Internet Business Thinking

Chapter 31 Internet people who can’t do marketing are not good businesses (1)
(Section [-]) With the rapid influx of peers, how do we stand out?

Internet services are transforming into everyday life, and the real economy is transforming into the Internet.How should traditional enterprises respond to the general trend of data marketing?Jack Welch suggested that traditional enterprises should be good at using Internet data to obtain the fastest insights and problem-solving perspectives in multiple fields such as operations, management, and marketing.

In the future, most traditional Chinese enterprises will face enormous growth pressure.Because the demographic dividend disappears, companies can no longer rely on scale growth to maintain sustained profit growth; at the same time, with the advent of the digital age, companies can no longer rely on traditional operating methods to adapt to the new business environment.Under the two core challenges, how should Chinese enterprises go in the future?
On April 2013, 4, Jack Welch, the former chairman and CEO of General Electric (GE), visited Shenzhen and had a peak dialogue with Liu Shengyi, Senior Executive Vice President of Tencent and President of the Internet Media Business Group. The former is a world-class traditional enterprise. Benchmark, the latter is the leader of the new type of enterprises in the digital age - the dialogue directly faces the two core challenges of Chinese enterprises, and discusses the digital transformation of future business.

Digitization of the business environment

After the demographic dividend disappears, how can enterprises adapt to the new business environment in the digital age?Jack Welch believes that with the continuous penetration of Internet influence, the market changes faster and traditional channels are facing reform.The Internet is a very good tool. The use of Internet data allows managers to maintain a different perspective on management and development.

In response to the question of "how will Tencent respond to the disappearance of the demographic dividend", Liu Shengyi introduced Tencent's three major response principles.

Principle one, less is more.Tencent should start to examine itself and focus on areas with real core competitiveness.

Principle two, be bold and innovative. "Three cobblers are the best Zhuge Liang", this is the core logic of Tencent's open platform, which constantly encourages elite talents to innovate together and seek win-win results in the most open way.

The third principle is to create a pleasant product experience.Persevere in improving the quality and height of products and services, so that each product has the best customer experience.

As for why enterprises enter the era of big data, Liu Shengyi believes that the following three points are very important factors.

First, the development of IT technology and the construction of enterprise informatization allow enterprise managers to find the data of many user transactions;

Second, due to the rise of the Internet, especially social media, Internet companies can accumulate a lot of user behavior data, relationship data, and UGC (user-generated content);
Third, the widespread application of the mobile Internet generates a large amount of location data, and through the mining of these data, precise marketing can be achieved.

Data is changing the business environment of enterprises, and the way of enterprise management is bound to be innovated.As Liu Shengyi said: "Internet services are being transformed into everyday life, and the real economy is being transformed into the Internet."

From making scale to making high-quality goods
The arrival of the era of big data is irreversible. In the face of change, how should traditional enterprises respond?
Jack Welch suggested that traditional enterprises should formulate a three-in-one strategy from three aspects: development, technology and data.We must be good at using Internet data to obtain the fastest insights and problem-solving perspectives in multiple fields such as operations, management, and marketing.

For the impact of digitalization on business, Liu Shengyi interpreted it from the three core business links of the enterprise:
In research and development, it is necessary to make better use of the opportunity of big data for user insights.In the era of big data, the ability to acquire and utilize data is the new competitiveness.

In terms of production, user-led production methods such as social media collaborative production and 3D printers have brought great challenges to traditional manufacturing, and all enterprises must start looking for solutions.

In terms of marketing, digital media has completely overturned the rules of traditional marketing, and marketing has shifted from brand-oriented to ROI-oriented.

It can be seen that the product strategy innovation of enterprises must integrate more digital thinking, and shift from the pursuit of scale to the pursuit of high-quality goods.

Taking Tencent as an example, Tencent.com, Tencent Weibo and Tencent Video integrated cross-platform products in 2012 to achieve "high-quality content and simplified form", which drove the development of online advertising business from user scale effect to user personal experience.The financial report shows that in 2012 Tencent's online advertising revenue reached 33.823 billion yuan, an increase of 69.8% over the same period last year, and the revenue growth rate exceeded the industry average.

