Introduction Why does an obviously fake article spread widely? Why are many companies facing e-commerce with 'instinct'? Besides its destructive power, what channel dividends does e-commerce bring? An old meme: about half a year ago, an article titled "A British Comment on Chinese E-commerce: Hits the Nail on the Head" was widely circulated online. The gist is as follows. A British lord criticized Chinese e-commerce, arguing: 1. China's allowing e-commerce to develop so rapidly is a serious mistake in socio-economic management. 2. The British government and entrepreneurs are not fools; they could easily build several e-commerce platforms, but why don't they? The government restricts it, and entrepreneurs are also wise. Because the British government knows that behind a small commercial shop is a middle-class family; destroying their living environment would be a social disaster. 3. Commerce's more important role is to attract people and the public to the streets. When they search from one shop to another to buy a satisfactory piece of clothing, they are likely to engage in 'impulse consumption' far exceeding the value of one piece of clothing. For example, a couple shopping may spend on dining, may watch a movie together, and if they have children, they may buy something for the kids that they 'never intended to buy'. Conclusion: The lord believes that e-commerce is by no means a good way to stimulate consumer spending; rather, it is destroying consumption. The article was quickly debunked, so we won't tear apart its flawed logic. What interests Lao Miao is: why did an obviously 'fake article' get widely shared online? What does it reflect about people's attitudes toward e-commerce? What attitude should we adopt toward e-commerce? Let's start with behavioral patterns. We know that human behavioral patterns were established when our ancestors were on the East African savannah. When humans suddenly face the unknown entity 'e-commerce', their reaction patterns are basically the same as when our ancestors suddenly saw a dangerous unknown monster on the savannah. Behavioral scientists divide basic human reaction patterns into three types. Seeing a dangerous unknown monster, not knowing whether it is harmful or beneficial, nor whether one can defeat it, one directly picks up a stick and charges to fight the monster. This way of gaining a sense of security by eliminating the unknown is called the 'instinct center' reaction pattern. E-commerce comes, and I don't understand it! Damn, it's a flood and a beast; you sell fake goods, undercut the market, destroy consumption, hinder economic development, affect people's living standards, and it's a conspiracy of the American imperialists! I represent the people, represent the moon, and will destroy you! This is the instinct center reaction pattern. Seeing the monster, one proactively goes over to greet it: 'Hi, hello', 'Have you eaten?', 'I have braised pork here, the Chairman's favorite, want a piece?', 'Do you have a girlfriend? Let me introduce one. What do you think of Fan Bingbing?', 'If you want it, just say so; if you don't say, how would I know?' This way of gaining security by establishing a connection with the unknown is called the 'emotional center' reaction pattern. People with the emotional center pattern face e-commerce by embracing it wholeheartedly without thinking. They shout 'Internet+', 'E-commerce+', loudly proclaim 'the arrival of the Internet era and e-commerce era', and never speak without mentioning 'Internet thinking, big data, cloud computing, industrial Internet, and Internet finance'. If they don't talk about 'Internet thinking and e-commerce', they feel embarrassed to greet people. They are filled with a sense of crisis, feeling that 'transformation brings huge opportunities, and not transforming means immediate elimination'. In psychology, this is also called 'panic-driven pampering'. The last pattern is this: seeing an unknown monster, regardless of whether it is harmful or beneficial, or whether it is dangerous to oneself, one turns and runs, 'as far as thought can go, they can run that far'. This way of gaining security by distancing oneself from the unknown is called the 'thinking center' pattern. E-commerce comes, and one needs to shop online. 'Online? I haven't fished in years; I have no net.' One just focuses on doing one's own work well. Making good products, consolidating original sales channels, and stepping up efforts on original marketing paths is the 'thinking center' attitude toward e-commerce. Compared with the instinct center and emotional center patterns, the thinking center pattern is slightly better when facing e-commerce. Lao Miao has previously pointed out that our behavioral patterns originated in primitive tribal times and are often inadequate for dealing with complex current affairs. Similarly, when traditional enterprises use these three basic behavioral patterns to face e-commerce, they will also encounter embarrassment. E-commerce has entered a new stage: its retail scale accounts for over 20% of total social retail sales, and for some product categories, it accounts for 30%, 40%, or even more than half. The main shopping port has also shifted from PC to mobile. At this point, it is necessary to summarize it a bit and see what the correct posture is. Using instinctive basic behavioral patterns to face this huge and complex monster will leave you battered and bruised. The 'British lord' anecdote resonates with some people because it does reflect the 'destructive power' of e-commerce, namely, eliminating a lot of impulse purchases. In the past, we might go to a large supermarket once a week, make a list, buy eight items, and expect to spend 500 yuan; but we ended up buying thirteen items and spending 800 yuan. The extra five items and the extra 300 yuan are 'impulse consumption'. Previously, we planned to go shopping for clothes with a budget of 1,000 yuan, but came back with bags and bundles, spending 3,000 yuan. The extra 2,000 is also 'impulse consumption'. 