on the purchase behavior of the group; the Internet celebrity economy is related to the Internet. In-depth integration of business channels, bringing goods is the best way out.
  To put it simply, the goal of Internet celebrities is to become a KOL, and the goal of KOL is to bring more goods.
  In the early days, whether in Europe, America or China, there was nothing more than one way out for Internet celebrities: to undertake brand advertising. In essence, this is also a kind of carrying goods, but it stays more in the grass-planting link.
  With the rapid rise of the mobile Internet, there are more and more outlets for internet celebrities. It is also from the mobile Internet that China has begun to catch up with foreign countries in many business fields, and e-commerce is one of them.
  The biggest reason is that domestic social e-commerce started earlier and has a higher ecological maturity. It is also at the forefront in the combination of content and e-commerce.
  Even in China, the “Internet celebrity economy” was born from the integration of social e-commerce:
  In 2013, Weibo accelerated its commercialization, and its cooperation with Taobao opened the way for the integration of e-commerce and Internet celebrities. In August 2015, Ali held a seminar on the phenomenon of “Internet celebrity”, which systematically sorted out the “Internet celebrity economy” for the first time.
  By 2016, the Internet celebrity economy had become a trend. On Double Eleven that year, Zhang Dayi’s Internet celebrity store became the first Taobao women’s clothing store to exceed 100 million yuan.
  Also in this year, Weibo launched the “Weibo Showcase”, established an interest-oriented social e-commerce system, and officially merged Pinduoduo and Pinhaohuo. With the rapid rise of WeChat ecology, WeChat launched small programs and shows. The rapid rise of live broadcasting, the launch of Douyin by ByteDance, and the monthly active users of Kuaishou exceeded 150 million.
  In this process, the business models of Internet celebrities have gradually enriched. They receive live broadcast rewards on live broadcast platforms such as Douyu and Inke, sell products to fans on platforms such as Taobao, and advertise for brands on social media such as Weibo. It is also making money from content on short video platforms such as Kuaishou.
  These monetization models reflect a trend: most of them are integrated with e-commerce, and the degree of integration is deepening. E-commerce has thus become the largest monetization path for domestic Internet celebrities.
  However, the main monetization path of American Internet celebrities is still advertising.
  Three sets of data demonstrate this:

  According to Zenith research data, from 2017 to 2020, the United States and China contributed 47% of the new advertising spending share; in
  2018, in the US digital advertising spending, search, display, and video accounted for 73% of the market share, of which search accounted for 73%. In
  2019, in China’s Internet advertising distribution, e-commerce, display, search, and video ranked the top four, accounting for 91% of the market share, e-commerce advertising accounted for 29%, and search 17%;
  this It reflects two points: first, search advertising is gradually being eroded in China, and it is still the mainstream in the United States; second, the proportion of e-commerce advertising in China is significantly higher.
Why hasn’t live streaming in the US been done?

  As we mentioned above, after the arrival of the mobile Internet, China is at the forefront in the combination of social networking and e-commerce, content and e-commerce.
  This actually boils down to one point—the domestic exploration of the e-commerce model is more advanced, more radical, and more innovative.
  We have also seen that the purpose of all these explorations of new models is unified: on the platform side, it is to fight traffic anxiety and find new traffic increments; on the consumer side, it is to shorten the consumption link and improve the matching between front-end goods and people efficient.
  Live e-commerce, which started in 2016 and flourished in 2018, is another unique innovation in China.
  Its core is the further integration of content and e-commerce. The appearance is that the content platform is e-commerce and the e-commerce platform is content, and live broadcast actually plays a tool role in it.
  The early live broadcast e-commerce formed a win-win situation for all parties: content platforms got rid of a single dependence on advertising monetization, e-commerce platforms found new incremental markets, merchants ushered in improved marketing efficiency, and consumers also enjoyed more discounts free.

  Because of this, the potential of live e-commerce is quickly released:

  From 2017 to the first half of this year, the market size of live broadcast e-commerce has grown from 36.6 billion to nearly 2 trillion, and the market penetration rate is less than 15%;
  as of June this year, the user scale of live broadcast e-commerce has grown rapidly to 384 million, accounting for 60%, 47%, and 43% of live broadcast, e-commerce and short video users still have room for growth; in
  addition to Douyin, Kuaishou, and Taobao, Xiaohongshu, Zhihu, Pinduoduo, Station B, these Internet companies It has also accelerated the layout of live broadcast e-commerce;
  but the exploration of e-commerce in the United States is lagging behind. Taking live e-commerce as an example, the US live broadcast platform mainly focuses on game live broadcast, and users have not yet developed the habit of watching live broadcast.
  According to Stream Elements data, in 2019, Twitch/YouTube Gaming accounted for 73%/21% of the total viewing market of live streaming platforms in Europe and the United States, respectively. A survey by Statista also shows that by 2020, the proportion of users who have not used live streaming platforms in the United States will still be as high as 69%.
  This lag has in turn led to the limitations of the US e-commerce ecosystem. According to eMarketer data, the sales of e-commerce platforms in China and the United States in 2019 were 193.5 billion/586.9 billion US dollars, respectively, corresponding to 36.6%/10.7% of the total retail sales in China and the United States. The scale and consumption penetration rate of China’s e-commerce were 3.4/10.7% of that of the United States. 3.3 times.
  Returning to the perspective of online celebrity monetization, live e-commerce and leading star anchors are actually a process of mutual achievement. Li Jiaqi, Wei Ya, Simba and others have actually completed the class transition from Internet celebrity to KOL. During this process , Luo Yonghao also completed the identity transition from entrepreneur to KOL.
  This year, brand self-broadcasting has become a new outlet, and the large number of mid-waist and tail anchors have also ushered in a greater room for realization. Live streaming has become the most imaginative means of monetizing Internet celebrities.
  In contrast, the business logic of live e-commerce in the United States is not the same as in China, and the development is relatively slow.
  For example, Amazon launched the live broadcast function “Amazon Live” and the graphic “Amazon Posts” in April and October 2019, and officially started the process of contentization.
  A study by BCG also shows that Western shopping platforms focus on accurate and efficient shopping. Consumers often go to e-commerce platforms to select products after determining their shopping goals. In other words, in the US market, shopping logic has not yet been realized The transformation from “goods” to “goods looking for people” was realized as early as around 2015 in domestic e-commerce.
  In this case, it is difficult for foreign Internet celebrities to go through the road of live streaming.
Where is China’s e-commerce infrastructure stronger than foreign countries?

