Tiger Olfactory Note: This article from the "TMT Youth salon" of the industry exchange of dry goods sharing, by the TMT Youth Salon authorized Tiger Sniff exclusive release. The TMT Youth Salon, organized by a group of young people from the Internet, traditional it and communication circles, is one of the most influential youth organizations in the TMT circles in Beijing and Shanghai, with more than 1200 members, covering industry analysts, listed companies, investment institutions, Internet, entrepreneurship, consulting, legal, financial and other fields.
58 vice president of the city, Zhangchuan, is currently responsible for 58 commercial product systems as well as e-commerce and Group buying division, with many years of experience in internet local services. Before joining 58, Zhangchuan in Baidu as the Alliance product Director, responsible for the Alliance product system planning and establishment, at the same time responsible for Baidu advertising Butler, Hong Media and Baidu buy products such as. On October 21, he shared his years of experience in internet local life services at the TMT Youth Online salon, explaining the pain points of local life services, the difficulties and the ability to make money, and how to make money.
Tiger sniffing continues to focus on the development and transformation of business and related companies.
Here are the notes on the Zhangchuan lecture:
Today, I would like to share with you some observations and suggestions on how to make a living service market.
Looking at the heat of life service from the search words
In many industries, Baidu Index is a very worthy of reference indicators. For example, when we were in 2009, we were judging 4399 fires. Why? Because in the Baidu index search "small game" and search "4399 games" two keywords compared to the "4399 mini-game" heat unexpectedly higher. When a brand word replaces the industry word, it shows that the company has been rising in the industry, to the top of the sprint, to achieve such a level, the company's traffic costs will be sharply reduced.
We look at the life services industry Why the fire, a judgment is the current life service category more and more search words, people on the Internet, the demand for life services has increased significantly; one is the brand search more and more, as Craigslist in the United States has been ranked fourth, Much higher than Amazon and other e-commerce sites, "58 with the city" search is also growing very fast, gradually widening the gap with competitors.
What kind of life service industry can hold out a listed company?
In fact, the field of life services has a broad and narrow sense, there are many segments of the industry. A broad range of local life services include automotive, real estate, recruitment, gourmet entertainment, guaranteed investment, insurance, home building materials, housekeeping services, business services, Hotel Inn, car rental, education and training, wedding photography, medical health, beauty, peripheral travel, tourist tickets, pets, car services, ticket performance, mother and child, law, ticketing performance, Pets and so on, these industries have recently had a large number of VC cases in the United States. Narrow life Services in fact, mainly refers to food and leisure entertainment, which is currently the most fire of an area, a large number of enterprises at present in this field of fighting, including public comments, QQ Food,, Weibo, Baidu and a variety of group buying site, the so-called Zhuluzhongyuan, mainly refers to dining and entertainment.
In choosing the industry you want to do, you can choose by pushing backwards: assuming your goal is to achieve a US listing exit, your business needs to have at least $1 billion in market capitalisation, so you may need 10 to 2 billion yuan a year for income, such a revenue requirement, There is also a high demand for the market potential of your chosen industry. In this way, the Life Service category can not be listed in each segment of the industry, the larger GDP value of life areas, such as automobiles, real estate, recruitment industry these are tens of millions of production value, more in line with the requirements of listed companies. Health and education services is also a major industry, Baidu is one of the main sources of income, the two industries are also rich, but for them to do vertical services are not easy to earn money, because they have high prices, low-frequency industry characteristics, vertical sites are limited, this I will say in the back. In addition, many other industries are very small, such as pets, ticketing and so on, so it is unlikely to accommodate a listed company. The development trend of the platform will be more suitable for some types of life services of large sites, start-up companies do a small part can also, but like content providers.
Subdivision attribute of Life service class
In the field of life services, the differences between the different industries are particularly obvious, you need to have a clear positioning of themselves.
Tradesman vs Tour Operators:
The former refers to some businesses that need a storefront, such as food and beverage, massage, and the location of such businesses and POI (point of Interest) is very important. For example, food and beverage, you must be tradesman, because guests go to your shop part of the consumption is in the consumption of your environment, to the store to feel. The latter refers to service businesses that do not need a storefront, such as repairs, travel, and air tickets. Tradesman and the cost structure of the tour operators are very inconsistent, so the business model and the demand for online marketing model is inconsistent.
