Deputy President Wang Huiwen: The takeaway market is like a desert

Absrtact: We can take the past market as a desert, the development of the industry is to change the entire desert oasis process. Takeout has not been done in the past for so many years, compared to many other industries that have long been the internet, in fact, takeout

We can think of the past takeaway market as a desert, the development of the industry is to change the entire desert oasis process. Takeout has not been done in the past for so many years, compared to many other industries that have long been used by the Internet, it is really hard to do takeout. So it's not too unusual to liken the market to a desert.

But in this desert there are always some places that become oases first. If the entire takeaway market is divided into several segments, there are three major schools, offices and residential markets. It seems to us that the campus market is the first part of the oasis in the takeout. The characteristics of the university market is that the user is more concentrated, the merchant is also more concentrated, the order quantity is big, so can be in the production and distribution.

Take-away business inside, distribution can be a very important factor, can not be single, distribution costs will increase significantly, distribution time will be greatly extended. The campus is a natural market can be a single, so we can compare the campus is an oasis.

There are three factors that affect the cost of selling this business, one is the user's requirements for the quality of the dishes, the second is the user requirements for distribution, there is a just mentioned the user and the concentration of business. The level of concentration will directly affect the first two costs.

From the strength of demand, the school market demand is the highest, followed by the office market, and finally the residential housing market. In terms of population density, or the density of orders within the unit area, it is the same order. The density of the housing market is the lowest, the density directly affects the cost associated with the distribution, so if the school is an oasis, the office is still on the edge of the oasis, it is difficult to operate than the campus will be higher, but less than the residential.

But the market of colleges and universities is not big, when the university market tends to saturation, the United States to sell this year to do white-collar market. We will start from the office of the market, the market relatively good and the size of the volume is also relatively large, open cities will be less than the campus market, is expected in 200 cities or so.

It's hard to cut the low-end from the high-end takeout market

To do a business is basically two routes, either from the low-end market, the low margin market to the high margin market, or from the high margin market to the low margin market, basically each other have a point of entry.

There are some businesses that are hard to get into the high-end market if you do a low-end market. There are also some businesses that are hard to get into the low-end market if you do high margin or high-end markets. Takeaway this business, belong to the latter, from the high-end business into this low-end market is actually more difficult.

The key to determining these two paths is your user awareness and the cost structure. One type of business is determined by the user's perceptions, and obviously consumer goods. Users think you are a high-end brand so use your product, this time the product can enter the low-end market. A high-end brand into the low-end market, people will feel very good, I can use this brand. But if you turn from a low-end market into a high-end market, users will not be able to accept it.

Another is that the business is determined by the cost structure. In this case, if you start out as a low-end market, because the low-end market margin is low, so the entire company around the cost of compression to do. If you enter the high-end market at this time, because the high-end market margin high, you lower cost structure into the high-end market, you can provide lower prices of products to compete with each other.

And the original high-end market due to enjoy the high margin, the cost structure will generally be relatively poor, leading to say that he entered the midrange and high-end market, it is difficult to reduce service costs, it is difficult to therewith low prices to compete.

Outside selling such a market inside, the platform itself is not high-end and low-end difference, so originally do low-end can hit the high-end, and high-end back to do low-end market, because the cost structure has been around high margin to do to design, it is difficult to defeat the original low-end market competitors.

The effect of take-away subsidy is less than that of taxi subsidy

We did some subsidies last year when we were doing the college market. This year, the white-collar market, subsidies will continue to do. In the past subsidized the most powerful is the taxi software, and sell the business inside the subsidy, in fact, as a taxi software subsidy effect.

The service flow of taxi software is this: Call the car--by bus--settle payment. Taxi software to achieve just call the car and clearing the function of the middle of the ride in the process of service process platform is no matter, also do not have to pipe. Because before there is a taxi software, the entire taxi industry service process has been basically standardized.

Taxi software only to call the car and clearing, this is the Internet is the best thing to do, which will lead to the service experience between competitors will not be too much difference. So the entire taxi service flow inside, consumers in addition to the price of the experience is similar, so the difference can only rely on price war.

But in the selling business, the middle of the service process itself is immature, the consumer's experience in the business is not so sure. So outside the market, the platform to spend a lot of time to run business services, do a good job in the middle of the service link.

When a platform and B platform services differ, the effect of the subsidy is less obvious. This is the situation on the campus market, if the white-collar market, the situation is even more obvious, because the office and the residential market users care more about the service.

On the whole, white-collar users than the campus users of the time sensitivity, for the quality of the sensitivity to high, the value of the sensitivity of no students high. So in the student market will do promotions, students may be due to the promotion of the quality of the time to reduce the demand, but in the white-collar market, even if you do the promotion of his time needs, what kind of quality requirements will not change. So in the white-collar market, the difficulty of business will become larger.

So, in the whole takeaway business, the subsidy does not work as much as everyone thought. and office sales in the market, the subsidy effect is smaller than the campus market, and to the residential district in this market, the role of subsidies will be further reduced.