Sheln’s global search volume has exceeded that of the largest fast fashion women’s clothing in the United States. Among the brands of cross-border e-commerce exporting women’s clothing, I dare not say that SheIn is the largest seller, because there are even bigger sellers, but in terms of a single brand, it is the largest e-commerce company with a single brand. SheIn has proved that it is possible to successfully expand on a large scale by focusing, not expanding categories and SKUs, and not compromising on quality.
Currently, Sheln is almost the only APP in the cross-border e-commerce industry that exists in the form of an independent B2C. Two or three years ago, many big sellers wanted to eat up this APP market. But now it seems that SheIn is the only one that operates independently in the form of an APP, ranking in the top ten in the United States, second only to Wish and AliExpress, and in the top five in Europe. Including the APP, there is also the so-called mobile site, and SheIn’s mobile terminal actually contributes half of SheIn’s turnover.
So why does it seem that only Sheln has eaten up the APP cake at present? First of all, there are many difficulties and problems in making APP. The first is that the cost of APP development is very high. Sheln now has a team of nearly 30 people on the front end of the mobile terminal. The monthly development and maintenance costs may be around 500,000. In a year, the development cost is very high. The second is that the promotion cost is very expensive, comparable to the housing price in Shenzhen. Its ROI is difficult to exceed 8%, and the conversion rate, word of mouth and retention are difficult to control. For clothing and electronic products, whether the ROI can exceed 3% is the life and death line. If it exceeds 3%, you can continue to do it, but if it does not, you will go bankrupt. The promotion of APP basically relies on Facebook. In the United States, it may cost about 3 US dollars for one download, which means that the traffic fee is 3 US dollars, the conversion rate is 1%, and one hundred clicks make one transaction. No one can continue to do this. SheIn has achieved a single user acquisition cost of 1 to 1.5 US dollars, and most of the ROIs are hovering around 2%. It can achieve an ROI of more than 5%, which is a very good project.
The promotion cost is so high and the user activity is so difficult to control, which determines that the promotion of APP must be done to the extreme. So how to achieve the extreme? Most people use hot products to advertise. They upload pictures first, then test and optimize, and spend money on the best performing ads. This is a wrong approach. If advertising is so simple, everyone can do it. What is the right way? Now everyone talks about bidding, ranking, account operation, and finding the direction for advertising. I think you can forget these things first. The biggest experience I gained from starting a business is not to do these things. If your ad performance is not good, 90% of the time it is a problem with the picture, especially on Facebook mobile terminals, which basically displays that picture. If the picture is OK, 90% of the time it is a problem with the selection of the model.
The content of the ad is the content of the picture, and you have to keep exploring. Since you can’t use hot products for advertising, what should you use? Use quasi-hot products. When using hot products to make pictures, the click-through rate is 1%, and when using quasi-hot products, the click-through rate is about 3%.
SheIn has been constantly exploring the form of advertising. In the early days, it was also a hot product. The price was marked “$1” in the upper right corner of the picture, and “30left” in the lower right corner. This kind of advertising actually performed very well. However, Facebook and American fashions update very quickly, so we had to study the form of advertising. So we changed the form of mainstream advertising, and at the same time, I can ensure that all clothes are the quasi-hot items of the season in the United States, and are fashionable. Then there is the picture matching. Instead of using a computer to piece together pictures, we take pictures, find the SKUs from the warehouse, and then put them on the ground to match them, and take pictures one by one. There are thousands of ads running at the same time every day, so SheIn actually invests a lot of money in advertising. Not only matching, but also backgrounds, makeup, models, and the latest accessories. SheIn currently has the ability to shoot advertising pictures, and will update them regularly.