How does the word "potential" change to "real" demand?

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"Guide" Why people praise your product but do not buy it? How to turn the fence into a customer? How do you turn "potential" requirements into "real" requirements? How to create demand? This article takes the US Netflix (NM) company as an example, recorded it from the creation to the business, to expand business, to defeat the Giants, And the whole process of becoming a giant. Million word text, recommended! (This digest from Adrian Slevosky's "demand" a book, Zhan-Lu culture produced. )

That was 2001 years. Four years ago, Ride Hastings, an entrepreneur, had failed to pay a fine of 40 dollars for the movie CDs that were on loan. Three years ago, he was inspired by the trouble, set up the company, creating a new era in the film rental industry.

First of all, new ideas for test and inspection

And with the birth of the DVD, further aroused the interest of Hastings. The DVD is lightweight and is more easily delivered to customers than large, heavy, and easily damaged tapes. To verify the idea, Hastings bought several CDs (DVDs were hard to buy at the time), stuffed them in envelopes, posted stamps, and posted their home addresses to a nearby post office. A few days later, the CD was sent to his home. Worry is superfluous, the CD disc is not broken, but intact, playing smoothly.

Later, Hastings learned that sending DVDs by mail was not as simple as the first experiment. But the initial success gave him confidence and enthusiasm. Perhaps the combination of the Internet and DVDs, he thought, could create a new type of retail model, abandon the cumbersome film leasing process, an anti-blockbuster, movie gallery (Movie Gallery), Hollywood film and Television (Yap video), and thousands of family studio-style rental shops.

Pound。 Hastings and several other members of the team set out to create the original nano-fly site for people to choose films. They built a warehouse near the corporate headquarters of Scott, a small town in northern California, to send DVDs. They bought a lot of different styles of films and started to advertise.

Their first product, however, is far from the standard of magnetism. Like now, there are two of online movies and mail delivery dvds for people to choose from. However, the rental standard is basically the same as the traditional shops, each film starting at 4 dollars, and even set up a late penalty system, and Hastings was the first to get inspiration from the trouble. To attract attention, the new small company is also trying to sell "hot products" that other retailers cannot get, such as a recent concert ticket, entertainment poster and other small items.

The customer heard that the company's business, basically no response. At this point, the situation is really better than the traditional film rental shop, but also not good to go. If we want people to go out of the fixed habits of the past, and start to practice a new type of consumption, we need more magnetic force to achieve.

Hastings soon learned the truth. Over the next few months, the company has carried out many reforms, so frequent exploration and experimentation is truly a reflection of the complexity of demand creation.

Hastings changed the business model. No matter how many movies you watch, only one registration fee is charged, and a late penalty is canceled, with 078 pieces that are irrelevant to the film's product. These products, while helping the company to raise a bit of visibility, but in the intangible harm to the customer's demand for mainstream products. Hastings invests in a large number of films to solve the toughest problem in the movie rental industry--You can't find the movie you want to see in your local rental store. In addition, he has tried various pricing systems and different price levels.

After dozens of redesign, Hastings finally found the ideal business model, and today's nano-fly is very close to, it is full of magnetism, fun and useful products to stimulate a steady stream of huge demand.

The second section of the dilemma

In the 2001, however, the river of demand was still in dry season, at best a stream. At that time, there were less than 500,000 registered users in the country. Although it is a remarkable achievement for a new company, the 500,000 per 130 million film consumer family in the United States as a whole is negligible. And, in the face of the 5.1 billion-dollar turnover of traditional film-rental companies, the revenues of 7, 6 million dollars, are dwarfed.

Hastings is convinced that the product is more convenient, cheaper, and will hardly bring any trouble to customers, so it is better than blockbuster products. He's not a huge customer base. Very much like the service of the website, the survey also shows that a large number of potential customers have heard of the Nai Fei. But even so, growth is still very slow. What is the reason?

For 2001 years, it is particularly urgent to solve this problem. Eventually, Hastings believes, a big company with the wherewithal and experience will see the same opportunity to march aggressively on its highly influential brands in the entertainment, retail or online industries. He was well prepared to think of a day when he would see the news in the headlines: Blockbuster invested 500 million of dollars in the online movie rental industry. Then the little dream of the fly was gone. Or, if not blockbuster, it will be Amazon, or Wal-Mart, Apple, Disney ...

Hastings at this time the only hope, is quietly, secretly, fast to let Nai fly to grow up. Only in this way, when the big crocodiles decide to work on the online movie rental business, it will take the opportunity to take advantage of it. In the eyes of Sinai, slow and steady growth is simply unacceptable. #p # subtitle #e#

Section three find the valve to open the demand

Why are no more people registering as Web users? This question has plagued Hastings and his team.

