The micro-profit of the electric trader in the cold winter

In a few years, the development of electric companies is not a smooth wind, on the contrary, almost all of the electric companies tighten their belts to reduce advertising spending, the original high Internet advertising prices began to fall, the electric business industry is ushered in the cold winter.

In the April of 2012, the light of spring enveloped the Earth, but for the entire e-commerce industry, the haze was hard to disperse. The coldness of the capital still, the news that the enterprise closes is far and away unceasingly. and affected by the whole of the capital of winter, in addition to the platform type of Jingdong, Ali and every guest, almost all the electric companies tighten their belts to reduce advertising spending, the original high Internet advertising prices began to fall back. VC also on the requirements of the electric business enterprises more rational, in addition to the new investment in the more prudent, for the investment of the company's assessment requirements have been reduced, and even consider is no longer the growth rate, but to the gross margin.

The collective shrinkage of advertising

Massamasso may be a representative of the electrical business in the cold winter, the appliance companies, although in the development of three years of micro-profit, also not fall into the plight of the lack of money, but still have to take measures to reduce costs.

In February this year, Massamasso employees received a new assessment contract, and after the implementation of the new evaluation index, in addition to the financial and Manpower Department pay reduction of 20%, the other departments have a pay reduction of 30%, the remaining part of the wages will be issued in a quarterly basis, as appropriate. March, Massamasso also closed the Beijing World Trade Center, the only one by one experience shop, and the experience shop has been the focus of Massamasso brand promotion.

Massamasso vice President Messing Frankly, the big environment is not good, Massamasso need to make to reduce costs, improve operational efficiency of the move.

In addition to the above actions, Massamasso also significantly reduce the amount of advertising, the reduction of the proportion of up to 40%. "We will focus the main internet on sites with higher returns, such as precision marketing, web site navigation, and portals with higher returns on individual investments," he said. "Messing said.

If Massamasso more representative of the brand of electric dealers, the lower margin of the brand is a significant reduction of advertising budget.

Chen, Vice president of Lok Tao Network, said the company had stopped all advertising. In the last year, the company in June 1 High-profile packet under the Baidu home page, played "Lok Tao Baidu Hand to the barefoot children donated 61000 pairs of shoes" ads.

Another has just won the 20 million dollar financing footwear consumer Cool campaign also said that has significantly reduced advertising budget. and Cool Sports CEO Zhu Qigong is said that, according to him and a lot of electrical business in charge of communication, this year's electricity market will have a larger advertising adjustment.

"Vertical operators of large-scale advertising budget shrinkage, luxury sites are many closed, group buying site has also been a large-scale clean-up, so the current market for electricity business advertising looks lighter." "E-commerce expert, Huaqiang North online vice President Shangxiang said.

Since last December, the luxury website, NetEase's "NetEase still Goods", Shang Network, respectively, the news of the closure or layoffs, and the company also reduced the advertising budget.

Group buying sites are similar to luxury sites. According to the relevant statistics, in 2011, a total of 1968 group purchase website closed down, even in the industry well-known 24 coupons, full, Bao-bo network and other sites have broken capital chain, layoffs and pay cuts in the news, in this case, advertising is no longer possible.

In addition, even a few of the top group-buying sites that are alive have drastically reduced advertising. According to understand, handle nets and litters regiment has stopped all offline advertising and most online advertising, and these two companies have in the last year large-scale advertising.

URL Navigation advertising Price drop

"E-commerce companies to reduce advertising, which directly led to Internet advertising prices have fallen, I personally feel that the first quarter, the Web site navigation category of Internet advertising prices dropped 10% to 20%." "Shangxiang said.

Yi Ma Online CEO Kosching also expressed a similar view. "On the whole, advertisers are now more focused on CPS and precision marketing ads, consider the return on investment, cut off a lot of investment return is not high platform advertising, even if it is able to attract huge flow of Web site navigation station advertising has been affected, the overall price lower." However, because the site ads are on a quarterly basis, I believe that the trend of price reduction will be more obvious in the second quarter. "Kosching said.

Long-term attention to the Internet advertising market excellent shopping online shoe city CMO Xu also saw the price of loosening. "Take the website navigation station HAO123 as an example, because buys and the electricity merchant competition intensity drop, its name station cool station bids the advertisement position to have already fallen half." ”

It is understood that last year, the electric commercial advertising has become almost all Web site Navigation Company's important revenue source. Previously, Qihoo has disclosed that its income in the last year, E-commerce accounted for the proportion of about 50%.

The price of second-line internet advertising is falling, in addition to the drop in the price of Web navigation ads. Xu said the price of second-tier internet advertising media has fallen, except for some of the strongest ad prices on the home page of Internet portals.

"Top of the front page of the portal advertising is still scarce resources, at the same time, in addition to the electricity business advertisers, other industry advertisers are competing for resources, therefore, the home page advertising price has not fallen." However, the portal site frequency and other second line of advertising resources have more to talk about space, for example, we can through the package year or monthly subscription to obtain more promotional resources. "Xu said.

Another is reluctant to disclose the name of the Internet marketers analysis, by the influence of the electricity business advertising indifference, some vertical websites, medium platform category advertising price range of up to 20%.

VC Assessment Index Change: From sales to gross profit

The company's advertising budget has fallen sharply, in addition to the overall reduction of the capital market on the investment in the electricity business, but also with the VC's assessment of the electrical quotient of the changes.

"Before the VC often asked the electric company to expand the scale of sales as soon as possible, and the sales growth rate as the assessment requirements, and now the wind turned, VC hope to invest high margin high turnover of the electricity quotient, the investment of the electricity business assessment requirements are gross margin." "Shangxiang said.

Similarly, the information from the investment community also shows that the gross margin and profit expectations have become the VC's assessment of the electricity business and the requirements of continuous investment.

This assessment also led many electric companies to change their annual development goals in the hope of attracting new investment through high margin and profit expectations.

Massamasso vice President Messing Frankly, this year the company's main goal is to increase the gross profit margin. At the same time, she believes that the current electric business industry has been gradually rationalized, return to commercial nature, at this stage unprofitable is shameful.

Where customer prudential products will be the main goal this year to improve the gross margin and profitability. Earlier, the media reported that aging in the 2012 internal planning meeting proposed a profit target. And any customer prudential goods investor, SoftBank CEO Yan also had to put words, except for the future of investment, where the operating profit of customers has been positive, where customers will soon be profitable.

Investors from Jingdong said that, since last year, the investor has ceased to use sales growth as a test requirement, but instead expects the BoE to raise its gross profit margin, a demand that is clearer this year. In an effort to raise gross margins, Beijing has also taken measures this year. Previously, an Jingdong mall and the supplier of the Cooperation agreement exposure, under this agreement, the supplier must ensure that Jingdong Mall 20% of gross margin, and gross margin of not less than 1 million yuan, the supplier also must pay 200,000 brand service fee to Jingdong. And Liu I also confirmed that jingdong for small household electrical appliances and other high Maori industries to charge a higher margin ratio. At the same time, Jingdong insiders said that the current Jingdong no longer requires 3C and other major categories of ultra-low prices, just hope that through some promotional products to drive new users.

Group buying sites have also made the main goal of raising margins and profitability.

Previously, the United States Group Network has made a High-profile announcement, the fourth quarter of this year, the United States will achieve profitability. Handle NET CEO Wu also said that good group buying enterprises should be in 2012 years to achieve profitability.