  According to the path of the domestic Internet celebrity economic ecology, e-commerce is the best path to monetization. Under the subdivision, live e-commerce can help them maximize economic monetization. The success of Li Jiaqi, Wei Ya, and Simba illustrates this. a little.
  However, bringing goods together combines multiple factors such as “people, goods, and fields”. If any one of these links is missing, it will affect the way out of Internet celebrities.
  Tracing the source, the slow development of the Internet celebrity economy
  in the United States is determined by the lag in the development of the e-commerce ecosystem: First, at the supply chain end, the hollowing out of the domestic manufacturing industry in the United States imposes certain restrictions on the development of e-commerce.
  On the one hand, the cost and scale advantages of China’s supply chain are more obvious, creating favorable conditions for the formation of a localized supply chain model.
  As the global manufacturing focus has shifted to China and Southeast Asia, where labor costs are low, large-scale chemical factory clusters have been formed in economic belts such as the Yangtze River Delta and the Pearl River Delta, with huge manufacturing capacity.
  The U.S. consumer goods manufacturing industry has undergone a process of transferring overseas in recent decades, with brand owners conducting production overseas and then shipping them back to the mainland, and the supply chain has expanded globally. Under the global supply chain model, major U.S. consumer goods are more dependent on imports, and the value of goods is relatively higher.
  On the other hand, U.S. manufacturing is more concentrated, while Chinese manufacturing is more fragmented.
  As a result, there are a large number of small and medium-sized enterprises in China who need to sell goods, and different models of e-commerce platforms have their place. For example, Taobao has largely realized the onlineization of markets such as Yiwu Small Commodity City, while most foreign e-commerce platforms are self-operated.
  Second, from the perspective of e-commerce infrastructure, the United States has a gap in logistics, payment and other aspects compared with China.
  In terms of express logistics services, cheap goods and services in the United States are expensive. Traditional e-commerce merchants mostly choose land transportation to control costs. One of the biggest pain points of land transportation is the weak timeliness.
  A data from UPS shows that the delivery time of goods shipped from New York by ground transportation to the New York City Group, East Coast Cities, Central Cities, and West Coast Cities is 1, 2, 3, and 4 working days, and even 6 working days in some areas. Working days, plus possible weekends and holidays, the actual time may be longer.
  Then look at payment. According to Statista, in 2019 the penetration rate of mobile payments in the United States was less than 10% of the total population, and the penetration rate among smartphone users was less than 30%.
  In China, since 2014, WeChat and Alipay have been fighting over the payment portal for a long time. WeChat payment and Alipay payment have already achieved the coverage of almost all transaction scenarios.
  Third, from the perspective of market size, there is insufficient innovation in response to the slowdown in e-commerce growth.
  The size of the US e-commerce market was $587 billion in 2019, and it has fallen into a bottleneck of growth. During the same period, China’s e-commerce market was $1.9 trillion.
  Today, the growth rate of China’s overall e-commerce market is also slowing down, but major platforms have found a new incremental market for live e-commerce.
  In contrast, overseas content e-commerce is still in its infancy. Instagram, Facebook and YouTube have already launched internal e-commerce systems, but the current level of integration is low, and they are even slower in live e-commerce.
  Taking Instagram as an example, it has built its own e-commerce function on the platform, but on the one hand, it is more inclined to large brands. On the other hand, only a few media/influencers can attach a link to the main product of the brand in the content.
  Fourth, from the platform side, the construction of closed-loop ecology is not as perfect as that in China.
  A typical example is the construction of an advertising marketing platform.
  Domestic platforms such as Ali, Douyin, Kuaishou, etc., have built a docking platform between advertisers and advertising contractors, such as Juda Engine, Alimama, etc. They actually lower the threshold for docking between the two parties, and can achieve data precipitation and standardization management, and can improve its own platform ecology.
  In the United States, such platforms are still dominated by third-party institutions.
Epilogue

  Going back to the Internet celebrities bringing goods, there are only three dimensions to measure the economic ecology of Internet celebrities: who will bring the goods? Where to bring the goods? Who are you bringing the goods for?
  Corresponding to this is the entire Internet celebrity economic industry chain.
  The Internet celebrity economic industry chain can be summarized as upstream supply chain, midstream platform, and downstream users. It is the differences in each link of the industrial chain that determines the status quo of the Internet celebrity economic ecology in China and the United States.
  CITIC Securities pointed out in a research report that the supply chain determines the basic lower limit of the Internet celebrity economy, while the platform determines the upper limit of the Internet celebrity economy, and profoundly affects the Internet celebrity and even the user ecology.
  And almost every link behind the industrial chain of the Internet celebrity economy in China and the United States is a microcosm of my country’s e-commerce ecology catching up with Europe and the United States.

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