Both the countertrend growth in trading volumes and the continued influx of companies and capital are painting a new and more dynamic picture of China's cross-border e-commerce retail export market. The rise of independent cross-border e-commerce sites has also provided rich soil for brand cultivation. However, it is not plain sailing for cross-border e-commerce brands to go overseas. How to achieve sustainable growth under the challenges of all parties is the bottleneck to be broken urgently.

What are the challenges?

At present, the characteristics of brands in retail export market are becoming more and more obvious, and the trend of cross-border e-commerce branding and brand cross-border e-commerce is evolving. Ebang Power observed that in terms of cross-border branding, the business development of many cross-border e-commerce sellers began to shift from shop to boutique mode, advocated branding development, and paid more attention to the study of brand building. In terms of brand cross-border e-commerce, many domestic brands actively use cross-border e-commerce to layout overseas markets, such as Lin's wood, Xilimen, Yichun and other traditional domestic brands, as well as huaxizi, Perfect Diary, Three and a half new consumer brands have entered the cross-border e-commerce to expand their overseas business.

At the same time, cross-border e-commerce retail exports are faced with low profit cycle, flow bottleneck, fault in the middle zone and other challenges, which make the industry's road to the sea full of thorns.

For now, "the industry seems to be stuck in a low-margin cycle." He Yang, chief editor of Ebang Power cross-border e-commerce, pointed out in the independent station practitioner conference that while the main cross-border e-commerce platform focuses on low-price strategy to capture cities and occupy land, the profits of cross-border e-commerce sellers are also under pressure. The company's third quarter financial results show that Anke Innovation Q3 revenue growth 22.63% year on year, net profit decreased 7.4% year on year; Le Song's Q3 revenue rose 19.97% and net profit fell 50% year on year. In their earnings reports, both companies cited higher raw material costs, higher shipping rates and increased advertising spending as the main reasons for the drag on profits. Amazon seals zebao, tree's Q3 revenue and profit are now down, platform policy adjustment and the company's business transformation is the reason for the loss mentioned in the financial results.

In terms of traffic, the platform traffic supply is insufficient, the rate of return of in-site advertising decreases, the cost of social media advertising increases significantly, and the iOS privacy policy affects the precise delivery of social media advertising... When the flow dividend fades, cross-border e-commerce sellers must hedge their rising costs with higher consumer value.

He Yang analysis pointed out that in the independent station ecology, only SHEIN can achieve the scale of annual revenue of 10 billion DOLLARS, the second echelon of revenue is mostly in hundreds of millions of dollars; In the platform ecosystem, for example, among the 2 million sellers on Amazon's US website, there are 5,500 sellers with annual sales of more than $1 million, and about 65,000 sellers with annual sales of more than $100,000. More sellers have annual sales of less than $100,000, and there are obvious faults in the middle zone.

In addition, data from Marketplace Pulse, an e-commerce research and data analysis firm, shows that in the past two years, there have been more than 1,800 products from more than 600 brands on amazon's Top100 bestseller list. "branded" products are replaced almost every day. Only Apple, Samsung, SONY, Soundcore(a brand of Anke Innovation) and Tozo(a headphone brand of Shenzhen Qianhai Wall Technology) are evergreen brands. This shows that a large number of so-called "brands" are just trademarks, and most businesses are wrapped in homogeneous products.

Where is the path?

What is the sustainable growth path of the brand?

Ebang Power combined with industry observation and warning, excessive pursuit of category dividend, no real product capacity, excessive reliance on operation means, no brand thinking, overdraw users, etc., are not sustainable development mode. The common characteristics of many successful cases are that the marketing side takes the brand thinking rather than the flow thinking, and the operation side insists on refinement and localization.

Changes in the competitive landscape among the giants brought about by the boom in independent sites like Shopify and the rise of new traffic platforms like TikTok could lead to structural dividends, He said. At the same time, in the post-epidemic era, the demand for pet products, outdoor furniture, home fitness, mobile energy storage power supplies and other categories is surging, new categories such as self-heating hot pot and floor washing machine are constantly emerging, and mature categories can continue to be upgraded with the help of functional innovation. All these opportunities are worthy of overseas businesses' attention. Looking back on the development of cross-border e-commerce, new channels and new categories can often breed new brands. The birth of Anke innovation in that year coincided with the channel promotion of the rapid rise of Amazon and the new opportunities of digital accessories category driven by the popularity of intelligent terminals around 2010.