Short decision vs Long decision:
The main difference between these two types of services is the length of time consumers make decisions. Where to eat and other consumption decisions in a short time will be completed, food/beauty/hotel and other areas are short decision-making, where the impulse factor is slightly more, so in these areas need to use the user process is very convenient is the key, because the user needs to achieve the way the user goals are compared to form and obvious. and wedding/education and training areas are long-decision-making, most from start to finish will be long, decision-making points, and even can be split out a lot of sub-projects, to many people and businesses to deal with, so need to user needs, user processes have more accurate grasp. At present, like the public reviews this kind of domestic short-term decision-making service platform has done very well, the current life service business promotion space may be in the field of long-term decision-making industry.
High profit vs Low profit:
For many living services, the online part is only to do diversion, and offline sales, Terminal Services is the key to improve profitability and customer unit price. For example, in the plastic and cosmetic industry, do you know what is the annual salary of the Consultation doctor at the beauty hospital front desk? At least 500,000 yuan. She is a senior sales, depending on whether you wear the season or the last season of clothes, back LV or Hermes to judge you to recommend 20,000 or 200,000 of beauty items. Her value is the ability to judge the brand and people's consumption, as well as sales skills, resulting in the increase in guest unit price, the ability of these salespeople is online services and how to improve and can not imitate. There are real estate sales and so on, in the high-profit industry, contains a lot of this kind of online non-duplicated offline sales operation capability, so the students to do business to clear their own help the industry chain to complete what optimization work, rather than modify the entire industry chain, not to try to use the line to replace the line. This characteristic is one of the main essence of the life service industry.
Fixed cost vs Variable cost:
The fixed cost of local living services is relatively high and the cost of change is relatively low; this forms the main characteristics of the service industry, the discount intensity is big, need to balance the customer's consumption time and frequency. Therefore, the economics of the price discrimination strategy in the life of the most widely used services, for example, club consumption has a membership card and no membership card is absolutely two a very large purchase price gap. Group buy formally on this basis came into being a price discrimination model, so to do life service business, to find suitable for the industry's price discrimination strategy is a very key entrepreneurial point.
Today's exchange of partners have many are group buying industry, there is also a request to chat group purchase, then a simple chat, buy is a very simple price discrimination strategy application, is very suitable for the spa, wedding photography and other industries, in the catering industry, the difficulty will be relatively large, the current domestic group purchase site over-reliance on food and beverage, This and the nature of group buying will be a challenge, such as movie tickets and so on basically be bought into after the no price discrimination said, are cheap fares, for users is good, for the industry is not necessarily a good thing. The survival of this line is that who can finally study the price discrimination strategy to the deepest. These are the first challenges for group buying. The biggest challenge for group buying sites is that China's group buying margins are low, but it is a big challenge to maintain a high-cost, cost-increasing line-up team. we all know that the cost of direct sales team is not linear growth, you raise 1000 people cost if 5 million/month, 2000 people team may need 15 million/month, because more people, you need to build hierarchy to manage, many cities you don't even go, City manager basically out of management, Management costs can be very high.
Consumption frequency and price determined by different market capacity
As mentioned earlier, health care and education services are high-priced, low-frequency industries, this division in fact from a life service industry structure, the horizontal axis is the frequency of consumption, vertical axis is the consumer price:
This figure shows which markets are larger in size. It can be seen that the big market is mainly concentrated in low frequency, high price and high frequency, low price of two quadrants. the representative industry in the previous quadrant is the automobile, the real estate, the recruitment, the representative in the latter quadrant is the food entertainment. In these areas, even if more companies come in, because the market space is large enough, but also can be divided into a cup of soup.
And for the low frequency of the two quadrant, a low frequency of products, high flow costs, the new user's visit is very low, each time to buy the flow; who can solve the traffic cost of these websites in the future will be a big business. According to the industry law, users will have to visit a website 6 times before they can impress. So, in the low-frequency, high-price quadrant of the education, medical and other industries entrepreneurial projects, I am also observing how they will find a sustainable business model. and the low-frequency sub-quadrant of the industry, as listed in the business services, housekeeping services, and so on, there is absolutely no independent service platform, because it is too low income, traffic costs are too high, not worth.
Low-frequency lower-priced products, must rely on platform-based products to reduce the flow costs, which is 58 of the advantages of the same city. This piece is very suitable for 58 of the same city, Craigslist such a comprehensive classification information site, it put a lot of service long tail together, make up for a single service access low frequency times shortcomings.
is the core online or online?
