---
title: "The New E-commerce Ecosystem: Should Distributors Enter Douyin E-commerce?"
description: "Recently, many distributors have asked New Distribution whether they should enter Douyin e-commerce live streaming and invest in short videos. Amid repeated pandemic outbreaks and sluggish business, they wonder if they should seek online growth. This article explores the phenomenon and trend of e-commerce migration, the logic of interest-based e-commerce, and provides insights on product selection and scenario development, based on an interview with Gu Xiangshuai, head of brand e-commerce at Mingzhi Huatong."
author: "田静"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2022-09-06"
language: "en"
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# The New E-commerce Ecosystem: Should Distributors Enter Douyin E-commerce?

> Recently, many distributors have asked New Distribution whether they should enter Douyin e-commerce live streaming and invest in short videos. Amid repeated pandemic outbreaks and sluggish business, they wonder if they should seek online growth. This article explores the phenomenon and trend of e-commerce migration, the logic of interest-based e-commerce, and provides insights on product selection and scenario development, based on an interview with Gu Xiangshuai, head of brand e-commerce at Mingzhi Huatong.

Recently, many distributors have asked New Distribution:
Should we enter Douyin e-commerce live streaming?
Should we invest in short videos?
With repeated pandemic outbreaks and sluggish business, should we consider seeking online growth?
Seeing these questions reminds me of an interview with a distributor last year, where I asked the same question: Why not do Douyin e-commerce? He replied: It's too costly; if the brand doesn't subsidize, I won't consider it.
This is a microcosm of some distributors, while others are eager to try, hesitating at the crossroads of doing it or not.
To this end, we interviewed Gu Xiangshuai, head of brand e-commerce at Mingzhi Huatong, whose team has provided live streaming agency services for brands such as Yan Zhi Wu, Junlebao, Feihe, Xiaoguancha, and Beihai Ranch, covering industries including food and beverages, beauty, daily care, and apparel. From initial exploration to breaking through traffic circles, they have helped multiple FMCG brands achieve a 0-to-1 leap (the interview content involving Mingzhi Huatong only represents the personal views of the service provider company).
**01 E-commerce Ecosystem Migration: Phenomenon or Trend?**
Mr. Liu Run refers to traditional search e-commerce represented by Taobao as a "funnel," and interest-based e-commerce represented by Douyin as a "snowball."
Obviously, the former transactions occur in the "search box" of traditional e-commerce: "I buy what I lack," moving down the funnel with clear needs; without needs, there is no transaction. The "funnel" path from "traffic → conversion → retention" becomes increasingly narrow, with a visible ceiling.
The latter transactions occur during aimless browsing on interest-based e-commerce, where a video suddenly triggers interest and stimulates potential needs. After watching a short video completely, if there are comments, likes, shares, or even orders, Douyin's algorithm tags you and will continue to push similar content based on your preferences and tags. Meanwhile, as more people watch and interact with the video, it expands outward in circles, like a snowball rolling bigger and bigger.
Invisibly, Douyin's interest-based e-commerce model forms a positive feedback loop "snowball" model. Like a trigger device, when a video touches an interest point, it amplifies infinitely.
So whether for distributors or brand owners, when offline advertising revenue approaches its ceiling, leveraging Douyin e-commerce's logic of delving into user needs—including interests, emotions, and psychology—becomes crucial.
Then, from the perspective of consumer demand, can distributors enter Douyin e-commerce?
We all know that the current market poses great challenges, and it's hard to see another company relying on a big single-product strategy like Coca-Cola, Wanglaoji, or Liu Ge He Tao.
As soon as an innovative category appears, followers swarm in, such as Genki Forest's sparkling water, which fell from grace within two years.
That is to say, the leading time brought by "category innovation" is getting shorter, consumer needs are harder to grasp, "demand cycles" are shorter, and "demand types" are more fragmented.
**As demand iteration accelerates, product life cycles shorten, new categories constantly become old, and traditional business models begin to weaken.**
How to awaken?
 _1. New demands emerge in old categories;_ _2. New technologies solve old pain points;_ _3. New experiences are played out in old categories._
These three profound insights of "old and new alternation" extract new demand formulas with a linear logic, uncovering new business opportunities. This growth logic coincides with Douyin's interest-based e-commerce logic.
For distributors, entering Douyin e-commerce means entering a new growth space, finding new consumer groups, and gaining new increments.
**02 Scenario Development: Increment Shifts Online**
New people and new increments come from new consumption scenarios.
Gu Xiangshuai mentioned, **"We focus on how our people should present the product, how our scenarios make users willing to stay and watch more, and how our goods can make customers purchase and stimulate them. This is our Douyin 'people, goods, and scenarios'."**
The "people, goods, and scenarios" mentioned by Gu Xiangshuai is taken to the extreme in Douyin e-commerce.
For example, during the service for Beihai Ranch, Mingzhi Huatong shot a short video case: a cup of Beihai Ranch yogurt, two eggs, a spoonful of starch, put into an air fryer, and after 20 minutes, it becomes a delicious weight-loss meal;
Another video: a box of Beihai Ranch pure milk, poured into a boiling spicy hot pot, stirring continuously, the color gradually turns milky white, looking rich in milk flavor, healthy and nourishing, greatly stimulating appetite.
These two scenario extensions redeveloped a new demand for the milk and yogurt categories, specifically a "concrete" demand. The biggest advantage is focusing marketing firepower; different scenarios serve the same group of consumers, equivalent to making the business deeper and more refined.
