E-commerce in the mobile and O2O era will have "anytime and anywhere"

Yesterday, in the Guangdong provincial government held the 2013 Guangdong (International) E-commerce Conference, Tencent Group senior executive vice president, Tencent Power Business holding CEO Wu Guangguang for the first time to talk about Tencent's O2O business thinking and business layout, aroused the general concern of the participants.

Wu Guangguang that the mobile and O2O era of E-commerce will have "anytime and anywhere", "Digital customer Management (CRM)", "location-based Services (LBS)", "Big Data" and "Extended offline service scene" five characteristics, Tencent will also be based on these five characteristics of the integration of the introduction of the traditional retail industry O2O package solution.

According to Wu Guangguang revealed that, from last year, Yintai, Tianhong, Mao Industry and other large chain stores, Jackjones, only, Vero Moda and other well-known brands have begun and Tencent to carry out based on micro-letter platform O2O depth of cooperation, as of this October, More than 3,000 stores have been online related services. The industry is also widely believed that Tencent based on micro-letter O2O will be its challenge to traditional e-commerce patterns, the best time to redefine the status of industry.

The following is the full text of Wu Night Light speech:

Dear Governor Zhigeng, distinguished guests, ladies and gentlemen, good morning! Just now I heard Ray's speech at the stage, and it was also inspired, reminding me of a recently popular book, in our It circle, this is "out of control". Everyone is describing a similar idea, the book starts with the example of a bee, which has no meaning to a bee, and when a swarm of bees is brought together, there is a strong creativity that creates a very complex hive such a structure. He also talked about in the traditional industry, like a clock interlocking, involving a lot of complex processes, so that the system to play a role, but in fact, you look like a bee group, is not relying on a number of processes, relying on a number of systems to make the organization happen. In retrospect, I just heard the first two guests sharing, the internet is really like such a platform, it can maximize the strength of the group, as Ray Sum Mingzhu, like the bet, in the end, the Internet model and the traditional model who can win, in fact, very much like "out of control" described in the scene, The internet is a very, very decentralized platform that can maximize group strength. This is the deepest feeling I have heard myself.

From my point of view, I would like to share with you some of the opportunities we have observed in the traditional industries during this year for the arrival of the mobile tide. First of all, share some of the macro situation, Internet users in 2013 has changed markedly, the growth rate of only 10%. I have been in the Internet industry for more than 10 years, starting from 97 into the industry, and so far. The first ten years of our own experience is very exciting because basically you are enjoying the Internet demographic dividend explosion, from 100% to 50% or 60%, to 30% in the previous years, in the background of China's large population, the entire PC traditional internet is under the trend of explosive growth. This year, we are deeply aware of the very obvious impact of the mobile internet, and one thing Ray always says is that the traditional industry felt a deep crisis in the 99 and the Internet came. And by this year, if you are a traditional PC Internet company, you do not have anything to do on the move, I believe that every company will feel a very big crisis, because we see the PC Internet no longer grow, including from the point of view of Tencent's internal and we can see, our past traditional QQ, The traditional Tencent news portal on the PC traffic, the number is in decline, and our mobile micro-letter, mobile phone QQ, mobile mobile phone Tencent network is exploding growth. The number of iOS and Android users is exploding, and some users may say there is not a significant increase in the number of users on the Internet, because there are a lot of non-smartphone users.

In this trend, we return to the electrical business, we can find a lot of interesting opportunities are emerging. The internet has accelerated the transformation of traditional industries, and some companies have fallen instantly, such as Nokia and BlackBerry, a year or two from a very brilliant peak to the bottom. Many traditional industries are accelerating change, Su Ning paid a lot of courage and bear very big pain in the embrace of the Internet tide, including Lenovo and other traditional it brands are actively embracing the Internet. At the same time, we can see that the Internet is not particularly high in terms of the entire traditional industry. The whole big industry, only the net swims is completely internet business, the advertisement penetration rate is about 16%. Can see a large number of traditional industries, basically in the PC Internet age to see the proportion of the Internet is not high, for example, retail industry, that is, the most closely related to the real e-commerce industry, is generally 6%, 7% of the internet penetration rate. Tourism, catering, health care, education and so on, a large number of scale is still online.

On the one hand, we know that the future of E-commerce, mobile e-commerce huge potential, but also to see the traditional industry today, although the impact of a great deal of E-commerce, but still all of our traditional industries can not give up a piece, which is today many of our traditional industries encounter the dilemma, Embrace E-commerce feel that in fact the scale is not so big, for my sales are limited, do not embrace e-commerce as if in the future era will be outdated. Looking at the whole retail perspective, what is the size of the electricity quotient? Online scale, today we are talking about the online, many are PC Internet, that is, the traditional offline business moved to the PC Internet, is from the traditional e-commerce point of view. Still several large plate, women's, mobile phone digital, telephone office, men's, shoes and hats and so on. In 2013, the first half of the electronic retail is 11 trillion, network retail 700 billion, mobile is about 60 billion. We can see that the internet retailing is far more than the growth of social retailing, and the mobile electric business is exploding.