So what's the difference in the Bay Area? Compared to Boston, Chicago and Miami, why does the product of the Chennai have more powerful magnetism here?

Each member of the management has his own set of theories. Hastings stood up and terminated the controversy. "Stop talking." "Let's start doing some research," he announced. "Thus, the company launched a large-scale investigation, the United States in a number of cities in the existing customers and the general population of the attitude of the fly to the detailed analysis, the goal is to understand the firm's products in the Bay Area more magnetic specific reasons." The day the survey was unveiled, it seemed as if a beacon had been seen.

Effective questionnaires from customers in the Bay Area show that there is only one difference in the region compared to other regions. This is a major finding, and it is entirely possible to explain the difference in registration rates. Almost all of the users in the Bay Area have reported receiving the movie quickly, while users in other regions have no experience.

This revelation suddenly awakened the management of the nano-flight. The real difference is so imperceptible. Originally, the local responsible for mailing DVD distribution Center is in the Bay Area! So, for customers who live in Oakland, San Rafael and Palo, if the film is returned to Nigeria by mail in the morning of Monday, then Tuesday can reach the company's warehouse. The next film that the customer subscribes to will be mailed on the same day, arriving at the customer's home in Wednesday. Turnover is less than 48 hours.

In contrast, customers living in New Haven, Baltimore and Seattle will have to wait four days, five days, or even six days to get a new movie. In this time, the customer will gradually forget about the fly, because there is no way to know which day to receive a new film booking.

Efficient and convenient delivery of services the next day is to make customers excited about the key point. The moment the movie was dropped into the mailbox, people began to look forward to the next movie, and recommended a fast and reliable service to their friends, family and neighbors. The five or six-day turnaround of the film delivery service is not recognized by customers.

The subsequent events really reflect the success of Hastings, the creator of demand. At the moment when he realized the shocking facts, he decided to act on it.

The reality is somewhat ironic. It was founded on two major technological breakthroughs-the Internet and DVD discs, and the excellent software developed by the highly intelligent programmer team. The company is a typical product of the High-tech world. To the dismay of the company's leaders, however, the secret weapon behind the success was the US Post office, a low-tech delivery system created by Benjamin Franklin 200 years ago and operated by government employees.

January 21, 2002, Nai Fei's second distribution center opened. The center is located in Santa Ana, California, south of Los Angeles. The third center in Worcester, Massachusetts, west of Boston, was opened in February. Over the next few weeks, Hastings and his team watched the registration of Los Angeles and Boston closely, finding that the number of users had climbed steadily, and that the Bay Area had doubled the normal registration rate. The users of these areas found that they could receive new movies within just 48 hours, so they passed on to their friends and neighbors, and then friends and neighbors joined the Nigerian.

This is the only reasonable explanation for the rise in the number of users. Because Nai Fei always with the attitude of scientific inquiry, deliberately do not use local advertising and promotional means, lest affect the judgment of the effect.

Within a year, another 9 distribution centers opened. In 2003, 12 more were added. Every area that opens a new distribution center, the number of registered users will double immediately. One after another the city as if opened the valve, for the nano-fly, demand is like a key to the ignition of the car, in the driving force, a twist on.

By the end of 2010, the company has a total of 56 distribution centers, the vast majority of Americans can enjoy the film the second day of service. Today, the nano-fly users have reached 2 0. From this figure we can see that the Hastings team to create the needs of the engine also has a broad development space, can increase horsepower forward.

As early as 2001, Hastings and his team have created magnetic products, the first key element of new demand creation. However, a magnetic product alone is far from enough. What was missing in 2001 was the propulsion of demand. And this propulsion is a vital part of business design, and it can make the cold fence warm and ultimately willing to become the customer of this magnetic product.

In fact, we have long witnessed the effect of propulsion. Remember how density helped Zipcar become a household car rental company? How does instant access to books make the Kindle far more competitive? It is these propulsion forces that open the valve of demand. Also, delivery speed is the key to the propulsion, with it, there is growing demand.

Each of us has experienced the great power of demand propulsion. Recall a quality product you recently purchased. Think about this: after you first heard about this product, how long did you finally decide to take the money or credit card and take it home?

Heard of a product, and the actual purchase of this product gap between the demand for propulsion. Propulsion works by enabling the customer to overcome the old inertia while strengthening the magnetic force of the product.

