Strategic Failure Of Traditional Enterprises To Enter E-Commerce

The trend of traditional enterprises entering e-commerce has become more and more obvious. After Guo Mei Su Ning decided to stir up tens of billions of household appliances. Online shopping market After that, BELLE footwear company also announced huge sums of money to invest in its e-commerce network. Before that, Yintai and so on. clothing Traditional enterprises such as footwear, daily chemicals and so on have touched "electricity".

In the prosperous XinDa CEO Liu Lei, the traditional brand has its indispensable core. Their understanding of product design and the assurance of the commercial supply chain are not available to Internet Co in the short run. Traditional business owners are really smart and have a long view. But the biggest mistake of traditional enterprises in making e-business is to think that the success of the past can be transplanted into the present and future success.

　 The strategic mistakes of traditional enterprises in the two stages of electricity supplier

Liu Lei believes that in the early days of PPG and the beginning stage of customers, there are a lot of traditional businesses that swarm into the mode of customers. Their strategic mistake lies in the fact that e-commerce is only regarded as Internet sales. They do not expect e-commerce to change the whole supply chain. The traditional selling behavior is the core oriented sales process produced by Mr. engineer and sold again. The Internet is a sales process guided by user needs, and the whole process is the opposite.

This is somewhat similar to the story of DELL. After years of development, DELL has achieved second of the world's PC manufacturers. Many companies want to take their place, but none of them can succeed. Because other PC vendors were wrong from the beginning. Because they are all product oriented, that is, to produce products first and then push them to the market. It is impossible to learn DELL's change in the supply chain, so it is impossible to make the order so fast, cost so low and capital turnover so fast that the product price is low. These manufacturers have made great mistakes in strategy.

When the traditional manufacturers think they have seen clearly how the Internet works, they know that the customer mode can not be fully COPY, and start a long-term plan. Liu Lei believes that at this stage, the strategic mistake of traditional enterprises is that although we recognize the importance of e-commerce, we can not understand that e-commerce needs not only a marketing team like fans. We also need excellent technology teams, warehousing teams like Jingdong, and quality operation teams. These excellent teams have been scramble for almost all the Internet companies, and some of the other talents have been pushed into the fast Internet environment for a very high price and a very poor price performance. Although they can get some high price providers in the near future, but the company has not changed because of the Internet, but the Department is independent to provide the corresponding resources, but the whole company did not complete the process transformation because of the Internet. There are good teams and money, but e-commerce is not always a success. Liu Lei believes that the reason is that the original process of the parent company is not divorced from the parent company. The traditional enterprises still want to take advantage of the traditional supply chain and do not change the process. This is their strategic mistake.

At the same time, traditional enterprises also have many problems in tactics, such as conflict on channels, recruiting people without considering long-term costs and so on. Liu Lei thinks that electronic commerce is a long distance running of 3000 meters. Now it has been very hot to run 500 meters. The road ahead is still very long. If there is no good strategy to keep up with it and do not calm down to think about these problems, "traditional enterprises will catch up with the swarm and will fall down in the future".

　 E-commerce marketing almost crazy website in overdraft future consumption

In addition to a large number of traditional enterprises in the field of e-commerce, some pure e-commerce enterprises have also stepped up their development efforts, especially on marketing.

Liu Lei recalls that in 05 years, an advertisement for an e-commerce enterprise can bring an order for books; 7-8 yuan can bring an order for 3C products; 11 yuan can bring an order for clothing bags and bags. Now these data have been turned into 120-150 yuan. The cost of marketing has been higher than 50% of the unit price. E-commerce business is to convert the purchase demand of future users into the cost of advertising. Liu Lei said that they gamble on the substantial increase in the income of online shoppers and the repeated purchases of users on their websites every year. At present, overheating in marketing is irrational, and this overheating is driven by VC, and media advertising prices follow suit. Liu Lei said that media prices rose by 20%-30% every year, because CPI and the Internet market are growing. But rising 100%-200% is not reasonable.

It can be seen that now heavily hit the market are two years to get VC investment in e-commerce enterprises. Liu Lei analyzed their aim of smashing the market in order to rob users. Capital pushes them behind them, and they need to rush them over as quickly as possible. Because this year or next year can not be spent to spend money, it shows that the original financing plan is wrong, so "they desperately hit marketing."

At the same time, there are many problems in the rear end of these e-commerce enterprises, such as poor user experience and poor logistics service. Liu Lei believes that these business enterprises do not pay attention to the construction of the backend, but are forced to do marketing first, then do the back end construction, or are doing it, but they can not catch up with the marketing speed of the front end.

Liu Lei pointed out that if the advertising price is so high, it will be regarded as a fool if it only hits the market with heavy gold. He believes that e-commerce is a long-distance race, smashing marketing equivalent to 100 meters sprint, the beginning of the stage is useless, only after 100 meters sprint ahead of others, the surface will be some of the scenery. Because the user is not "spend 120 yuan to buy over, in the website has been spending 200 yuan of goods". Although the accounts may be very good in the short term, long-term Book losses, sticky users, backstage support can not support orders growth, rely on manual transformation, user experience will decline, and users will run away.

　　 E-commerce can be more refined and vertically subdivided into opportunities.