This is a strong barrier for Douyin e-commerce. With 5G technology support, short videos and live streaming have become the most intuitive and fullest means of displaying the world. Video's ability to summon interest, emotion, and psychological needs is several dimensions stronger than text and images. Based on user interest, it has achieved a leap from "goods finding people" to the integration of "people finding goods" and "goods finding people."
For distributors or brand owners, the Douyin platform is a communication carrier, and short videos or live streaming are marketing methods. Communication carrier + marketing method = Douyin e-commerce, i.e., a marketing system, a system for discovering value, creating value, disseminating value, and delivering value.
Unlike the early era of mass communication, where a single big product could achieve mass distribution by heavily advertising on TV, we have now entered an era of diversified communication. Many distributors ask: Is the market really saturated? Where have consumers gone?
Diversified communication channels form multi-channel purchase paths: offline there are supermarkets, convenience stores, and mom-and-pop shops; online there are traditional e-commerce like JD and Tmall; interest-based e-commerce like Douyin, Kuaishou, and Xiaohongshu; and even community group buying and instant retail are vying for a share. Consumers are dispersed, and major distributors are in a stock-grabbing competition. Offline is certainly the basic market, but it must be admitted that online increments remain an important part that cannot be ignored.
Therefore, the rise of Douyin interest-based e-commerce has, to some extent, caused a "great migration of users."
**03 Product Selection Logic: Brushing Fun into Users' Minds**
"Great migration of users" is a very interesting phenomenon.
There is always a group of people "migrating up and down": with the internet explosion, they migrated from offline to online; after online traffic peaked, they migrated back offline; when the blue ocean of interest-based e-commerce became clear, they returned again.
When an ecosystem is developing and maturing, it cannot be ignored and must be participated in.
But indeed, many distributors and brand owners have tested the waters, stepped in, felt the cold water, and pulled their feet back.
Why is the water too cold?
Is your product suitable for Douyin?
This is an entry threshold. To cross it smoothly, first assess whether you are suitable.
In the interview, Gu Xiangshuai mentioned that a very successful case for Mingzhi Huatong was Junlebao, with a single live streaming GMV of 400,000 yuan and an average monthly GMV of 3 million yuan.
This was Mingzhi Huatong's initial product selection logic: brand power brings its own traffic, user awareness is high, no secondary market education is needed, and both voice and sales start relatively high.
But brand is not an absolute guarantee. Gu Xiangshuai said that in consumers' eyes, product quality is the most important, followed by overall cost-performance ratio, and finally appearance, i.e., product packaging.
Quality and cost-performance are unquestionable, and **packaging design may be the most likely to trigger interest for Douyin e-commerce users.**
After all, the information conveyed by video content and image content is not on the same level. In video format, packaging design is the first thing that reaches consumers' eyes. Offline, more brands focus on expressing category value; interest-based e-commerce should consider brand recognition and user experience more. This requires teaching users to recognize the product through packaging design, so it is essential to pay attention to brand recognition and unboxing experience, to brush a product, a store, and a kind of fun into users' minds.
Then, in the FMCG field, what categories are suitable for Douyin? We distinguish from several dimensions:**
**High-heat products**: Best-selling products that many influencers sell; everyone is promoting them, indicating high demand and existing market awareness, such as well-known brands and viral hits.
**High-density products**: That is, high-frequency products like food and daily chemicals, with large category capacity, high consumption frequency, and broad user concentration.
**Strong-attribute products**: Products with strong seasonal or festive attributes, such as traditional Chinese festivals like Mid-Autumn Festival and Spring Festival; annual events like the back-to-school season in March and September; products with strong symbols.******
**Essential products**: Essential products have high demand, high conversion rates, intuitive user needs, and high repurchase rates, making them easy to sell out.
**Personalized products**: For example, some segmented products, like laundry detergent: underwear-specific detergent, sportswear-specific detergent, transitioning from mass to niche and personalized needs, creating personalized products.
So when distributors are still hesitating, they might as well benchmark against these. From watching to entering, more and more distributors and brand owners are joining because wherever consumers are, we go.
In May this year, Douyin e-commerce President Wei Wenwen proposed "full-scenario interest e-commerce," with the core purpose of covering all user scenarios based on exploring user interests, meeting full-chain shopping needs, and better serving their daily shopping needs.
**The development of Douyin e-commerce is clear: based on user interest, it has achieved a leap from "goods finding people" to the integration of "people finding goods" and "goods finding people."**
So, choice is more important than effort. Currently, Douyin e-commerce still has traffic; seizing its exposure traffic may not disappoint the dividend.
**Final Thoughts:**
**Times are constantly changing, and every ecosystem migration requires a certain trial-and-error cost, which is a test for every enterprise.**
Mr. Liu mentioned a viewpoint: an innovative model, under the hype of capital and media, quickly becomes a hot trend and reaches a climax; when you are ready to go all in to catch up with the "trend," the business model quickly falls into a "trough" and is completely denied; when you are desperate and give up, after a while, the new model unexpectedly revives; when you observe cautiously and wait patiently, new leaders have already emerged, and the opportunity is gone.
This is an era where hard work pays off, but also an era that requires **insight, thinking, and deep practice.**
 _PS: If you are interested in Douyin e-commerce topics, you can scan the QR code to apply to join the New Distribution "Douyin E-commerce Exchange Group."_ _


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