Keywords in business model

Most of the business model, whether the game or the community, the Internet or mobile internet, search or electric business, the main line with four key words can be clear: arrival, transformation, retention, transformation.

These four links are funnels, regardless of the user from what way, all along the funnel down, the more leakage less. So each link will have a "rate", that is, the outflow, to remove the inflow. For example, the arrival rate, conversion rate, the rate of change, pay.

At both ends of these four keywords, there are two "quantities", one is called "exposure", and the other is called "ARPU" (Average Revenue per user, which is the average sales generated by each).

People are interested in, each enterprise has two important functional departments, one called "marketing department", responsible for the most catchy funnel, hit money pull people come in; a "sales department", responsible for the most of the funnel, from the user's hand to find ways to collect money. Perhaps because the two departments are directly related to the money, often the boss of the most important departments, but also may be the work of other departments around the two departments. The work of these two departments, the most easy to be KPI, in layman's terms, is: "Big hit advertising more money". Here, someone might feel a little bit--isn't that the core KPI for most companies? Moreover, many managers in describing the company's performance is not good, often use the mantra is not "bad market", or "bad sales."

It may have been impatient to be seen here--what you said in a business school, the most basic logic, what can be said? Old Jane has not gone to the business school gold-plated, but the old Jane is puzzled, why so basic business knowledge, the actual implementation, or a bunch of famous enterprises are not clear?

Doing business is to make money, economical to make a lot of money is the dream of every entrepreneur. So the core ability of the enterprise is long-term sustainable earning ability, spend money to throw people's things will do a lot of people, as long as the funnel is pass, as long as the amount of people increase, end sales will always increase. Exert more pressure on the sales department, and the short-term performance will increase. But is this all business?

The professional marketing director at the market end will first find a marketing channel with the highest ROI (which usually means relatively accurate), but such channels are always limited, so if you want to improve the flow requirements of the previous section, ROI must be reduced, that is, the market costs to each customer will rise, so, Unlimited increase in market input will become increasingly uneconomical.

What is the most efficient way to do sales? Cheat highway robbery, guaranteed high ARPU high pay rate, the problem is that there is no sustainability. Every company expects to "squeeze" as much oil from a single customer as possible. But they often forget that the customer is not a fool, when you provide a value significantly higher than the cost of customers, customers will repeatedly buy, and even pull friends and relatives to buy. When you provide the value of customers feel "expensive", "low cost", will reduce the desire to purchase, resulting in the funnel conversion, repeat rate, the rate of each index is inferior.

Alas, there are a fair number of companies and business leaders in the market, not marketing addiction, or simply believing in sales-driven, and it's true that a lot of speculative businesses are making money in the short term-if it's just a short-term way to profit. But the hope that such enterprises have long-term value is impossible. Excessive sales of enterprises will taste the bitter fruit, last year, there is Li Ning, Baidu this year. It is the old saying, come out of the mix, sooner or later.

Throughout the recent years, the first vigorous and heroic after the sad solemn and stirring company, ten, are based on the market expansion and sales-driven as the main business objectives. And at home and abroad, whether online or offline, can create lasting value of the great company, are in the intermediate link, that is, "transformation" and "retention." "Transformation" and "retention" competition in the market and sales of the implementation of more brain, more complex management, but this is a sustainable, barrier ability. That's the real competition.

Far-sighted companies, will be real and their customers, upstream and downstream a total growth, at the expense of short-term benefits to promote the ecological environment to become better, not only know how to plant grazing, but also to understand the way to conserve water and soil. Mountain High forest dense, aquatic plants and lush only long-term rich.

In the short term, market inputs and sales drivers can indeed achieve good performance growth, but in the long run, the core competitiveness of enterprises lies in the ability to continuously control costs to create beyond the customer's expected value. When you are in marketing, product delivery, customer service This area of writing, find key value points, creative solution to the problem, so that customers get, feel, recognition, then other problems can be easily solved. If you do not focus on the company's main focus on customer value creation, and placed in the market, sales level, so that product energy, technical staff to run with sales, enterprise competitiveness will sooner or later collapse.

Therefore, in the arrival, transformation, retention, change four links inside, the middle two links, and the company's competitiveness is closely related. Ultimately, it is the ability to create perceived value for your users and customers.