In December 2019, my favorite Hackathon submission came around. In two days, I rallied four team members from client engineering, design, and merchant communications to join me in this journey. We explored the untapped potential of promotions and created a new experience to empower sellers to customize promotions in Wish's marketplace.
This project won first place from 30+ submissions across all teams. The most rewarding news was the idea got planned into the product roadmap, and made its way to customers. How did all of this happen? Let's take a look!
Product design (Lead)
Chenghan (Hank) Ke (Product design), Ruika Lin (Merchant communications), Sola Ogunsakin (Engineering)
Pitching presentations, designs, & viable prototypes
Promotion codes rooted deeply in the niche market that led Wish to success. As one of the most downloaded shopping apps worldwide in 2019, the Wish mobile app is known for its low-priced products and year-round promotions.
If we look deeper, the existing promotions on Wish are site-wide. Third-party sellers on Wish don't have an option to create their own promotions. Why is that?
Wish's commission-based revenue model profits from sellers who generate sales from products. In most cases, the regular commission rate is 15%. This rate powers the platform to gain 15 cents from every product sold at $1. Doesn't sound much. However, the number of magic compounds when there are 1.8M+ products sold per day and 150M+ products listed for exchange on the platform.
In other words, this revenue model dominants how the platform approaches promotions and discounts, as passing savings on to customers will reduce the likelihood of scaling profitability. However, from the third-party sellers' perspective, are they willing to lower profit margins to gain more customers?
The most successful third-party sellers on Wish own enormous product inventories. As of December 2019, among the top 10 sellers across the globe, on average, each seller owns more than 5,000 products.
Besides blockbuster products that return the most promising sales, the majority of the products in stock have extremely low visibility. It implies that customers rarely discover these products, not to speak about reaching a purchase decision after weighing various facts.
If sellers can create their own promotions and put products on sale, low-priced products are more likely to get customers' attention from Wish's discovery-driven shopping feed and get converted to an actual order. The more promotions a seller offers in one store, the more products are likely purchased in one order (cross-sells). In business terms, sellers can achieve a higher Average Order Value(AOV).
As much as third-party sellers value product impressions (numbers of views), they have to run ads on Wish to compete with other sellers. New sellers need to spend thousands of dollars to win a seat at the table, while they are subject to uncertainties as established sellers receive free impressions based on their outstanding sales performance.
What's worse, during non-holiday seasons, impressions do not convert to sales reliably. Navigating the flood of variables, promotions and discounts are more reliable. Most customers will happily pay $0.50 to buy a product that values $5. For sellers who profit from bulk and recurring purchases (such as selling consumer goods), a promotion is less risky and can go a long way.
Wish has grown a unique customer base that stands out from other commerce platforms such as Amazon, eBay, and Etsy. Third-party sellers who look to sell products to this unique customer base can tap into this space, and find customers who enjoy discounted products and spend weekly allowances on hedonic purchases.
At its core, the new experience of seller-controlled promotions is about customization. The design intention is to give sellers full control over their discount strategies and mitigate platform mediations.
I borrowed the physical form of a discount code and applied this metaphor to the digital experience of connecting a seller and a shopper. My design goal is to carry a sense of fun, and a lighthearted human touch along with a numeric discount. The savings are real. It's a sweet giveaway from a store owner, rather than an algorithmic platform calculation.
In this experience, I sprinkled tips to boost sellers' confidence in creating unique discounts. They will stay informed that their great attempts will be rewarded with more sales, higher-valued orders, and happy returning customers to grow their business.
"Create a promotion code" banner
Briefly speaking, promotion codes will live in a close-ended loop. They are initiated by sellers and received by shoppers. To facilitate a transaction, Wish will help sellers generate & publish promotion codes, and engage shoppers to apply promotion codes in their shopping experience.
Sellers can opt into the promotion journey from multiple touch-points, such as communication emails, in-app notifications, and the existing advertising feature "ProductBoost" that they are already familiar with.
During the journey, sellers can explore various options to customize a promotion code. One unique differentiator is that promotion codes will be configured based on monetary values, rather than percentages (%).
This is because the majority of Wish's sellers are based in mainland China, where the notion of promotion is perceived as a "Spending" model.
For example, most promotion messages are translated to "Spend 80% on its original price", versus "Save 20% on its original price" for customers in the United States and Europe ("Saving" model). Therefore, a numeric budget to "give away" makes the most cultural sense, as it's perceived universally as a "deduction".
After the promotion code is created, sellers can visit their promotions, make edits, and allow promotions to expire after a few days. These small post-editing tools come in handy during Black Friday, Cyber Monday(BFCM) when sellers are swamped by packing products and shipping them out.
As for shoppers, they will find promotion codes in their shopping feed, as well as on an individual product detail page. We introduced a one-tap "claim" interaction to make it a bit more fun, so shoppers are more committed to using those promotion codes later.
From their shopping cart, promotion codes will stay visible throughout the checkouts. With stores that require minimum purchase amounts, shoppers will find a little nudge on how far they are away to be eligible for applying promotion codes. They can "add more items", or visit the seller's store to find more products.
To edge-find how much of this new experience can become real, the most important factor we have in mind is logistics. The shipping cost of a product can be a killer to profitability, considering most of Wish's products travel across continents and borders.
Fortunately, Wish has its own end-to-end logistics solution to support this new experience. If a customer buys multiple discounted products from a store, these products will be combined-packaged from a domestic warehouse in China, and shipped in one package that arrives 2-3 weeks later - no extra cost created to support the new experience.
The pitching day was nerve-wracking, exciting, and memorable. I was on a research run in warehouses, and my design colleague Hank courageously took the torch and presented our idea in the headquarter office. The Hackathon committee, as well as the audience, loved the idea. Many questions popped up, and we had to take some discussions offline.
A few months later, this idea became a testing experiment for UK-based customers. Today, it's part of Wish's shopping experience.
A year back to reflect on the learnings we had, it was not the spotlight, but the two late nights we pulled together. We didn't have time to conduct solid research, run tests, and build everything to its finest detail. Instead, we focused our attention on what a seller and a shopper would love to see. The fact that we can make an idea happen in such a limited time, encourages all of us to form formidable changes and deliver new experiences.