When everyone thought about Meituan , the first thing they said was not that Meituan turned yellow, but that the other four words "Meitan became yellow". Changes caused by any large platform will have a great impact on the industry. Platforms are something that sounds simple but is harder to understand and harder to do. So, how can we survive better as a platform? How can entrepreneurs effectively find their direction? Let’s take a look at the five essential thoughts summarized by Zhang Chuan, senior vice president of Meituan Dianping and president of the in-store business group, based on years of practical experience.
This article is compiled from, at the 10th Changjiang Qingtou Forum of the Yangtze Business School on September 3, Zhang Chuan's keynote speech entitled "Five hurdles of the platform - the survival rules of the secondary platform under the super platform"
" We all belong to entrepreneurship, and even if Meituan develops to this day, it is not enough to call it a good existence. As long as it is not a company with a net worth of US$150 billion, it will die at all times within 30 days. This is the result in global competition. "
1. Dynamic imbalance is the basis for the existence of the platform
Everyone dreams of building a platform, which is the same as everyone dreams of doing foreign trade in the 20th century. The first level encountered by the platform is called whether it can identify extremely unbalanced businesses on both ends and maintain imbalances on both ends through operations and products, so as to ultimately achieve the value of the platform.
For example, when we book a hotel, we obtain all the hotel information on the platform, and after payment, we generate a transaction. If there is no room after going there, all platforms will be responsible and responsible for changing rooms for you. There are several levels of transactions between a platform and a user, including if you buy things, you will return and exchange goods for 7 days without reason. This is how to become a real platform.
Many platforms were unable to be made from the beginning, and they are still very small after 10 years of development. Why? Because dynamic imbalance is not maintained.
dynamic imbalance, that is, the activity of this market is high enough to not produce a process where a single user and a single service provider reach the same transaction multiple times over a period of time.
For example, if you buy things from Merchant A today and Merchant B tomorrow, it is dynamically unbalanced; if you stay in a hotel, live in Shenzhen today, and may live in Beijing tomorrow, it is also dynamically unbalanced; you may think that taking a taxi is dynamically balanced, because you are taking a taxi every morning, but in fact, the drivers who appear in that location at the same time are different from the time point. The basis of the
platform is that the two ends must form a dynamic imbalance. Only when the two ends are dynamically unbalanced can the platform have the value of survival.
is the supplier on one side and the demand on the other side. If the dynamic balance is achieved, the two sides do not need the platform to play the role of exchanging information, intermediary, building trust, establishing transactions, and serving both parties in the middle. This part mainly considers the most common Two Sided Marketplace (bilateral platforms) in the business community. For example, Taobao, Meituan, and Didi are typical bilateral platforms.
Basically all platforms with rapid development and fierce development are dynamically unbalanced.
When many people started their business, they thought that I built a platform, and there were many merchants and individuals here, and there were many users there, but why couldn’t the platform be transferred?
This involves two traps in dynamic imbalance: looks dynamic imbalance on the surface, but it is actually balanced.
The initial imbalance is, the end balance is
For example, tutoring, beauty and hair salons, the initial state is unbalanced. However, because the service process is mainly a process of communication, if one person’s service is often used, a lot of emotional dependence will arise between the user and the service provider. Beauty often becomes emotional talk, so naturally there will be no replacement.
When the equilibrium state occurs, people will start to make transactions privately, and the role of the platform will become less and less obvious. nanny, hourly workers, home cooking, and car repairs are all like this.
Two days ago, I met a friend who went to do a training project. Here is a professor who talks about management, and there are training institutions and companies.He said if I build such a platform, will it work in the end or not?
is actually very simple. All users only focus on the oldest person on this platform, and only focus on the person who can give him super trust to solve problems. This is a traffic trap, and this person does not essentially need so much service. For example, a doctor can see 40 patients a day. When he is famous enough, 40 people are full of people a day, and even after two years, there is no need for the platform to provide him with users.
When the value of the platform no longer exists, those who really want to gain users on the platform cannot gain users. So when an expert grows up, he will exist without the platform.
How to get out of this trap and make breakthroughs in the above industries? is either a control person or a control of goods.
control is the new exclusive professor. The class you teach cannot be taken on another platform and will not cause homogeneous competition.
control is to generate standardized courses, such as Drucker standardized management courses, and ram Charan standardized courses. No matter who takes this class, the patent for the class can only be mine, which is like some training institutions today.
Two days ago, a medical beauty consulted me and said that all overseas medical beauty service institutions were listed on his supply side. I gave them a comment, and everything he has here is a user, can he build a platform similar to , Dianping ?
I said this is impossible, because whether it is a physical examination, a beauty treatment there, or an operation there, he and the service agency must have a strong sense of trust and a long-term connection. Therefore, there is only one possibility that can you control all overseas service institutions and turn them into your own institutions to create a platform.