'Planned purchase + impulse purchase' is the main consumer purchasing model in traditional offline retail. The fundamental impact of e-commerce is that it destroys the foundation of offline physical stores—the consumer purchasing model. This hurts some consumption, but it also brings greater opportunities. When we learned to shop online, we first bought clothes and books, then small appliances, snacks, and toilet paper. Finally, we found that Taobao, the all-powerful, has everything: low prices, no need to leave home, search on demand, easy returns, order with a click, and even leave good or bad reviews. It's really satisfying. As a result, the previous weekly trips to large supermarkets or periodic shopping trips gradually decreased or even disappeared. Taobao is all-powerful, but it cannot meet all our needs. For example, when cooking, we find we're out of salt, suddenly crave ice cream, or Aunt Flo arrives unexpectedly. At such times, we usually don't go to a large supermarket or go shopping; instead, we go to the convenience store downstairs. Similarly, if we have a shopping list of eight items and buy seven online, but the remaining one isn't suitable online, we often don't go to a large supermarket for it; if the convenience store downstairs has it, we'll buy it nearby. This is the new consumer purchasing model brought by the popularity of e-commerce: 'Search on demand + buy on search + convenient replenishment'. Once you understand that the consumer purchasing model is the foundation of sales channels, and understand the profound changes brought by this new purchasing model, it's not hard to understand: why large supermarkets have been declining year after year, while convenience stores are rising against the trend; why online, categories like clothing, books, leisure snacks, and health products have risen, while beverages, milk, and condiments are still less affected; why a Taobao brand or an e-commerce platform can achieve several-fold annual growth once it gains momentum. The fundamental reason behind all this is the change in purchasing patterns. The new consumer purchasing model not only eliminates a large amount of 'impulse purchases' but also brings a lot of channel dividends, namely the rise of niche products. In traditional offline channels, most consumer purchases occur within a five-kilometer business district. This determines that in a single traditional terminal, sales of a niche product will be very small, making it unable to bear terminal costs, personnel maintenance costs, and channel costs, and thus unable to survive in traditional terminals. The e-commerce model of 'search on demand, buy on search' expands the consumer's purchase radius to infinity. The previously suppressed niche demands are released, and niche products will usher in a comprehensive explosion. A friend in the cosmetics industry, after entering e-commerce, did not choose the large categories of skincare or makeup, but instead chose niche products like hand masks and foot masks as the main category. He quickly became the number one brand in that category, formed his core competitiveness, and used it to drive sales of other product items. A cutting board, the kind we usually call a chopping board, priced at 1,500 yuan each—niche enough? A public account called 'Wen Yi Home Cooking' recommended it, and in one event, 15,000 units were sold in ten minutes. That's more than the brand's annual sales in all of Asia. (Regarding how to market niche products and how to gain new channel dividends, Lao Miao will write a special article to discuss.) Previously, local specialty products faced the marketing dilemma of being unable to leave their place of origin; once they left, their local characteristics disappeared, and their marketing value was lost. The e-commerce model of 'search on demand, buy on search' also solves this problem, and many local specialties are now selling well online. (Marketing of local specialties is also an interesting topic; whether to write a special article, Lao Miao is still hesitating.) More commendably, some insightful marketers have turned some mass product categories into niche ones, i.e., so-called community-based, and then used e-commerce channel dividends to sell online, achieving great success. Who Lao Miao is referring to, I believe you know. E-commerce is still booming, and niche market demands are being fully released. The instinctive indignation, panic, and indifference of traditional marketers have no effect on it. Understanding the fundamental changes in consumer behavior brought by e-commerce, mastering the marketing rules under the 'search on demand + buy on search + convenient replenishment' purchasing model, seizing the consumption trend of niche products in time, and sharing the channel dividends of e-commerce development are our most scientific choices. Source: Lao Miao Tears Marketing (ID: yiheyingxiao) -END- The best FMCG distributor learning platform in China Dedicated to providing professional, practical, and actionable tutorials for enterprises and distributors Committed to helping Chinese FMCG distributors grow rapidly The most professional and practical knowledge base in the FMCG industry Reply with the red number below to get corresponding content Reply with number 1 to view the complete knowledge base | 001 Excellent article selection | 002 Distributor market operations | 003 Terminal visit management | 004 Sales supervisor skills | 005 Sales improvement techniques | 006 Channel expansion | 007 Managing distributors | 008 Distributor development | 009 Distributor internal operations management | 010 Team management | 011 Efficient distribution techniques | 012 Sales manager's eighteen skills | 013 KA operation methods and strategies | 014 First lesson for new salespeople | 015 Internet, brands | 016 Distributor B2B transformation | [Long press QR code to follow]