The 618 shopping festival has commenced, once again bringing the development trajectory of the e-commerce sector into sharp focus. Amidst a collective industry-wide slowdown in growth rates, many brands have already found themselves grappling with profitability challenges this year.
A significant shift is underway in the industry. In recent years, new models like content-driven e-commerce offered brands the allure of overnight sales explosions. However, with the escalating cost of traffic, some brands are now compelled to seek a way out of the dilemma of "selling more, losing more."
"This year, all growth for our company must be premised on profitability. We will absolutely not pursue business segments or channels that incur losses, even if they promise scale expansion," stated Sun Huaiqing, Chairman of Marubi, in a recent media interview. From his perspective, Marubi has fully pivoted towards an efficiency-driven model, "prioritizing stable growth in the more profitable shelf e-commerce platforms, scaling back loss-making business segments, and continuously expanding profitable areas."
To enhance profits, an increasing number of brands are shifting their operational focus to shelf platforms like Tmall and JD.com. Experts suggest that if brands do not begin prioritizing long-term profitability and calculating their economic efficiency, they may face significant developmental hurdles.
**Transitioning from Scale to Efficiency**
In January of this year, the e-commerce communication platform Paidai released a "2025 E-commerce Survival Survey" covering thousands of online merchants. The data revealed that 30.1% of surveyed merchants reported negative net profits, while over 30% had profit margins between 0% and 5%. Regarding the erosion of profits, 78% of merchants pointed to "high traffic costs" as the primary reason.
Revenue growth does not equate to increased profits; soaring traffic expenses are consuming brands' profit margins. "The old approach was to push products out first and figure things out later. Now, it's about calculating the numbers clearly before making a move," described one e-commerce operations manager, characterizing the current change.
It is understood that the previously prevalent, extensive strategy of first setting a GMV target and then working backward to allocate marketing budgets has been halted by some brands this year. Brands are now more focused on net profit margins after deducting returns and after-sales costs, the differences in commission rates, return rates, and traffic acquisition costs across various platforms, and whether the contribution ratio of repeat purchases from existing customers can be consistently improved.
Several industry insiders indicate that the era of traffic-driven growth is concluding, and e-commerce is entering a new competitive phase centered on customer retention and repurchase. Brands are no longer chasing one-time sales spikes but are placing greater value on whether customers return for repeat purchases.
When brands scrutinize their "efficiency accounts" down to the finest detail, all complex issues ultimately boil down to two key metrics: return rate and repurchase rate. The interplay between these two factors determines whether a brand is running a profitable business or merely generating buzz without substance. The performance of content-based models and shelf-based models also shows significant differences in these indicators.
Take live streaming as an example. Its ability to aggregate traffic rapidly and launch new products is unmatched by many other models. During the 2025 Double 11 period, the original apparel brand CHICJOC achieved over 100 million yuan in sales from a single live stream on a streaming platform, creating 23 best-selling items with million-yuan sales. Another new beauty brand, PMPM, also experienced rapid growth during the 2025 618 period through influencer live streams.
However, the challenges of live streaming are equally pronounced. According to a previous industry report by NetEase E-commerce Research Center, the return rate for live streaming models typically ranges from 30% to 60%, significantly higher than the 10% to 15% for traditional models.
Furthermore, as reported by China Central Television (CCTV) during the 2025 Double 11, for a garment priced at 150 yuan, the gross profit per item is about 60 yuan. After deducting operational costs, logistics fees, and platform commissions, the net profit is only 15 yuan. If a return occurs, the repeated shipping costs for multiple dispatches can directly consume the remaining profit.
The dual challenges of high return rates and low profit margins are causing headaches for an increasing number of brands. High traffic acquisition costs coupled with heavy supply chain burdens mean that beneath the pursuit of high GMV, the actual net earnings are minimal, posing risks of losses and making genuine sustainable profitability difficult. This is a key reason why more brands in recent years have refocused their core operations on shelf e-commerce platforms like Tmall and JD.com.
The core of shelf e-commerce lies in "certainty" and "long-term operations." Multiple merchants have noted that return rates in search-dominant shelf environments are typically significantly lower than in live streaming scenarios. High repurchase rates combined with low return rates are essential for a sustainable long-term business model. Low returns ensure each transaction generates real profit, while high repurchases allow those profits to accumulate consistently.
Pop Mart explicitly stated in its 2025 annual report that it would "strengthen differentiated customer operations in its Tmall and JD.com flagship stores." Keep shifted the focus of its fitness food product line to shelf e-commerce operations in 2025, leading to a notable improvement in its annual repurchase rate. These examples demonstrate the inherent advantage of shelf platforms in retaining existing customers and maintaining stable repurchase rates. Consequently, an increasingly common industry practice is for brands to launch new products and acquire new customers on content platforms, then guide the accumulated users to their shelf-based stores for membership retention. Simultaneously, at the platform level, live streaming platforms, known for their content strength, are also increasing their emphasis on shelf models, adopting a dual-drive strategy of shelf and content. This shift indicates that the traffic-dominated development phase is ending, and a new consensus is forming across the entire industry.
**Is Shelf E-commerce Becoming the New Anchor for 'Good Business'?**
The topic of returning to shelf platforms has gained renewed momentum with a set of latest merchant entry data.
Tmall disclosed that over 150,000 new merchants settled on its platform throughout 2025, with the number of brands achieving annual GMV exceeding 100 million yuan growing by over 40% year-on-year. From March to May this year, the number of newly settled brands increased by 30% month-on-month, and the number of new product launches grew by 33%.
The incoming brands span various segments: luxury brand Balenciaga opened its second Tmall flagship store, joining Prada, YSL, and others in adopting a "dual-store model"; traditional brand Kodak ventured into apparel, and Pien Tze Huang launched a personal care flagship store; emerging brands like "Key POINZ," Keep, and JACK & JONES are also expanding their product categories.
It is widely believed within the industry that at this stage, the platforms that can offer brands better operational efficiency will win increasing favor.
Meanwhile, according to reports from multiple media outlets, several brands have significantly adjusted their strategies for influencer live streaming investments. Many are shifting from influencer-led streams to in-store self-streaming, positioning live streaming as a tool for daily customer service and promotions rather than merely a sales explosion point. A mainstream, established approach is termed "each playing to its strengths": content platforms are responsible for new customer acquisition and brand awareness, while shelf platforms handle conversion, customer retention, and fostering repurchases.
Industry observers believe that following the peak of traffic红利 (红利 hónglì - dividend/bonus), brands are now placing greater emphasis on the沉淀 (chéndiàn - accumulation/sedimentation) of brand equity. To support long-term viability, brands need both the continuous ability to acquire new customers and the capability to retain them, fostering stable repurchases and controllable profits. Only by clearly calculating their efficiency accounts can brands potentially achieve substantive, high-quality growth in this new phase of industry development.
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