Some propulsion focuses on the specific functions of the enhanced magnetic product. For example, to improve the price of products, make the use of products more convenient, or easier to customize. Others are aimed at arousing the emotional resonance of consumers: excellent advertising, promotion, promotional methods, or Word-of-mouth marketing campaigns can achieve this effect.

Some propulsion improves purchase rates by providing consumers with the opportunity to test the performance of their products personally, such as giving away samples, free trial or discounted membership. Propulsion, which has a lasting impact on the magnetic force of the product, is more powerful than the propulsion that is passing along. The fast-flying film service is the typical representative of the former.

The magnetic product itself is very precious and beautiful, but if there is no propulsion, even if the magnetic force is strong, may not be able to attract much demand. That's why we're trying to find a propulsive force, or even two or three different propulsion. All the stories about demand creation, propulsion is one of the highlights. #p # subtitle #e#

The fourth section aims to imitate with the unique

In 2001, Hastings and his team had shed three years of sweat on the road when they realized the true meaning of service the next day. It is because of the accumulation of previous hard work that this propulsion has the opportunity and platform to exert its power. Like the story of Zipcar, the Kindle and the company, the legend of Chennai truly reflects the difficulty of creating demand. Behind every successful demand creation team, there are too many clever tricks to hide.

Hastings has accumulated rich experience in the process of establishing and developing pure software company. He likes to say, "My last company did a mediocre job, but I got a valuable asset from it." "The pure software grew from 10 people to a company with 640 employees," I found myself powerless. Losing confidence, he even volunteered to ask the board to fire his squid. After selling the company in 1996, he felt a relief from the bottom of his heart. After a period of time, he sank down to experience, lessons learned, for the next venture to accumulate strength.

One of the lessons learned by Hastings is to make use of external resources to create background elements, but not all by themselves, from scratch to create their own products required by the background elements. You will never have enough time, money, talent, or emotional energy to keep up with all the cumbersome and trivial background element details for your product in the process of pursuing the vagaries of new demands. To waste the effort to repeat the work done by the predecessors and devote valuable resources to it is tantamount to digging a grave.

So Hastings and his team did not want to design and build their own delivery facilities (like retailers investing in real estate and building hundreds of physical retail stores), but instead focused on thinking about how to effectively use existing delivery facilities. This is the delivery system that eventually leads to basic demand propulsion--the US Post office.

However, practice has proved that there are many difficulties in the delivery way of the postman's hand-carried shoulder. Ride Hastings did a small experiment and sent out a batch of CDs by mail, which showed that only one local post office, in a particular case, could safely complete the delivery of the disc. Post offices across the United States vary in size and level, from the Wyoming and Alaska country stacks to the city's mail-processing centers, which use a variety of technology-intensive machines to sort through large volumes of mail parcels. If you want to serve customers across the country, you will have to work with all the post offices, as well as minimize damage to the disc during the delivery process.

Imagine that you are a passionate film enthusiast who has just become a member of the Nai Fei. How many pieces of dusty, frayed discs can you lose confidence in the service? Two copies? It's not going to be any more.

Jim Cook was one of the early members of the Jim Cook team. He recalls:

In order to understand the operational benefits inside the post office, I spent hundreds of hours in several large regional postal centres to observe and raise countless questions.

I found that the mail was sorted by several high-speed rotating drums. These "savage" drums do handle more than 40,000 standard letters per hour, but fragile plastic DVDs are definitely not going to go through the sorting process intact. My heart sank and felt that our business plan could not be a reality. But then I noticed a conveyor belt that specializes in sorting magazines and other bulky "flat mail". But how can I make sure that our mail can be used on such a conveyor, rather than a roller-type device for sorting?

So, Nai Fei began to design a special original envelope which can automatically enter the flat mail sorting system. At the same time, the envelope should protect the safety of the DVD, prevent access to the removal device, and with a postage prepaid return envelope, so that the staff of the Nai Fei Warehouse will not scratch or miss the disc in the envelope. Moreover, the envelope should be as lightweight as possible, because every bit of weight means that the company will have to pay an extra postage.

The process of the envelope experiment is long and tortuous. In the beginning, I tried to design envelopes of paper, cardboard and plastic. (Plastic envelopes were soon shot because they could not be recycled.) Some envelopes are designed with foam structures to wrap and protect DVDs. (The idea was shot too, because it was too heavy.) Some are designed to be sealed in form, which means inflating when airborne. (A small airbag is added). Some designs require the user to tear a sticker to see the return address of the nano-fly. (Too complex.) One design, the user guide includes up to 8 points, a total of 76 words.