From buying ads to buying users
For traditional enterprises, no matter how large they are, whether they produce high-quality goods or mass-produced popular products, their product business is inseparable from the model of purchasing media for promotion and sales.However, the turbulent tide of digitalization is forcing enterprises to turn to the digital marketing model.

So, how do companies do digital marketing?Liu Shengyi's suggestion is: personalization of media procurement, media-rich advertising performance, and offline marketing model.

Personalization of media procurement can be understood as media procurement should move from "buying media" to "buying users". "Marketing ideas need to change from media-centric to 'personalized marketing' represented by ADX." According to research on ADX in the United States, this is about 2 times more than the traditional advertising CPM profit margin.

To put it simply, the expression of rich media in advertising is to drive the creative expression of advertising through technology.For example, the new Beetle advertisement in 2012 used augmented reality technology to allow the audience to see the 3D new beetle image outdoors, and displayed the virtual new beetle special effects car skills on outdoor billboards several floors high.

The marketing model goes offline, that is, bringing online consumers to physical stores, paying for offline goods and services online, and then enjoying services offline, realizing a closed-loop marketing from advertising to sales.

Digital marketing not only brings about the online revolution of traditional retail stores, but also begins to reshape the brand's data marketing thinking.

(Session [-]) Only fast is not broken: one hour home delivery
UI.Kuaishubao borrows from McDonald’s delivery method, takes “1-hour home delivery” as a major marketing feature, and integrates the category construction of 7-11 and the product selection standards of Hualian Supermarket, and uses the user micro-experience structure that is difficult for leading e-commerce companies to cover. become its own core competitiveness.

In the current e-commerce market full of gunpowder and full of giants, how can small and medium-sized e-commerce companies find their own living space in the fierce competition?Facing the aggressive and strong offensive of industry giants, can they find their own competitiveness?
The answer given by Kuaishubao is to be the fastest online selection convenience store in China, to provide customers with convenience needs with "selection + 1-hour fast delivery", and then to obtain core competitiveness.

Move the convenience store online

Kuaishubao is Xu Zhiming's second venture.As early as 1995, he and his wife Gao Zhihong co-founded Beijing Dragon Media Advertising Culture Bookstore and developed it into a nationally renowned professional bookstore.While the offline business was successful, Longzhimei began to sell books online, and soon, online sales accounted for half of the total sales.Seeing that e-commerce has become the demand trend of customers, Xu Zhiming took his energy out of Longzhimei and started a new adventure. In June 2010, Kuaishubao was officially launched.Among the start-up capital of 6 million yuan for Kuaishubao, 300 million yuan was an angel investment given to Xu Zhiming by his classmates, and the other 200 million yuan was raised by him by selling a house.

Yihaodian is the electronic business after Wal-Mart goes online; JD.com and Dangdang are the electronic business after Mall goes online.However, there are no convenience stores that do electronic business online. Therefore, the business model set by Xu Zhiming for Kuaishubao is to create a small and comprehensive 1-Eleven (the name of the convenience store. The 7-Eleven brand originally belonged to the Southern Company of the United States. Became a Japanese company in 11) online boutique convenience store. 7-2005 only sells more than 7 kinds of products, McDonald’s arrives within half an hour, and Hualian Supermarket strictly controls the quality of product selection. In Xu Zhiming’s view, the combination of the three is the core competitiveness of Kuaishubao.

Considering years of experience in book retailing and publishing, Kuaishubao starts with books and expands its categories step by step. The products it sells include magazines, food, beverages, daily necessities, flowers and performance tickets, which are very similar to 7-11’s business categories. similar.The distribution area of ​​the fast school bag is almost the same as that of 7-11, mainly in the office building gathering area in the center of some big cities.

The selection standard of Kuaishubao is selection, and the number of products in each category is small but refined. For example, the number of books is controlled within 500, and the main focus is on the bestseller market segment.

