Douyin Supermarket Fully Launched After JD.com, Tmall, and Meituan, Douyin has also joined the "supermarket" fray. Recently, the "Douyin Supermarket" business officially launched nationwide. Users can find this new shopping entrance by searching "Douyin Supermarket" in the Douyin search bar or mall interface. (Screenshot from Douyin Supermarket) Although it is a shelf-based e-commerce like Douyin Mall, being a "supermarket" naturally has its differences. After trying it out, it's clear that Douyin Supermarket's products mainly include household daily necessities, snacks and local specialties, grain and oil seasonings, beverages and dairy, household cleaning, and beauty and personal care categories, all with high immediate demand. During the Spring Festival, Douyin Supermarket joined the "No Break During Spring Festival" initiative. Since it is directly shipped by Douyin, both product quality and delivery speed are well guaranteed. Thus, Douyin Supermarket can be seen as an important supplement to Douyin's e-commerce ecosystem. In fact, as early as October last year, Douyin Supermarket piloted in four cities: Guangzhou, Shenzhen, Huizhou, and Dongguan. At that time, the supermarket section was embedded directly in the Douyin Mall interface, allowing users to quickly find the entrance. In terms of logistics, Douyin Supermarket cooperates with SF Express, which provides warehousing and door-to-door delivery services. Some products can achieve "next-day delivery" at the fastest. In November last year, Beijing Zitiao Network Technology Co., Ltd. applied to register the "Douyin Supermarket" trademark, with international classifications for advertising sales and education entertainment. (Screenshot from Tianyancha) Now that Douyin Supermarket has officially launched nationwide, it may indicate that the early pilot achieved satisfactory results. The more noteworthy question is: How competitive is Douyin Supermarket in the industry?
Douyin Supermarket Learns Three Tricks from JD.com If we were to find a "reference" for Douyin Supermarket, JD.com would be the most suitable. From the current promotional points of Douyin Supermarket, there seem to be shadows of JD.com. First is the business model. Douyin Supermarket is platform self-operated, with products gathered in the warehouses of partner SF Express and then shipped directly by the official platform. The benefits of self-operation have long been validated by JD.com: since the platform controls the entire shopping process, consumer experience is greatly improved. For example, users can buy everything in one stop, and after-sales services like returns and exchanges are more comprehensive. Douyin Supermarket offers an "Anxin Purchase" service for self-operated products, including shipping insurance and 7-day no-reason returns. It also has a dedicated "Supermarket Customer Service" to better connect with consumers. However, due to the relatively high cost of the self-operated model, Douyin Supermarket, like JD.com's self-operated, sets a higher free shipping threshold to increase average order value. On JD.com, most self-operated products require a minimum of 99 yuan for free shipping; Douyin Supermarket requires 88 yuan. (Screenshot from Douyin Supermarket) Although Douyin Supermarket's free shipping threshold is relatively lower, for orders that do not meet the threshold, Douyin Supermarket currently offers no other free shipping channels except for first-order free shipping for new users. In comparison, JD.com offers free shipping coupons without threshold through "PLUS Membership" and other means. Perhaps "membership system" will also become one of Douyin Supermarket's future directions. Second is product quality. Like JD.com, another advantage derived from self-operation is "genuine product guarantee." The platform can better control product sources and avoid counterfeit or shoddy products as much as possible. From the consumer's perspective, self-operated products have platform endorsement, making purchases more reassuring. Since the launch of Douyin's shelf-based mall, we can see it has successively introduced sections like "Global Purchase" and "Brand Pavilion," all with "genuine product guarantee" as the main selling point. For e-commerce platforms, the importance of "genuine products" is undeniable. Only by building sufficient credibility through product quality can they attract a continuous stream of consumers. (Screenshot from Douyin Mall "Brand Pavilion") To this day, JD.com's self-operated business has a large number of loyal users, inseparable from its years of credibility built on genuine products. In this regard, Douyin e-commerce still has a long way to go. Finally, logistics and delivery. Besides the genuine product guarantee, JD.com's self-operated is most praised for its delivery efficiency. Douyin Supermarket, also in self-operated mode, focuses on supermarket products with immediate demand, so it cannot afford to be held back by logistics. We know that JD.com's self-operated success largely relies on JD Logistics. Founded in 2007, it only achieved full-year profitability in 2020, with cumulative losses of 8.5 billion yuan over more than a decade. But the final result proves that all efforts were worthwhile. Today, JD Logistics not only synergizes with JD.com's self-operated products but also continuously increases the proportion of external revenue, becoming a trump card for JD.com. So will Douyin e-commerce