For the design of the mailing envelope, Nai Fei repeated the modification dozens of times, and finally got the perfect results. In the design process, there will always be a novelty of the small discovery, such as the inside of the return address reversed to print, you can make users more efficient use. Finally, they designed a lightweight and sturdy paper envelope the interior is equipped with a baffle that acts as a protective and solid disc; The envelope is designed with a small, transparent window that reads the barcode on the DVD without opening the envelope, and even leaves a space for paid ads on the envelope. The final winning envelope is designed to be simple, bold and eye-catching. Most importantly, the envelope is capable of carrying discs through hardships's post office equipment, and the damage rate is far below 1%.

You may be familiar with the look of this envelope even if you are not a member of the flight. It is a unique bright red, in many post offices, this envelope has to occupy One-fourth of the Daily Mail volume. The annual mailing cost of up to $500 million is an important part of the U.S. Postal Service budget.

The 150 envelope designs may sound too meticulous. But it is because of the flying design team to each of the small details of the obsession, in order to resolve the user face every little trouble, even if a small little improvement, but also to do.

At the same time, Hastings and the team also have to deal with a number of other aspects of the details of the product for the nano-fly to give real magnetism. We find that such attachments are common to great demand creators. In the need for innovative spirit, they play a strong creative power, and in need of imitation, they can be copied at any time.

After months of experimentation, this team of direct mail executive experts, mechanical Engineers and software developers, based on a unique high-speed optical scanner, has created a superior distribution system that can be sorted and dispatched millions of DVDs a day, with very low error rates. When we visited the distribution center in Fimon, California, we were stunned by the sheer volume and unparalleled efficiency of many of the people who were fortunate enough to visit the site. Its system is unprecedented in size and complexity, and the mere existence of the system is enough to deter companies trying to put in competitive business.

In order to avoid wasting valuable economic resources and creativity, Hastings not embrace the beginning of the heart

State to design the site, but after a careful study of Amazon's website, made a similarity of more than 90% imitation version. The company directly copied Amazon's navigation systems, product and option locations, search tools, user reviews and expert introductions, and even the low-resolution cover small picture that helped the Web download quickly.

In order to achieve rapid and low-key development, Hastings made full use of viral marketing and word of mouth promotion way, and did not extravagantly ads. He also found a marketing partner to help fly the number of registered members. Sony, Toshiba and Panasonic three companies occupy 85% of the U.S. DVD player market. Hastings has reached an agreement with the three companies to give each DVD player a free beta test account.

In normal circumstances, manufacturers are unwilling to agree to such agreements. "But then," Cook explained, "These DVD player manufacturers are afraid of the failure of Betamax laser players." As a result, manufacturers readily embraced the proposal by the company to offer 10 free rental movies when users bought the machines. Using the marketing power of other organizations in the same system to create a background element ecosystem that is consistent with its own, not only greatly expands the customer base of Chennai, but also frees up valuable resources to meet other challenges.

In order to solve the problem of one after another movie leasing process, Nai Fei continuously improve the product. And the great creator of demand will always have to reflect on such a problem; what can we do to help our clients connect all the background elements? From the point of view of improving product value, nano-fly not only provides the rental of film, but also designs personalized service arrangement, including movie selection, Movie preview, Critics ' opinions, advance bookings for new films, etc.

However, the most powerful boost for the Cinematch product is also considered as a recommendation engine. In this regard, Hastings has again borrowed from the world's leading online retailer Amazon experience. Amazon is a pioneer in the idea of algorithmic product referrals. Based on the user's previous scoring behavior (which averages over 200 films per member), Cinematch can predict the user's scoring of a particular film. The system is so popular that 60% of Cinematch users will pick up the film on the basis of billions of recommendations each day.

The recommendation engine, coupled with a personalized arrangement system, targets a very troubling problem in the traditional movie rental industry--which lingered long in the corridors of the rental shop in the evening of Friday, but never picked the movies that they wanted to see. With the help of Cinematch personalized recommendation, as long as the creation of their own nano-flight arrangement, there will be a ready to call the list of movies, including 10, 20 or even more tailored to your preferences for your choice of movies. As soon as the order is placed, the movie will immediately embark on a journey to your home mailbox.

As time passes by, Hastings and his team are constantly optimizing and improving their products, learning from mistakes, summing up experiences, and constantly looking for opportunities to further improve the trouble maps that customers face.