1 hour home delivery
Drawing on the McDonald's-style delivery method, Kuaishubao highlights the word "fast" in its marketing features, and launches the service promise of "delivery to home within one hour".In Xu Zhiming's view, 1-hour home delivery is not a gimmick. The real demand behind it is quick satisfaction, a time limit commitment, and consumers can control the purchase process themselves. This is actually what every consumer needs.To achieve such a user experience, the premise is to set up a distribution station with a radius of 1 square kilometers in the delivery business area of ​​Kuaishubao. The total driving time is controlled within 2.5 to 15 minutes. Once there is a shortage of goods, various warehouses can coordinate .More importantly, the warehousing and delivery are all built by Kuaishubao itself, not outsourced or cooperated.

In order to save promotion costs, Kuaishubao was spread through forums such as Weibo and Douban at the beginning of its launch, and finally found the best marketing path on Weibo.With its eye-catching one-hour delivery and unique blue floret cloth packaging, Kuaishubao has generated a lot of comments and retweets on Weibo, earning word-of-mouth in a short period of time.From the initial average of 500 to 70 orders per day, to the relatively stable [-] orders today, one-third of the users who enter Kuaishubao through Sina Weibo account for one-third of all users, while the other third use Baidu search to enter Kuaishubao. Among them, [-]% of name input mainly comes from Weibo.

Kuaishubao also puts the main battlefield of customer service on the Weibo platform. The company clearly requires that complaints and suggestions from customers must be answered within 5 minutes during working hours.Xu Zhiming spends three to four hours on Weibo every day, launching new products, responding to consumers, and thinking about problems encountered in operations, so these are presented in Xu Zhiming's sharing and real-time interaction with member users.

However, the rising labor costs faced by the human delivery model of one-hour delivery to home, as well as rising storage rent costs and financing pressures will all be formidable challenges that Kuaishubao has to consider in the next step of expansion.

(Section [-]) Hit the Pain Point: If you want to "win" sales, you must first be able to tell stories
"Customize a wedding ring with a love story", the slogan of BLOVES hits the demand for customized wedding rings of the younger generation.BLOVES, who realized the era of custom-made wedding rings earlier, relied on the business model of "online publicity + ground chain" to allow the beautiful story economy to carry e-commerce, and successfully grabbed the big cake from the finished wedding ring market.

The movie "Dwelling in the Fuchun Mountains" starring Andy Lau, Lin Chiling and other stars, the box office and "saliva" are soaring.The "BLOVES Wedding Ring Customization Center", which provided jewelry sponsorship for the movie, took advantage of the opportunity to gain a lot of attention and became popular by relying on movie implantation.

BLOVES was established in 2009. Different from traditional wedding ring brands, BLOVES adopts the business model of "online promotion + ground chain". This model allows BLOVES to rise among the powerful traditional jewelers.In the past five years of development, BLOVES has promoted concepts such as wedding diamond customization, fast fashion, and e-commerce online, and provided customized service experience offline, making the "online promotion + ground chain" model play well water rises.At present, BLOVES has opened 5 wedding ring customization centers in 24 cities in China.

diamond ring custom business
Before 2008, the wedding ring market was almost dominated by finished wedding rings, and brands such as Chow Tai Fook and Chow Sang Sang were the absolute protagonists in the market. Cao Lin, the founder of BLOVES Wedding Ring Customization Center, chose to enter the blank period of China's custom wedding ring market, opened the first "Wedding Ring Customization Center" in Nanshan, Shenzhen, and began to compete with the finished wedding ring market for cake. The establishment of BLOVES Wedding Ring Customization Center subverted the mass production of homogeneous finished wedding rings, tapped the hidden demand for wedding ring customization, and quickly gained the recognition of young consumers with the positioning of "customizing wedding rings with love stories". .Up to now, the monthly sales of diamonds in BLOVES single store has reached about 100 million.

