Two years ago, New Distribution classified the current market channels from two dimensions: technology and market, into four quadrants. From today's perspective, on one hand, the importance of different scenarios has changed; on the other hand, the trend of convergence among many scenarios is also very obvious. So, today we will spend some time reclassifying and analyzing the current retail market.

Consumer Behavior Today's retail channels are ever-changing, but no matter how they change, from the perspective of consumer behavior, they can be roughly divided into three types:

1. Immediate Consumption Based on the needs arising from users' physiological behaviors, users have high time sensitivity and need to get it immediately. For example, when thirsty, hungry, tired, or sleepy, they need to replenish energy immediately, and certainly cannot wait for express delivery three days later. So users generally choose to buy actively. Such products are usually single-time, small-batch, and have high repurchase frequency.

2. Planned Consumption Users have low time sensitivity and do not need to buy immediately. Users have high price sensitivity. Toothpaste, laundry powder, toilet paper, seasonings, etc., are all this type. Because of high price sensitivity, if there are cheap products, users have a habit of stocking up. The probability of wave-based purchasing is relatively high, so we see activities like Double 11 and 618, and why brands offer deep discounts for promotions.

3. Impulsive Consumption Users' impulsive purchase behavior under specific time, place, content, emotion, or scenario. In this type of behavior, users have low price and time sensitivity, random purchase is strong, and brand repurchase rate is low. Based on the above behavioral perspectives, if users have high time sensitivity for a certain type of product, they will actively find the product; if users are price-sensitive, they will calculate to find the cheapest channel across the internet; if consumers are not sensitive to price or time, we need to find ways to make users buy impulsively.

Viewing Retail Venues from the Topology Network of Four Flows Baidu Baike defines network topology structure as: the physical layout of interconnecting various devices with transmission media. It refers to the specific physical (real) or logical (virtual) arrangement among members of a network. Topology is an abstract representation method that does not consider physical properties such as size and shape, but only uses points or lines to describe the actual positions and relationships of multiple objects. Topology does not care about details or proportional relationships, but only represents the interrelationships among multiple objects within a certain range in the form of a graph. An important reason we introduce network topology into the distribution field is that the supply chain relationship from brand to consumer is no longer a simple linear distribution and transmission. Today's retail forms are increasingly complex and diverse, and cannot be displayed with a single model. Through the form of topology network, we can abstractly and intuitively see the logical relationships among the business flow, logistics, information flow, and capital flow behind retail.

From the perspective of information flow and distribution mode, it can be roughly divided into four topology modes:

1. Tree Topology Retail Network: Refers to physical retail channels, the traditional from brand to distributor to wholesale to retail to consumer. The distribution of goods gradually increases from few to many, similar to an inverted large tree shape. The brand is the chain master of the supply chain. This type of channel structure is a people-find-goods model. The advantage is ubiquity and easy access, but the disadvantage is that limited shelves lead to limited product selection and insufficient diversity. It is mainly immediate consumption, supplemented by planned consumption.

2. Star Topology Retail Network: Refers to platform e-commerce, such as JD.com, Tmall, and Pinduoduo. By building a centralized platform, they aggregate people and goods, while brands connect directly with consumers through the e-commerce platform without intermediate links, allowing direct transactions between brands and consumers. The platform is the chain master of the supply chain. The advantage of this model is direct connection with consumers, unlimited shelves, and rich SKUs. The disadvantage is the high time cost and logistics cost for delivery to consumers. This type of channel structure leads to users mainly engaging in planned consumption, supplemented by impulsive consumption.

3. Mesh Network: Refers to transaction behaviors generated on social network platforms such as WeChat. These platforms have no centralized traffic distribution, no hierarchical transaction transmission (legally prohibited), and no definite selling targets. Transactions are based on personal trust endorsement and social network connections. This type of channel structure allows brands to use the personality endorsement of social network nodes to solve the problems of deep consumer education and brand trust. It is mainly impulsive consumption, with planned consumption secondary.

4. Algorithm Feeding: Refers to interest-based e-commerce like Douyin. Douyin uses algorithms to match content with users, tags users based on their feedback on content, such as clicks, comments, watch time, and forwarding, and then feeds them content or products they like. The transaction logic is based on the match between content and users, which changes with user behavior. Therefore, expanding product coverage with impulsive consumption as the main type is an ideal transaction model.

The above four topology network transaction structures are viewed from the perspective of traffic distribution, but these four topology networks are not independent; they often coexist in many scenarios. For example, the O2O model is a typical hybrid of platform and physical retail, and community group buying is a hybrid of physical retail and social retail.

Viewing Retail Scenarios from User Behavior Mr. Liu Run previously published a diagram on his official account, using three behaviors: search, content, and social, and three dimensions: offline, e-commerce, and live streaming, to define users' 9 shopping channels. I think Mr. Liu Run divided user behavior into active purchase, content-influenced purchase, and social-influenced purchase. This is slightly different from the planned, immediate, and impulsive purchases mentioned earlier, but the results of retail classification are similar and can basically cover various retail scenarios.

People Find Goods vs. Goods Find People Today's retail scenarios are ever-changing, and it is difficult to unify all retail scenarios with one classification method. But using the logic of goods and venues commonly said in the retail industry, either goods do not move and people move; or people do not move and goods move. No matter how the "venue" changes, from the relationship between people and goods, the intermediate demand and scenario can be summarized in one word: "find." Yes, it is find. No matter what channel model, either people find goods or goods find people. But from the general trend, immediate consumption categories will still mainly be people-find-goods in the short term, that is, offline retail scenarios are the main consumption channels. However, it should be noted that this does not mean some categories do not have opportunities for planned consumption and stocking up, just like the relationship between 500mL and 2L Coke. Today, the 2L scenario has become 150mL and whole-box online shopping. Planned consumption categories will basically transition to goods-find-people, that is, find places with high traffic and try every means to persuade consumers to stock up. Impulsive consumption, from the development trend, will mainly be based on the model of matching people and goods. That is to say, in the future, Douyin, Tmall, and offline retail, these three platforms represent three retail models, and competition will be fierce. The probability of one eating the other is not high, but the three-way division is likely certain.

| Founder of New Distribution, expert in FMCG industry channels, original author of over 400,000 words of FMCG industry research articles. For communication, you can add WeChat by long-pressing. When adding, please indicate your company, position, and name.

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