embark on building its own logistics? It's difficult. On one hand, building self-operated logistics requires large investment and takes a long time. As Liu Qiangdong once said, no matter how much money you have, it takes at least five years to build a logistics system covering 500 cities nationwide. On the other hand, the logistics market is already saturated, and even if Douyin enters, it will be difficult to expand outward in the future. At an employee meeting in August last year, ByteDance CEO Liang Rubo said that future projects will be measured by higher ROI standards to determine whether they are worth investing in. In the current context of Douyin's overall "de-fatting and slimming," the ROI of building self-operated logistics is clearly too low. But Douyin Supermarket needs efficient logistics, so Douyin can only turn to SF Express. If we only talk about delivery speed, SF Express is certainly in the first tier of the logistics industry. But even SF Express finds it difficult to achieve "next-day delivery" in most cities like JD Logistics, because it also requires coordination from the e-commerce platform. Currently, most products on Douyin Supermarket are labeled in four categories: "Next-day delivery," "Second-day delivery" (delivered the day after tomorrow), and "Same-day dispatch," "Next-day dispatch," with "Second-day delivery" being the most common. In other words, Douyin Supermarket can currently only guarantee delivery within 48 hours. (Screenshot from Douyin Supermarket) Of course, this may also be affected by the difficulty of courier companies resuming work after the Spring Festival holiday. But for an e-commerce platform like Douyin Supermarket that meets consumers' immediate needs, even if mid-to-long-distance delivery is fast, it is still not the optimal solution. In this regard, Douyin Supermarket still needs to learn from JD.com—not building its own logistics, but optimizing warehouse layouts in various cities and exploring instant delivery. The "speed" of JD Logistics is mainly because it predicts and uses big data to analyze user demand. Then it optimizes warehouse layouts and allocates inventory. In terms of algorithms, Douyin has an advantage. The most important thing going forward is to deepen cooperation with SF Express and rationally utilize its warehouse resources. On the other hand, Douyin has prepared multiple instant delivery partners for its "to-home" business, which may also become a major boost for Douyin Supermarket in the future. Once these issues are resolved, Douyin Supermarket's competitiveness should not be underestimated.
E-commerce Platforms Battle in "Supermarkets" Now, major e-commerce platforms are eyeing the "supermarket" cake. For traditional e-commerce, the delivery time for daily necessities, FMCG, and fresh products has always been a problem. The online supermarket model can make up for this shortcoming. For example, JD.com and Meituan's supermarkets, benefiting from their own instant delivery teams, can achieve the fastest "hourly delivery"; while Tmall Supermarket, based on its warehouse layout in various regions, can also achieve the fastest "half-day delivery." (Screenshot from JD Supermarket) Compared with them, Douyin Supermarket is still a "newcomer", and the fastest "next-day delivery" has no advantage. Even so, supermarkets are still something Douyin must do: On one hand, to expand categories and meet users' differentiated needs. Douyin e-commerce initially focused on short video/live streaming e-commerce, but both models share the problem of high inventory and low SKU. This is why Douyin built a shelf-based mall, integrating product resources while improving the platform's search ecosystem. However, some FMCG with high immediate demand do not fit Douyin's recommendation algorithm, yet they have a huge market. Therefore, Douyin has to personally enter the self-operated supermarket business to meet users' differentiated needs. On the other hand, it is also to explore new possibilities. In fact, Douyin Supermarket is more similar to Tmall Supermarket than JD Supermarket. Because the former is mainly self-operated, with products gathered in warehouses and then sorted and delivered; the latter relies on third-party supermarket resources and uses instant delivery teams to take orders and deliver. Thus, to improve the supermarket business, Douyin Supermarket has two paths: one is to learn from Tmall Supermarket, using SF Express warehouses for inventory allocation and then SF City Express for delivery; the other is to learn from JD Supermarket, incorporating local supermarkets into the "to-home" business of life services, and then delivering through third-party platforms. Given that Douyin Supermarket has already made self-operated products its main battlefield, it is more likely to choose the former path. But it does not rule out the possibility of Douyin entering instant retail, after all, "group buying delivery" similar to food delivery is already in pilot, and Douyin's instant delivery resources are relatively sufficient. In addition, at the end of last year, Beijing Wumart Supermarket conducted an experiment on Douyin: after Beijing users placed orders in the live room, local stores would pick, pack, and deliver, achieving one-hour door-to-door delivery. If Douyin can further explore the integration of live streaming e-commerce and instant retail, it might even open up a brand new path for online supermarkets.