If you look at the example, it is actually very simple. Look at the development of 58 Daojia in the past four years, from a platform that does not control nanny to a control nanny and training. If there is a problem with the nanny, the platform is responsible for changing it, which means that it is not a transaction between platforms A and B, but a platform C plays the core transaction scope.
Platform Expert Trap
If the platform is a platform based on knowledge, especially unique knowledge, it is easy to fall into this trap. Typical are lawyers, doctors, and teachers. Platform users like
are very expensive to choose, and demand will be concentrated on experts. When the platform raises good service providers, he may leave the platform.
For example, someone does the gig economy. China's gig workers have a 3 trillion market and an underground trading market, but there is no platform for gig trading. This is also because people with skills are not on a scale and are completely trapped in the expert trap. Everyone should pay special attention and be careful when building such a platform.
looks like it is an imbalanced relationship, like a nanny, like some hair salons in beauty salons, like a fitness trainer, it looks like a dynamic imbalanced. This is the motive, this is the demand.
But in the end, there is actually a lot of dependence and trust between people, which will eventually become balanced. Therefore, all the companies that started businesses in this area did not become big platforms in the end.
How to crack the expert trap?
In fact, there are two types of people in the knowledge field, one is skilled - expert, and the other is unskilled, ordinary - ordinary service provider.
What we need to do is to select services that are not much different from experts and ordinary service providers. For example, medical examinations, traffic violations among lawyers. These are the directions to explore the standardization of expert services.
2. Standardization determines the size of the platform
Dynamic imbalance determines whether the platform can exist, and whether the things provided in the platform are standardized determines the size of the platform.
standardization of products is easy, but standardization of life services is not easy because there is only relative standardization. So if A and B (the two people) judge that the standards of this service are the same, then this is a standardized product.
So at present, the scale of physical e-commerce is larger than that of life service e-commerce. Of course, as life services gradually become standardized, the future prospects are very huge.
For example, taking a taxi is similar to a standardized product, but moving is not a standardized product. For the previous company, it may take an average of 37 minutes to communicate. We need to talk about how big the refrigerator is, how many floors it is moved, whether there is an elevator, whether the cabinet is removed, etc. This is a non-standard product.
Two days ago, we listed all the top 50 in China and the top 50 in the world. After finding that among the top 50 in China, there are three other companies that produce non-standard products, which are based on service as the core, and there are no more in the top 50 in the world. The first largest non-standard product is McDonald's . We can call it a real estate company with more than 70 billion US dollars, which is half the difference from the 50th place's 140 billion US dollars.
We cannot carry the rules, standardization determines the size of the platform. The more standardized the industry, the bigger the platform will be.
3. Is it a misunderstanding to use low frequency to play low frequency
Whether a platform does high frequency business or low frequency business also determines the value of the platform.
There was a saying in the past - high frequency to low frequency. This is a misunderstanding, high frequency is actually quite difficult to hit low frequency. I think that after high frequency, the low frequency is all destroyed by scale effect and capital force. It is not driven by high frequency users slowly migrating to low frequency.
high frequency has been taken away by giants, including food, clothing, housing, transportation, and entertainment. All information is in entertainment. Clothes are Taobao, food is Meituan, , Ctrip , and Meituan, and Xing is Didi.
High-frequency services rely on subsidies, while low-frequency services rely on advertising.
Meituan subsidies 14.1 billion yuan a year, and Didi subsidies 200 million yuan a day when it was fighting. High-frequency services such as takeaway, bicycles, and taxi are all made through subsidies.
low-frequency service subsidies do not work. Taking second-hand cars as an example, users were given a subsidy of 3,000 yuan. It may be a few years after selling a car, and the brand awareness has been completely forgotten, so a company that subsidized in the used car industry is the first to fall.
All low-frequency ones, such as those who sell houses and cars, can see shell advertisements and melon seed advertisements. The low-frequency ones are supported by advertisements. There is a saying: Low frequency must be advertised for 10 consecutive years. These companies have not yet fought for 10 years, so it cannot be said that they are the top one now.
I have seen an example of an advertisement that has been published for 10 years and is not good enough: Can you still search the house website so far? In the past, it ranked in the top three in the Chinese Internet industry, with US$9 billion, and today it is US$200 million.
has been advertising for 10 years. With the loss of user demand, a generation of new people has replaced old people. The Yangtze River waves push the previous waves, knocking the previous waves to death on the beach. This is easy to happen at low frequency. Therefore, all low-frequency businesses that everyone does should be particularly concerned about the users' perception of the company and brand in their minds.
4. The supply side is high and the platform is high.
The development of the economy is looking at demand in the short term and supply in the long term, and supply determines demand. The supply of
platform mainly depends on two directions: whether
supply can be supplied in large quantities and is close to unlimited supply; whether
platform improves the efficiency of the supply side, allowing the supply side to make money. These two points of
must be valid, so that the trading platform can be easier to grow. The supply of
rooms and the supply of homestays are unlimited. The supply of cars is small in Beijing and Shanghai, and more in other cities. Everyone must see if your supply is really unlimited in the industry.