If the question is answered abroad, there is no doubt that it can be solved on the line. With an example of an American house short-rent website, Airbnb has a team of about 20 people, starting from 2008 to the day the singular has surpassed Expedia, booking, a professional online travel company, with a particularly rapid growth rate.
And China currently has more than 200 Airbnb types of websites: Love day rent, ant short Rent, Tujia, Tour world, Pig day rent and so on. But are their cores also online? No.
A big difference between Chinese and foreign short-term rental sites is that Airbnb homeowners can leave their keys in one place, letting tenants pick them up on their own, while China's short-term rental sites, after finalizing a short lease, need to sell their own keys, take the subway through the city, hand them over to the tenants, otherwise the user experience cannot be controlled. Businesses are also reluctant to pay this cost. To Beijing, this big city, a sales day can deliver three or four keys is good. What is it? The lack of credit system in China's market has led to a rise in the cost of human resources, in order to improve the user experience, so that the company's offline part is very large, become very heavy.
Similarly, China's private cars can not be as light as the U.S. uberer, because in addition to the short-term rental site similar to the risk of trust in China, there is a particular legal risk.
I can also cite a few examples, such as furniture industry, Qi Jia and home world model is the best, relatively light, online operations can be, but from the user experience is far from the United States Lele, forest wood These sites, these sites are very large. So at the current stage, China's "in-line" is actually the main stage of offline entrepreneurship, the role of the online traffic access, free from the traditional channels of dependence. Easy to use vehicles and e-generation vehicles are very good embodiment of this judgment, they do not want to control so many drivers and vehicles, but in China you do not control, you can not deliver good service, so everyone is more and more heavy.
The biggest pain in making a living service market is that in this system, the entire process of payment, security habits and e-commerce are completely different. Therefore, we need to look at the problem from the user's point of view, consider how to not change the user's consumption habits, shorten the chain to improve the whole industry. Therefore, all the entrepreneurs who want to really do the service of the services, it is best to have a offline company or business to practiced hand, and then consider how to do a line of integration.
Go left to the right? The future of classified information sites
Let's take a look at two classified information sites, one of us cragslist. From Google's search index, Craigslist's search for more than e-commerce sites, much larger than Amazon and ebay, ranked fourth in both 2010 and 2011. But it has also recently faced some sort of crisis: Originally, the subdivision of the cragslist, slowly replaced by the focus on the subdivision of the site. This is a bit like the early BBS on the Internet, each of its sections, gradually replaced by similar subdivision sites, such as the demand for short-term rental, the original is cragslist can meet, and now has gradually been replaced by Airbnb. And Cragslist is still leading the business, recruiting, dating and second-hand.
The other is Japan's largest classified information website, recruit. This website originates from the Japanese classified information newspaper, it is different from the cragslist, it is by is more than 200 subdivision information website accumulates, and not only a big website below the subdivision channel, above, for example, have all the information and evaluation of all the hairdresser, thin to who in which position, Good at what hairstyle. Recruit equals the function of the American airbnb+uber+cragslist. Even he a real estate classification has a number of sites integrated composition, rental, housing, office and shops are different sites, each user experience is different.
Craigslist use post to solve all the problems of industry differentiation, recruit with the classification of the standardization and personalization to see this problem, this is two different sites.
Classified information sites, the key is to give information to the processing capacity of standardized processing. I personally think that China's classification site should be biased towards recruit rather than completely imitate the direction of Cragslist.
Discussion on the business model
The most typical two business models of China's living service websites are advertising mode and commission model. My personal view is that in this market for customers, including the provision of life service information, the business model of Chinese media sites is the bottom line is advertising, commission model is pull: Commission is high, offline merchants will unite consumers running a single, less commission, the site also earns no money. Therefore, the advertising model for China's economic and credit characteristics.
And in the face of charging customers the mode of advertising fees, the enterprise also has membership and consumption of two kinds of charging methods. The difference between the two is that the membership of the cash swing fast, the consumption system is slow. However, the consumption system is more suitable for the patient enterprise, the money is more and more. Membership System because the price is very difficult to formulate, and it is impossible to constantly adjustment, in fact, more difficult to make money. Therefore, enterprises in the choice of mode should be clear to be slow or fast money.
In general, the business model of the internet depends on "the number of people + distance from the transaction", in the selection of the industry and the formulation of strategies, think clearly these two points, can be a great help.
How to make a hard-to-do local living service?