📉 First-Half GMV Performance
Douyin E-commerce reported a GMV of $193B for the first half of 2024, falling short of its $206.7B target. The second quarter alone contributed $104.7–106.1B. Despite a robust monthly growth rate of 50–70% in 2023, growth declined below 40% in March and further slid below 30% by the end of Q2.
💸 Impact of Low-Price Strategies
The decline in GMV growth is attributed to Douyin’s low-price policy. In 2023, the average transaction value was $13.8–16.5, but it dropped to around $11 in 2024, a 30–40% decrease. Douyin prioritized price competitiveness at the start of the year but had to refocus on GMV due to the rapid decline.
📊 Merchant Retention and Advertising
Low prices affected merchant retention and advertising growth. Active selling merchants' retention rate dropped from 81% at the year's start to 59% by Q2's end. Only 2M out of 4M total merchants are actively selling each month. The number of merchants advertising on Douyin is around 400,000–500,000, far from the 900,000 year-end target.
🏷️ Focus on White-Label Products
Douyin’s strategy attracted many white-label merchants, now making up nearly 40% of GMV. The target is to increase this to 44–46% by year-end. A source noted that while the proportion of white-label products is expected to rise, it will likely remain around 50% in the short to medium term, not exceeding 60%.
Will Douyin's focus on white-label products pay off?
