Low customer unit price, high standard category is heading towards 0 gross margin

The products below refer to the broad sense of products, including products and services, including the visible touch of daily goods also include digital products and services. Product prices are usually composed of two costs: one is the cost of the product itself, the other is the cost of sales/service.

0+0 Products

Some products are more special, the marginal cost of the product itself is close to 0, mainly software, games, film and television music and other digital fields. and direct sales/service via the Internet, the marginal cost of sales/service can also be close to 0, such two marginal costs add up, 0+0 or close to 0, on the basis of free, coupled with the pricing of the courage to break the original price system, direct free, this is what we often say the Internet free thinking, This kind of product is called 0+0 product.

N+0 Products

Most of the products in life are seen as tangible products and experience services, the marginal cost of the product itself is greater than 0, for example, now and for a long time the marginal cost of a meat bun is impossible to reduce to zero, even through the combination with the Internet, the product itself is still cost, This is not the same as the digital product. But sales/service costs can be greatly reduced by the combination with the Internet, close to 0, especially the low customer price, standardized category. Through the Internet, we can reduce the cost of steamed buns to 0, it is possible to achieve, so most of the low customer unit price category is the basis of n+0.

Low customer unit price requires low level of trust, in the early stages of the development of the Internet can well adapt to the customer's trust demand, for the full automation of sales provides a trust base; High standardization provides the possibility of full automation, through the PC and mobile phone to achieve full automated sales services, so as to achieve the marginal 0 cost of sales services, To achieve zero gross margin.

0+0 belongs to n+0.

Free Products (0+0 products) is only a low customer unit price category (N+0), is a subset of low customer unit price, life in the future more common is n+0 products. We say that the free product is a low customer price category subset, because 0 belongs to N, so 0+0 belongs to n+0.

From 0+0 to n+0 is the process of increasing n.

From 0+0 to n+0 is the development of the inevitable, n the absolute value will continue to rise. On the one hand because you can achieve 0+0 products so much, finished it, you have to open up 10 pieces of money category 10+0, and then over a period of 10 dollars also done, you have to open up 100 pieces of money category 100+0.

On the other hand, with the integration of the Internet and life services, the increase in user volume, the average customer price level of the promotion, more and more high customer price category can be sold on the internet, can become a means of transformation, thus providing a low customer price category free of charge provided the premise. But only similar customer unit price category customers can be transformed, the category of customer price gap is too large customers repeat consumption will play a very large discount, in the game of the customer base to sell the house conversion rate is very low.

Pseudo 0+0 Products

There is a kind of product more interesting, in a strange state, that is, the amount of less than a certain amount of marginal cost is 0, but reached a certain threshold, the marginal cost soared. Such products are mainly resource-free classes, such as: Movie tickets, tickets, hotels, are not fully used, a movie to 100 people can be recovered from the cost, the marginal cost from the 101th person is 0, but if there are only 200 locations, The marginal cost of the No. 201 man suddenly soared to 1 halls of cost. The internet can still play a small role in digesting these idle resources.

Gao Ke price Category The future space is huge

Gao Ke Unit Price category is still in the early development, relative to the category of hundreds of yuan, thousands of tens of thousands of of the high customer price category is now beginning to have a heavy trend, but still in the early development. With the low customer price competition more and more intense, more and more low customer unit price category will go to 0 gross margin, and continue to turn the current business to the high customer price area to promote, infiltration. Internet companies directly through the Internet to complete the room, car, medical, education, pension services, such as high customer price category Products sales service will become a reality, but only a matter of time, not just provide information platform.

The internet is seeping from information platforms to sales and production

The internet is gradually penetrating various industrial chain information platform, sales and production of these three main links, starting from the information platform, slowly to the sales, production infiltration, along with this infiltration, in the industrial chain of greater importance. Information platform is an early development must go through the stage, but after a certain stage will also face the problem of lack of user experience, can not provide a consistent customer experience, in the experience of the improvement is also lack of means, so often will rise to continue to penetrate the sales link to enhance customer experience.

The information platform and the sales two layer in the subdivision area will be gradually merged into a layer, the industry chain only has two layers, to achieve a relatively stable state. Of course in some industries also appeared a company-owned industry chain, Apple, for example, depends on the level of industry development and the degree of company NB, and it is possible that each industry will end up with a fully-finished (whole-industry chain) and an open company (a large share of the industry chain, but fully open, such as Android) , and is accompanied by changes in consumer habits that generate share changes.