When starting a business, you must think about whether your supply is infinite or limited, and whether it can be generated quickly. Beauticians can be produced in one week, masseurs can be produced in three months, and hairdressers can be trained in three years. You must not think that the supply is infinite and then become a training company.
In addition, everyone should find the space provided appropriately.
Before 2004, everyone thought that the tourism (accommodation) market had no space, all of which were Ctrip and Qunar.But in fact, there are 12.5 million rooms in China (the number of rooms), close to 400,000 hotels, while , Ctrip, only covers more than 100,000.
What did Meituan do at that time? Increase supply.
is actually moving those small hotels to the Internet. Just increase supply and you will see your demand explode. Demand exploded, and more small hotels came up, which formed a cycle.
Can new matching opportunities be discovered between supply and demand? The new industrial Internet has opened up a new entrance for everyone.
In the future development, we must think about from the process of replacing humans by machines, such as housework robots, automatic massage chairs, etc., in order to truly solve the problem of supply. The supply of
is actually a lot now. For example, education is really good, and standardized supply is becoming more and more, because AI solves very complex supply problems.
In the (Internet) industry, everyone must look at the combination of industry and technology, not just technology.
Domestic Baidu, Tencent , Alibaba , Meituan, and foreign Facebook, Google, Microsoft , Amazon . They are all companies that combine industry and technology. Among the top 50 companies in the world, 14 are companies that combine technology and industry, and only 2 are companies that are pure IT technology. Of course, there are dozens of companies that are finance and traditional energy.
So, everyone must consider that the supply of actually determines the possibility of success in a company and determines the speed of running a company. In the Internet era, fast companies are fighting slow companies, which is the same truth.
5. Commercialization change, razor or refrigerator?
. I will tell you a very simple truth in terms of commercialization.
Do you sell Haier refrigerators or razors? Many specific operations of these two businesses are integrated, but their essence is different.
The refrigerator business must cover the user's acquisition costs in this transaction. The business formula is this revenue - customer acquisition cost. Don't expect that you can still rely on selling eggs to the refrigerator to get more income from a single customer in the future.
The business of razors is to focus on the long-term value of a customer. The first time the business does not pursue making money or even losing money, but relying on the long-term sales of blades, the profits are increased and larger.
Two days ago, a person told me that he sells used cars and has a series of services behind it, which can sell insurance and value-added. I told him NO. This is indeed the case in the short term. With the help of information imbalance, when selling used cars, they can make money by selling them loans and other resources.
But in the long run, society needs to divide the labor. Those companies that do loans will definitely enter this market and sell cheaper than you. So you will definitely separate the two processes of selling a car and selling a loan unless you can solve the credit problem. Just like Tencent and Alibaba, this can solve all problems. If you don't solve the credit problem, nothing will be solved.
Everyone must pay attention to two numbers. These two characters actually determine the way and method of making money:
1, LTV, how much money can you make from a user. 2. CAC, how much does it cost to develop a user?
I am a catering company. So far, countless catering companies have gone bankrupt, with an annual bankruptcy rate of 60% in Beijing and Shanghai. But the two companies survived:
1, with more than 1,000 per capita and higher LTVs. This is a business banquet. 2. Fast food is the fastest growing rate for less than 300 yuan. I think this is the reason for putting
in any company. Either you make enough money from one user, your service attitude and service quality are particularly good; or you will all achieve the same standardization as before, you make enough money from a single user, but the cost of developing a single user is particularly low.
Can you imagine it? McDonald's, , KFC, now has more than 4 million daily orders. Now there are more than 4,000 KFC stores and more than 2,700 McDonald's stores. When it has 10,000 stores, it is a platform.The largest fast food in China is Zhengxin Chicken Steak, with more than 18,000 stores. It is a platform itself, with millions of orders or even tens of millions of orders every day.
When we went to see the tea drinks, we only saw that we invested in Heytea, which was 20 billion yuan, which was very fast. But you haven't seen that China's largest tea drink Mixue Bingcheng has 5,000 stores, which is also a platform.
Any startup is what everyone thinks is doing in traditional industries, but to this day it is a link between the industry and the Internet. You must think about how you make money and how you spend money.
I believe that in the future, whether in the catering industry or the service industry, everyone here will definitely become an industry + technology platform company similar to the Internet platform.
I hope we can look forward together. China's economy will be better. China's catering industry is still 10%. All China's industries are developing rapidly. I believe that China will be the future of the world economy.
[Reference material]
LatePost. "Meituan Zhang Chuan: I have been a platform for 8 years, and I have summarized the 5 hurdles of the platform"