We are also thinking that the original E-commerce, traditional e-commerce is actually the line of business to move online, you can also see the Chinese e-commerce from the beginning of Taobao to today, in fact, has basically gone through three stages, the first stage is consumer-to-consumer, the traditional industry on E-commerce is not understand, nor interested, more are small and medium sellers , more users need to find something cheap, a lot of channels through the series of goods, parallel imports of the way, first to cultivate the first wave of e-commerce users consumption habits. In the second phase, we can see that in recent years, the consumer has slowly become the mainstream of E-commerce, that is, the user's consumption behavior has been cultivated, slowly he began to be not satisfied with just buy cheap things, buy unknown brand, more is to buy safe, reliable, service-guaranteed products. But we can also see that the line of the conflict began to increase, I have access to a lot of traditional brands, whether or not the channel business, they are very painful. Brand maker says if I get my brand online, unless my brand is very strong, I will face the price problem, I sell 500 dollars of clothes online, but the same price on the line may not sell, because there are many competitors online competition, unless it is a very strong brand, You can keep the same price on line. If you make a network of brands, many brands do such a try, but rarely see a successful model. or line online under different sections, different team of designers, or online selling inventory, offline selling new goods, and so on, many traditional industries we can see in the experience of very painful game and ego struggle.

In the mobile era, we have observed many new opportunities this year, whether there is a symbiotic relationship, no longer a zero-sum game. The past PC era of e-commerce, in fact, is the new force in the perforated, in the revolution, the old traditional stores are the victims. Of course this year also has a very popular word O2O, many traditional industries are pushing their own O2O strategy. We also have a lot of observation and thinking about O2O, the whole world today has not particularly successful O2O samples, in the local, such as group purchase, but today has not seen a giant is based on the O2O model ran out. The root cause has several points, the so-called original O2O is pulls the line user to the line, this is not the most efficient mode is worth reconsidering. Do traditional retail or do e-commerce, the most important thing is to see an indicator, your gross margin and operating costs of the relationship. For example, Suning gross profit margin of 17 points, operating costs we see its earnings, rent, artificial add up may be 6-7 points, which is the direct cost of selling a piece of goods. And E-commerce, we will be a large number of goods in a very remote warehouse, through the delivery of goods to the user's hands. The former, if sold more, direct operating costs will be lower. The latter is a variable cost, with your size, but the relationship is not very small, send a single past is more than 10 dollars, from the warehouse start count, to the last kilometer. Different industries have different differences in the consumption frequency is not high in the industry, such as mobile phone industry, electrical industry, we found that there is no line under the advantages, that is, do O2O may not be in an efficient way to combat the online more efficient mode. But some industries may have an advantage over the line, for example, supermarket daily necessities, line of the grams is very low, we look at Wal-Mart and many supermarkets, 80, less than 100, gross profit margin of 20%, sell a single go out may earn 20 dollars, store costs may be less than 8 yuan, Therefore, the line in the direct cost is an advantage. And E-commerce does not have an advantage, because each single to send from the warehouse, the user to buy a bottle of shampoo, 30 yuan, your logistics cost more than 10, this model is in fact unsustainable. There are industries, such as clothing, which is a very interesting industry, from the point of view of the cost of the line more advantages, but recently we do three or four-line user survey, there is still a strong demand under the line, because the clothes to try, to touch, including we see a lot of three or four-line city users of the market brand very strong awareness. Recently we went to Yangzhou such a place, he said I do not know the brand of clothing only and so on, but this dress if it is in a commercial building to sell, I know is good clothes. At the same time I sell this dress must try, I must go to the shop, because I have touched, tried to rest assured, especially in winter, I would like to buy a thick coat, not cheap, I can not directly from the line on the purchase, a lot of users demand is online under the common line. Of course, many users like to go to the shop after the test, copied the bar code ran to the Internet.The store is also very disgusted, do not let everyone take pictures, we found that a user has invented a new model, open the phone recorder, with the mouth of the bar code read down, users and merchants in the game.

We are thinking about a problem, in fact, this is the user's needs, why can't we meet them? In the traditional PC Internet age, offline and online are fragmented, so online and offline must be competitive, is the game, offline in the use of their own high rent, into a display shop, users do not care so much, I just went to the line under the test, found that this is the clothes I want, I go online to buy. Of course, the new game, the brand said if so, I simply do not put the new goods on the line. We can see many brands on the line of flagship stores, often sales of the season, the new style is often not online sales. At this time the line is fragmented, the user's needs are not met, users and businesses in the game. We are thinking about a problem, the mobile era appears, mobile phones everywhere, there is a chance to connect the line and offline.

