Electric business management turns to focus on management, and attaches importance to its own hematopoiesis ability

2014 will be the transition year of the electric business management--from the past one-sided pursuit of scale, regardless of the cost of expansion, to focus on management, attention to their own hematopoietic capacity.

With the change of status, I can look more objectively at the 10-year change in the industry from the practitioners of the electric business to the current investors and bestselling authors.

The electric business industry from originally is the retail channel supplement, now dominates one side, the rapid development is obvious to all. But it can also be seen that, in the case of Taobao, the annual growth rate was above 90% per cent before 2010, but growth slowed to around 60% from 2011.

In fact, the electricity business is not only the growth rate slowing down, the problem is followed.

Traditional electric business model faces collapse

Do electric dealers really make money? Really effective rate? Every time a price war is fought, people question whether this crazy horse-racing pattern can last forever.

We will find that the electric dealers desperately playing "price war" behind what? First, the financing of burning money, subsidized sales, by financing subsidies to pull the transaction, and offline retail sales have been prohibited subsidies to sell behavior; second, there is no goods, customers, only a few low-cost but a very limited supply of goods to attract users eyeball, do fishing promotions.

At the same time, Taobao, such as E-commerce platform Enterprises, has essentially become online commercial real estate companies. Taobao sellers have 55%-60% do not earn money, 30% can barely make ends meet, really earn only about 3% of the money. Although platform providers do not want a few big sellers to control sales, Taobao has been emphasizing "small and beautiful" to support the growth of small and medium-sized shops. But the larger the bigger, the smaller the small, the new people will become more and more difficult to do business, is the platform model inevitable outcome.

It can be expected that with such speed and scale evolution, the electricity market dividend period is coming to an end. And the merchant will also gradually discover, this is a 0 and game, with the same line, only a few successful people, more just become the denominator.

Bullish on the future of the vertical electric business

The reason why I write two electric business books, is that the industry to change the moment, the 2014 will be the transition of electricity business management--from the past one-sided pursuit of scale, regardless of the cost of expansion, to focus on management, attention to the company's own hematopoietic capacity.

Here, my advice to the electric business industry is: "Profit is the hard truth." "The important proposition that companies should think about is how to really keep the customers who are paying a lot of money through better models and products, rather than relying solely on venture capitalists and the gold lords behind them to overdraw their future."

At the same time in 2014, the need to pay attention to the "mobile" wave, for a new generation of consumers, mobile shopping is the kingly way, personalized, differentiated and fine differentiation is the trend.

This also reminds the electricity business sector, the fine operation "small but beautiful" mode is very important. So I am very optimistic about the future of the vertical electric business, the big platform model is not unique in the internet world, focus tends to produce greater efficiency.

2014 Management Vane

Q: At the same time, the transformation of the electric business industry, what opportunities and challenges for traditional enterprises?

A: In the more mature North American market, the traditional enterprise is the real electric business leader. This shows the potential for market segments, and now the Chinese Internet practitioners of the current situation will gradually change in the future, return to the nature of retail and customer demand.