In Liu Lei's words, the e-commerce market is now barbaric. "Because we have not done meticulous division of labor, but we are desperately expanding." In his view, this stage can not blame the business enterprise is not fine enough, but forced to helplessness. Although it is doing some work, it is still not elaborate enough. Although desperately doing CPS alliance, CPS platform, keyword buying, a lot of time is useless in marketing itself. "They have a lot of things to do, but they can't do it. Now the marketing of e-commerce is still too rough, we are desperately expanding the market. " For example, the user experience of Jingdong is not very good, and needs to be improved from page layout. "But they are developing too fast, and it is too late for them to change." Liu Lei admitted that other e-business enterprises also had various problems. They were pushed forward by money, such as recruiting people, building warehouses and so on regardless of cost.

China's Internet trend is from integrated to vertical, e-commerce as a form of the Internet, is also basically along this line of development. Liu Lei said that comprehensive e-commerce websites will form oligopoly, and a large number of vertical e-commerce will develop. Because their user experience is better and better suited to users of their type. They will divide up some vertical market segments. In Liu Lei's view, e-commerce in the vertical field is just beginning. It is not just the clothing field like fan. And the guest is not an object that can be copied successfully. Customers have mastered a lot of Internet resources, there are good operation team, good marketing team. There are good VC teams, including cut in time, which is relatively early.

Liu Lei pointed out that there are still many opportunities for vertical classes, and every industry has opportunities to develop. Liu Lei has different views on the bubble problem that the industry is worried about. He believes that there is no bubble in the enterprise, the bubble is the bubble of investors, and has nothing to do with the enterprise. For enterprises, is there only long-term business or short-term business? And if the investment sector is worth 10 yuan, but investing 20 yuan, this is the bubble. There should be one or two good companies in every vertical category. They are all present in the field of shoes and clothing. This has a lot to do with VC. Liu Lei believes that they should look for opportunities in other fields in the long run. In the future, social division of labor will become more sophisticated. Electric business enterprises do not need the whole process to do it themselves.

Real e-business is a problem that Internet companies only need to do well in information flow, and consider how to improve user experience and satisfaction without having to consider how to interface with banks and how to make delivery people good. The current situation is that China's e-commerce enterprises should not only make information flow, capital flow, but also do logistics. Because other companies can not do well, e-commerce enterprises can only do it themselves. So there are also Taobao, Jingdong, good Lok and other enterprises to build their own logistics. {page_break}

　　 The third party e-commerce outsourcing market is very large.

The XinDa team led by Liu Lei has been working in the Chinese e-commerce industry for more than 10 years, and has successfully deployed e-commerce business for famous brands such as NOKIA, Motorola, two percent costumes and Paci Doug. At present, the team size is more than 200.

Unlike other e-business outsourcing companies, Liu Lei does not own all the e-business projects. He has his own selection criteria, which focus on long-term development. At present, China's e-commerce outsourcing companies mainly do Taobao store sales outsourcing, but there are not many e-commerce companies that are outsourcing to official website sales. When a large number of traditional enterprises want to enter the field of e-commerce, more and more people are looking for Liu Lei.

In Liu Lei's view, not many companies can do the job of outsourcing the official website. Because first of all, we need to know about big companies and know their ideas in e-commerce. Second, we must have the technical strength in this area, which is necessary to reserve. Liu Lei reserves for 6 or 7 years. The annual cost of technical support is about 500 and 6 million. Small general outsourcing companies may not be able to do this technology reserve. The third is to have operational efficiency, the process needs to be reformed well, and every enterprise will come to realize all the process construction in the short term, and integrate all the customers into the outsourcing operation system. It is more difficult to serve these enterprises at lower cost and to maintain the same quality of service. Liu Lei said that XinDa has been doing three years in reforming its internal structure.

Liu Lei's team rose from technology, and the technology products before it still occupy 30% of the market share in the market. From technology outsourcing to operation outsourcing, it has been a step by step until today. Although many VC have come to talk about investment, Liu Lei said he still did not want to know whether to accept these investments. On the one hand, on the one hand, because XinDa's business is profitable, on the one hand, on the other hand, the third party e-commerce outsourcing enterprises will be more suitable when Taobao and Jingdong do enough. When traditional enterprises recognize the power of e-commerce and they can not do it themselves, it is more appropriate to enter this time. It is not very meaningful to accept these investments now. XinDa has always been a free capital operator.

Compared with foreign e-commerce enterprises, Liu Lei believes that more efficiency is being done abroad, how to reduce costs and how to improve efficiency. In the entire electronic commerce link, information flow, capital flow and logistics. In terms of information flow, Liu Lei thought they were too weak to be far from China.

Europe and the United States and other developed markets, all IT systems have been well arranged, and there is no need to worry about many things. So their front end marketing and back end functional modules are not. The marketing method is also very simple, either discount or promotion, not like Juhuasuan, spike, red envelopes, cash back and so on. They are even simple enough to do a product display and a price reduction promotion is over.

The degree of trust for users is also very simple. For online shopping users in Europe and America, as long as the experience is good enough, online shopping habits will be directly purchased. Unlike China, it has to do a lot of company introduction and product introduction, proving that it is genuine licensed products. Liu Lei believes that most of China's energy is focused on educating users to buy genuine goods, while European and American electricity providers are doing very little at the back end, including warehousing and logistics. How to arrange, walk, how to grasp the robot, how to put the goods on the conveyor belt, and how to pack the boxes? China has low cost because of its low labor cost. In terms of logistics, the gap between Chinese e-commerce enterprises is very large.

Similarly, in terms of capital flow, European and American business enterprises are relatively developed. The whole shopping process can be completed in 5 steps, just filling in the credit card information. Generally speaking, China has to take fourteen steps, that is, the key 14 buttons can complete the purchase. It requires tedious verification and repeated confirmation of orders.

These gaps are also opportunities for Liu Lei's third party e-commerce outsourcing companies such as XinDa.