On May 13, the interface news learned from a number of insiders that Tiktok had recently made a new round of structural adjustment. Tiktok’s real estate business “Happy Lane” and decoration business “Xiaobang” were incorporated into local life. Zhu Shiyu, the original business leader, transferred to Tiktok E-commerce to take charge of durable consumer goods business.
A person close to Tiktok Real Estate told InterfaceNews that this adjustment means that Tiktok Real Estate and Home Furnishing have changed from a primary department of the company to an industry subordinate to Tiktok Life Service.
“In line with the business logic of catering, wine travel, leisure and entertainment, real estate and home decoration are also based on geographical location, aggregating nearby goods and services to provide users.” The above people said that, in the real estate industry environment has not improved significantly in the short term, and practitioners gradually have a certain understanding of the Tiktok channel to facilitate transactions, it is a more realistic choice for Tiktok to continue to explore the real estate and home decoration business under life services.
As of press release, Tiktok has not responded to the above news.
Tiktok’s real estate business has been adjusted for a long time. Since last year, both “Happiness Village” and “Zhuxiaobang” have entered a contraction state and have successively withdrawn from offline business.
According to the interface news, in May last year, “Happy Lane” transferred more than 200 stores to Maitian Real Estate to exit the offline transaction of second-hand houses, and Tiktok’s real estate business was transformed to the CPS mode (cost per sale, an online real estate transaction sub commission mode) as a whole. In February of this year, “Zhuxiaobang”‘s self operated home decoration business “Zhuhao Home” no longer carried out new signing, but introduced home decoration companies, and the business model shifted from platform self operation to supervision.
Zhu Shiyu was transferred from Tiktok’s life service business last November, and integrated the real estate business and home decoration business into “Tiktok’s real estate and home decoration business platform”, refocused on online business, and began to pilot the CPS model in Chengdu. At the same time, Tiktok Real Estate launched the “Great House” system, claiming to enable real estate creators to more effectively achieve content acquisition, clue management and transformation follow-up.
Only half a year later, Tiktok’s real estate business underwent a new round of adjustment, and the internal staff said that the adjustment frequency was too fast.
A person in charge of an organization in Chengdu cooperating with Tiktok Real Estate CPS told InterfaceNews that at the beginning of this year, Tiktok Real Estate set a relatively clear performance target for the cooperative organization. Although Tiktok has a lot of traffic, Tiktok Real Estate belongs to a new platform, and the conversion rate is still difficult to say. Some cooperation agencies also have complaints.
In the opinion of a person familiar with ByteDance, Tiktok is a bit impatient in the real estate business. Essentially, the company faces the problem of which business has a higher ROI from Tiktok’s traffic. At present, Tiktok’s traffic has a higher liquidity efficiency in advertising, e-commerce and other businesses, which, to a certain extent, has squeezed businesses with low internal liquidity efficiency.
Usually, offline real estate agencies and decoration businesses have heavy business models, high costs, and low profit margins. After a year of hard work by business personnel, the ROI may not be positive. It is far better for platforms to directly sell this portion of traffic to brand owners or merchants in the form of information flow advertisements.
But in reality, the online real estate CPS model has a lot of room for imagination.
The person in charge of the above Chengdu organization cooperating with Tiktok Real Estate CPS said that at present, many cities across the country are entering the cycle of destocking new houses, and developers are also looking for new marketing models. Compared to traditional real estate advertising, the rich media and real-time interactive forms of video and live streaming efficiently solve the consumption decision-making problems of homebuyers, and can also break the limitations of time and space, solving the problem of cross regional home purchases. The model of live streaming live broadcasts by anchors on real estate properties helps to bridge the gap between potential customers and the properties, and increases the probability of completing conversions.
In recent years, the real estate market has undergone many changes, with a younger group of homebuyers who are more receptive to online promotion models. Live selling has become a new trend in customer acquisition.
A real estate agent practitioner from Suzhou said that there are currently over 4000 real estate agent stores in Suzhou, and real estate agents are exploring new paths. Previously, intermediaries mainly obtained customers through offline stationed, dispatching orders, and making phone calls, but now online short video, live streaming, and other platforms have also become important channels for customer acquisition.
According to the data in the 2024 Tiktok Real Estate Ecological White Paper, the number of certified accounts and contributions of Tiktok real estate developers will increase in 2023. As of November 2023, the occupancy rate of developers with the top 200 sales volume has increased to 90.9%, which is 9.2% higher than in 2022. From January to October 2023, the number of real estate creators on Tiktok will be nearly 2 million, a year-on-year increase of 159%, of which about a quarter are real estate brokers.
Kwai is the first platform to try the real estate CPS mode. According to the interface news, the Kwai “Ideal Home” has now covered more than 120 cities nationwide. In the fourth quarter of last year, the platform’s cumulative real estate transaction volume exceeded 16 billion yuan, with a total transaction volume of around 50 billion yuan in 2023 and 10 billion yuan in 2022.
In terms of growth rate, the total transaction volume of “Ideal Home” has increased five times in a year. However, in terms of the scale of new housing channel agency, its size is not large and there is still significant room for growth. In 2023, the average gross merchandise volume (GMV) of Kwai “Ideal Home” in each city will be 420 million yuan, and the number of units sold in a single city will only be hundreds.
But in the eyes of some real estate agents, there is still more room for imagination in selling second-hand houses through live streaming. At present, due to the decline in second-hand housing transaction volume, some cities have adopted the model of landlords selling houses live on their own, which not only reduces transaction links and improves efficiency, but also to some extent reduces transaction costs.
According to the observation of Interface News, some real estate tycoons have also started posting short videos of second-hand houses on multiple platforms, while also venturing into the transaction process, inviting landlords to introduce the housing situation and bargaining to a reasonable range before acting as agents for sale. If the platform intervenes in operation in the future, the transaction volume of this part of second-hand housing will also be very considerable.