With the changing circumstances, the product can be improved to meet the rising expectations of people. Faced with this fact, Hastings and his team have a profound understanding of the inherent. They start thinking, detailed analysis, in a high-intensity way to study the changing customer shape. Every day, Nai Fei will conduct an average of about 200 surveys and user interviews, including online, telephone, e-mail and on-site investigators door-to-door research and so on. The company's employees take on the role of "media anthropologists" who sit with users to watch movies and TV shows and observe the behavior of their users at any time. When and how do they press the pause key? Where do they put the remote? And when and why did they end the watch? Subsequently, the country's offices will regularly hold customer focus group activities. In the course of activities, not only the marketing Commissioner needs to participate, but also in order to solve the activities of the study of the customer issues, responsible for writing software code engineers to participate. There are also a variety of routine customer inquiries, such as sending emails to members asking if the latest movie was received in a few days (hundreds of thousands of such emails are sent every day). When there is a matter of urgency, NAI can complete the investigation within 24 hours and immediately receive feedback on the status of the member. #p # subtitle #e#

The fifth quarter of competition, constantly give the motivation to the endurance

What are competitors doing when Hastings and the team are working hard and the business is booming?

The answer is, nothing. The answer may be shocking. A few months have passed. In the blink of an eye, a few years passed. The growth of Nai Fei was slow at first, but it showed a growing momentum after discovering the propulsion of postal speed. Blockbuster did not respond. Wal-Mart, Apple, major film studios and other big media companies have not reacted. The new demand, seen by the most threatening rivals, seems to have turned a blind eye.

In the 4-year period after its inception, none of the big companies in the industry, such as blockbuster, took any action. It was not until 2003 that Wal-Mart finally set up its own web-based film rental service, and its share price fell. As for the world's largest company, any news can make a competitor shudder. Who Chengxiang, in 2005 years, Wal-Mart has voluntarily withdrawn from the film leasing industry, its own insignificant registered user group to the fly.

In the same year, 58 months after the founding of Chennai, Blockbuster entered the battle. By contrast, blockbuster mailing services are cheaper and the number of films is more (25 000:20 000). The shares fell sharply again.

However, the rapid and decisive response to the strategy, as if long awaited the arrival of the day. The company quickly lowered the price of its products, flat against blockbuster, and quickly increased its reserve. By the end of 2005, the number of films in Chennai has been much higher than that of blockbuster, and has maintained this advantage until today. At the same time, the company accelerated the pace of improving the recommendation engine.

Blockbuster is not sitting still. The development and promotion of online business, blockbuster extravagantly, invested 500 million of dollars. At first, Blockbuster separated the two types of business completely and became independent. The strategy looks somewhat odd, as the company is not taking advantage of its biggest potential-a huge chain of entities. But by the beginning of 2007, Blockbuster changed its previous strategy by announcing a new project called Full Access, which links online services to physical stores as well. Blockbuster's Mail service customers can now return the discs they have finished to any blockbuster store, replace a free movie, and receive the next online subscription by mail.

The service is attractive and is the first new magnetic product ever launched by blockbuster for many years. In the second quarter of 2007, it was the only time in the history of Sinai to have a decline in registered users. The reason is that people are thrown into the bosom of blockbuster. Once upon a time, Hastings's most feared nightmare, the rise of blockbuster, seemed to have really become a reality.

But the "full access" service poses two big problems for blockbuster. One problem is that many franchise chains are unwilling to participate in the project. Another problem is that the "Full access" service contains too many free videos, each with more than one registered user, which means thanks to a penny.

Hastings, who worked with the team on blockbuster data, soon realised that Blockbuster's victory was a flash in the pan, with no incentive to keep it going. As a result, the decision to continue to develop according to the original plan, and constantly improve their own product quality, and silently look forward to the early hundreds of the end of the road.

In a few months, the winning and losing of this battle will be a foregone conclusion.

By the middle of 2007, Blockbuster decided to radically change the "full access" service plan to deal with financial pressures and concession dealers ' complaints. The company raised rental prices, dramatically reducing the number of free replacement films and returning the stores to the film from free to charge. The new "Full access" service is a rather awkward choice for users, from one months 8.99 U.S. dollars, one rent, a pure mail service, to one months 17.99 dollars, one rent 3, a month in the store for 5 of the mailing and store dual-use services; there are several other options between the two types of prices. Many users are confused by the new service, and there is no enthusiasm or motivation for service revision.

The consumer review website Gizmodo the changes to the blockbuster service and concludes, "We want to thank blockbuster because with you we can only recommend the service." ”

After the dust settles, and then to look at the online film rental industry, we found that the leader of the nano-vision of the trend of the rise. The number of registered users has again been picked up. By the end of 2008, the value of the market (measured by the total value of the tradable shares) had been 10 times times that of blockbuster. By the year 2010, Blockbuster had declared bankruptcy. In 2011, Blockbuster's commercial assets were auctioned off.