We've also done some recent attempts to scan the user's code, and you won't let them sweep the user's mouth. In fact, we can think about, the user tries the clothes the process and the line process is very similar, we also learned that some of their data, such as stores 50 guests in a day, this is our shop UV, there are 20 people tried clothes, we will join the shopping cart, 10 pay, conversion rate of 50%. The traditional time, the front 40 customers have no relationship with him, he only know the back of 10 customers, even not necessarily know, because in the department store clearing, clearing is the department store to take away, he did not know what the customer is all about. Online These user's data all in Merchant's hand, joins the shopping cart, you two days send a news to ask him to buy not to buy. Traditional shopping malls, if the user tried not to buy, the clerk can say that you can scan down, and then go back to think about whether to buy, or broken code, or no such color, perhaps the head office of the inventory, these users need to release. When it comes to this, brand-makers are excited, in fact, this is the offline business digital, one day the next line of business like these online shops, you can be your own business and customers all digitized, I think this is in the mobile era mobile electric business is very big characteristics. Offline stores are no longer limited by physical space, users leave the store or have the opportunity to communicate with him through the micro-letter and touch. At the same time we can see the so-called CRM management, CRM is a very old concept, in the past this is a membership card, mass SMS, promotional and other traditional several axe, but in the era of the smart machine, through the micro-letter communication attempts, through the offline business, will touch the new user into your micro-letter work number to listen. At the same time with the contact of the old customers, it is not only SMS sent to him that I have another promotion in the shop tomorrow you come, so heavy a way, but through the micro-letter so much more rich mobile Internet multimedia display mode, you can directly online with the user to start interaction. The same as the electric dealer's peers know that the flow is also very important, in the traditional PC Internet age, users search you can reach this user, but in the mobile era, users outside shopping, through the LBS system, can publish information anytime, anywhere, he pulled to your store.

Big data, when you have digitized information, how to apply it is very imaginative. The most difficult thing we can say about big data is how to own the data, and the premise is how cleverly you digitize the actions of your business and the processes that you work on. When you have all of these business behavior digitization, many of your business management, process management will have a lot of room for imagination. At the same time we can see the extended line of services under the scene, when the customer is stuck with your phone, these customers no longer like before, come to the shop is just a guest, leaving your shop may you never know who he is. Mobile era, there is a lot of room for imagination when you have the means to stick to your potential customers in a variety of ways, that is, we have the opportunity to move a lot of the online business model to the real line.

In general, we feel that the arrival of the mobile tide, online and offline is no longer fragmented, in the traditional PC Internet era, users can only sit in front of the computer, E-commerce practitioners can only sit in front of the computer. I think the earliest time, see the first wave of China's e-commerce began to develop, Taobao's first wave of sellers, in fact, many from Shenzhen, overseas Chinese and the computer city of the small sellers, why they become the first wave of E-commerce power, very simple they have computers, they are selling computers, they have a computer has it ability. But today we see a lot of traditional retail industries, and their practitioners don't have the opportunity to use computers, this makes them in fact by the traditional PC E-commerce abandoned, because later do sell clothes, sell shoes and hats of these people, in fact, are in the office to rent a computer, rented warehouse, the goods pulled over, do through train, decoration shops, There are many ways to do it, using many high-tech means to compete with the traditional retail industry offline, where these stores are the victims. But when the mobile tide comes, the threshold of it is reduced, the theory of every shop assistant, every practitioner has a mobile phone, you can communicate with customers anytime, anywhere, mobile phone low threshold of the camera ability, customers ask you this dress has no goods, with a mobile phone can be a beat. The threshold for it is lower, and it is likely that the future of traditional retailing will be revived through mobile internet.

The same is true for users, today we can see E-commerce, although the development is very vigorous, but for a lot of traditional brands under the line, may be online business or not more than 10%, 90% of the business is under the line. Also from the user's point of view, a large number of users still have to go outdoors, or need to go to the mall to see movies, eat, to experience, offline retail activities will not perish, but we can provide a more complete line under the online more integrated experience, more smooth and convenient shopping experience. I think this is the arrival of the mobile tide, the user's scene into one, the scene of The merchant is also a combined, very exciting opportunity.

Overall, I think 2013 is a year of change, the Internet industry people feel very profound changes in the year. I also believe that mobile internet in the future, not only to the Internet industry, more is to the traditional industry to bring profound changes in opportunities. I also look forward to working with all the traditional industries in Guangdong Province, the internet industry, E-commerce industry, all of our colleagues to explore the great exciting opportunities. Thank you.