These all rely on the customized economic model of BLOVES.When customers need exclusive diamond rings, they can learn about samples on the official website of BLOVES. After making an appointment, they can go to the physical store for consultation. The clerk listens to the love stories of customers and records their thoughts and needs.Then, the designer will integrate the story and needs into the design of the diamond ring, and finally design the three-dimensional style of the diamond ring.After the customer is satisfied with the style and confirmed, BLOVES starts to make jewelry.There is only one piece of finished product created through the above steps, and it will not be sold separately.

According to the annual inspection data of Chinese jewelry, the Chinese wedding ring market reached 2012 billion in 750, 95% of which are finished wedding rings, but customized wedding rings are growing at a rate of more than 200% per year.Cao Lin believes that BLOVES has a lot to offer in this market.

Test water e-commerce
Diamond e-commerce is a concept carried out by BLOVES at the beginning of its establishment. In the actual operation process, its essence is already a model integrating online promotion and offline chain experience stores.Since its establishment and operation, BLOVES's strategy has been very clear: through concept promotion, consumers can learn about information online, and divert them to experience and place orders offline. The focus is on increasing the sales of single stores, rather than blindly expanding stores.

BLOVES offline single store sales accounted for 80%~90% of the total sales. Although online diamond selection sales did not exceed 20%, it greatly eased store inventory, and its capital turnover rate was 4 times that of traditional stores. times.For consumers, the significance of online channels is that they can inquire about diamond product information through the BLOVES e-commerce website, and then order, pay and pick up the goods at the experience store.During this process, the function of the offline physical store is not only a sales store, but also a product experience center and service center, providing customers with localized experience and after-sales service.

In addition to the O2O-like model facing the consumer market, BLOVES also directly connects with suppliers through e-commerce channels for external procurement. BLOVES adopts online direct purchase, which reduces the cost of intermediate wholesale links and retail channels.Through the realization of inventory docking and IT control of order management with 79 sightholders (first-level agents) around the world, the profit sharing of layer-by-layer distribution of traditional jewelers is eliminated.

Whether it is an incomplete O2O model for the consumer market or an online procurement for the global market, its effects are obvious.Since 2009, the annual market growth rate of nearly 200%, 35 physical stores, sales of more than 3 million yuan, and two rounds of financing have supported BLOVES to continue to expand in the traditional wedding ring market and grab the cake more and more.

(Section [-]) Power of Communication: Personal Brand Establishes Corporate Brand
As one of the most eye-catching new farmers in 2013, the key to Sister Tudou's success is to make full use of the power of Internet cultural communication, customize fashionable clothes for Tudou, use differentiated "singing voices" to enhance the added value of products, and use personal Brand building to establish a corporate brand.

In the era of Internet agriculture, how should traditional agriculture adapt?
The Internet of Things and cloud computing have fundamentally improved agricultural production efficiency; e-commerce platforms can subvert the relationship between agricultural production and sales; but perhaps Internet marketing is the point where traditional agriculture is closest to the Internet.

There is no doubt that using content marketing, video marketing, and social media marketing on the Internet to integrate and create agricultural brands is the direction of Internet agriculture in the future.

There are also many new farmers who are exploring the development path of "using Internet marketing to create brand agriculture". Feng Xiaoyan, the chairman of Shaanxi Jingbian Yongquanju Modern Agriculture Company, is one of the best.

Sister Tudou is one of the most eye-catching new farmers in 2013.She turned the rustic potatoes into high-end and elegant brand products.Thanks to the efforts of Tudou sister Feng Xiaoyan, the [-]-mu Yongquanju Ecological Potato Planting Demonstration Park in Jingbian has become a provincial-level modern agricultural demonstration park. The two brands of Yongquanju "Ecological Potato" and "Tudou Sister" respectively Obtained the provincial famous trademark and the national famous trademark, the brand effect has begun to take shape, and the supply of orders is in short supply.

Tudou sister's marketing success benefits from three points: integrating culture into online marketing; product quality is the cornerstone of marketing; marketing in a way that conforms to Internet thinking.

Network detonated brand building

Using the Internet to build brand awareness and building a personal brand to establish a corporate brand is undoubtedly the key to Sister Tudou's success.

(End of this chapter)