Top of the Great Era

Chapter 3057: Competition to Cool Down

Zhou Buqi will only be back in China for a few days this time. In addition to temporarily replacing Zhang Yiming, another thing he has to do is to resolve the current war in online car-hailing services in China.

Competition is okay.

But the competition is too fierce.

It’s nothing for everyone to spend money to subsidize the market. If you want to change the living habits of ordinary people and break the old rhythm of life, you must take strong actions. The meaning of subsidies is to use money to fight against human nature.

  Use the mentality of being greedy for small profits to fight against the powerful inertia of life!

Without such a strategy, it would be very slow to develop the online car-hailing market.

  Taxis are fine for people who like traveling, so why should we learn new things and change our mode of transportation?

It's just that we are spending too much money now.

Even though Didi, Kuaidi and Sudi are backed by the three giants, some of them can’t stand it. Or, it’s not worth it. There’s no need to be so aggressive in the competition. What’s being exploited here is people’s desire for small bargains. A little bargain is enough. There’s no need to make up 10 or 20 yuan for one order. That’s a bit too much.

Unexpectedly, Li Yanhong also talked about radical competition.

It is placed on the search business of Baidu and Weidian.

Zhou Buqi had never paid attention to it. "Oh? Really? I'm not sure."

Li Yanhong said: "The main way to make money from search is through search advertising. Of course, the existence of search advertising will definitely affect the user's search experience. Sometimes when users search, there are several advertisements on a page. But this is a necessary way for a company to survive, especially now that Ziweixing has gone public, and it also has to consider performance and profits."

Zhou Buqi nodded. "Indeed, we do business to make money. Competitive strategies that harm others but do not benefit ourselves are bad strategies from a structural point of view."

Li Yanhong gave a thumbs up and said, "Well said!"

Zhou Buqi smiled and asked, "What happened?"

Li Yanhong sighed, "Many of Baidu's colleagues are very distressed now. They say that Weidian's mobile business is rejecting a large number of advertisements in order to compete with us for market share. Sometimes when you search, there is not even a single advertisement on the entire page."

"Oh……"

Zhou Buqi was unaware of some business frictions.

But Mr. Li was very clear about what he said from a strategic perspective, as this was the strategy he had formulated.

Not only in China, Ziweixing International also does this in overseas markets.

  There are many apps in the market with similar designs and functions. How can you defeat all competitors and become the only one that survives and dominates the market?

The traditional way of thinking is to sell products at a low cost or even lower than the cost for large-scale dumping, and then kill all competitors. After all competitors are killed, the price is slightly raised to strike a balance between monopolizing the market and ensuring that the profit margin is not too high to prevent competitors from coming back.

However, this is restricted in various countries.

This is a typical example of vicious competition.

It is different when it is covered with the cloak of the Internet. Other apps want to make money and will place a lot of advertisements in the app. If there are too many advertisements, the user experience will definitely decline and users will not like it. If an app does not place advertisements during the competition, it can greatly improve its own user experience and product competitiveness.

Others make money, but I don’t.

I only survive on the high subsidies from my parent company.

You can easily defeat your competitors.

After defeating competitors and forming user habits, start increasing the amount of advertising.

Just like the current online car-hailing war, who wants to make money? Humph! Forget about making money. Whoever gets less subsidies will lose the competition and be eliminated. Traditional taxis, squeezed by online car-hailing, are having a hard time surviving.

By limiting the placement of advertisements in the Weidian App and giving up its own profits, it will have a firm advantage when competing with Baidu.

Just like JD.com defeated Dangdang.

Dangdang's core business is books, and it makes money mainly from books; JD.com also launched its own book business, but it did not expect to make money from the book business at all, and just went in at a loss, and within a few months, it smashed Dangdang into pieces.

Li Yanhong said: "Baidu is a listed company, and Ziweixing is also a listed company. Baidu has to invest a lot of money in development every year, and so does Ziweixing. So we all need advertising, we all need profits, and we can't give up more important things because of some small competition."

Zhou Buqi joked, "Even if Weidian makes less money, Ziweixing can afford it." Li Yanhong said solemnly, "It's not about whether we can afford it, but that there is no need! Baidu also has sufficient cash flow, and many of our businesses are doing very well. If we really want to compete, Baidu will not be afraid! The final result will definitely be a lose-lose situation!"

Although Zhou Buqi disagreed in his heart, he did not provoke him any further. He smiled and said, "You have a point. I have always advocated fair competition. Especially in the domestic market, we are all friends. There is no need to kill each other. It is best to put everyone on an equal footing."

Li Yanhong was very happy, "That's how it should be!"

He was really worried about being rejected.

The reason why he asked Boss Zhou out instead of Zhang Yiming was mainly because he knew very well that even if he asked Zhang Yiming, or anyone from He Yang, Guo Pengfei, or Wang Xiaochuan out, they would definitely be rejected.

Not only will it cause loss of face, but it may also lead to intensified competition.

Boss Zhou is different.

Be more gentle in your dealings with others.

Li Yanhong said: "The competition in search has been settled, and the era of scrambling for market share has passed. Now we have entered a period of intensive cultivation, and the competition needs to cool down. If the two sides continue to compete fiercely for market share as they did in previous years, it is very likely that the already calm search market will become chaotic again. Once it is chaotic, problems will easily arise, which will not benefit anyone."

"I'll do as you say..." Zhou Buqi agreed. "You tell me what to do! How about setting a standard, for example, the advertising content of each search page cannot be less than 20% or something?"

Li Yanhong said: "About 30%. Each page usually has 10 search results, mixed with 3 ads, which is still quite reasonable."

Zhou Buqi glanced at Guo Pengfei and asked, "How is it?"

Guo Pengfei laughed and said, "I'm not too sure what's going on with the search, but... it feels similar."

"Okay, it's settled."

Zhou Buqi doesn't care about this little thing about the search business at all. Baidu has a lot of medical advertising problems, and he just needs to wait and see. He is more interested in outsourcing.

Take Baidu’s search advertising outsourcing for example.

Mr. Li has publicly said that Baidu's advertisements are very clean. Not only are there no advertisements for fake drugs, but in order to avoid suspicion, they don't even advertise real drugs.

This is the truth.

But there are still circles of outsourcing behind it.

He outsourced part of the advertising and promotion business to an outsourcing company... This is very aggressive. This kind of outsourcing company doesn't care about anything and will definitely focus on the most profitable advertisements. The most well-known one is the long-term cooperation with the Putian Group.

Once something goes wrong, at least from a legal perspective, it has nothing to do with Baidu and it is the responsibility of the outsourcing company.

Outsourcing can shirk responsibility.

When something goes wrong, they put the blame on the temporary workers. This is what everyone does from top to bottom, in all walks of life.

Outsourcing can also lead to trouble.

For example, the bank leak incident is much more serious than the malware implanted in the backend of two Baidu clients. The most that can be done by the malware is to hijack some traffic and get a little more advertising money from Baidu.

Many banks also outsource their technology operations.

There are so many cases of malicious codes and malicious loopholes being implanted. The information of hundreds of thousands or millions of people is leaked at any time, and it is all bank information. It is clear at a glance who is rich and who is poor.

Once this type of information is obtained by many criminals, they can target and defraud people precisely.

Zhou Buqi wants to ask Mr. Li for advice.

This time Baidu encountered an incident of outsourcing insiders. On the surface, this is an individual problem and the responsibility of the insider. But in fact, whoever has the power should bear the responsibility. This must be a problem with some internal processes and systems of the company.

Zhou Buqi can take this opportunity to learn Baidu's rectification strategy and then optimize it on Ziweixing.