After re-encouraging Cheng Yingying, the tenth-level drummer who had given up, Gu Yun returned to the Paradise Building and walked into Huang Zheng's office.
Huang Zheng has always been a steady manager. He has a strong academic background, precise operations, profound thinking, strong action, and a particularly calm and low-key personality. He is a young man who is called a stone Buddha.
He brewed a pot of Mingqian Longjing early and waited for Gu Yun's arrival.
When Pinyuan entered the mainstream Internet crowd's horizons, it was already a small giant with a user base of nearly 300 million, less than three years after its establishment.
As we all know, Pinyuan is an e-commerce platform that allows users to initiate group buying and purchase goods at lower prices, covering all categories.
"Judging from the first three quarters of this year, our Pinyuan GMV (gross website transaction volume) has exceeded Vipshop's 42.9 billion yuan, becoming the third largest company in the country in terms of e-commerce sales."
Huang Zheng did not ask Gu Yun the questions on the phone, but instead talked about the current situation of Pinyuan.
In fact, Pinyuan Garden, which Gu Yun did not have much involvement in, is one of the fastest growing companies under the Paradise Group.
Like Kuaishou and DouLe, which suddenly became popular back then, Pinyuan has followed the trend of hundreds of millions of new users.
"I roughly know what you want to ask. Looking at it now, we have developed silently for such a long time, and we have indeed developed the basic conditions for independence."
Next, Huang Zheng clicked on a picture on the projector.
According to Jiguang Big Data, as of November 2013, in third-tier and above cities and towns, which account for about 55% of Chinese Internet users, the penetration rate of Pinyuan in third- and fourth-tier cities (21.38%, 35.34%) even exceeds that of mobile Taobao (20.31%
,31.50%).
"Low-price group-buying" is what consumers understand about Pinyuan. It is also a methodology verified by Pinyuan. It can spread quickly and accumulate hundreds of millions of users in a short period of time.
The outside world, including traffic provider Penguin, defines it as a social e-commerce and sales platform.
But in the eyes of Huang Zheng, the founder of Pinleyuan, who watched Pinleyuan grow up, these interpretations are not accurate.
"I think the public's attention to Pinyuan is half a beat behind its development. In fact, we can still survive even without WeChat."
When we first started our business, vertical e-commerce was on the rise and the platform was declining, but Pinyuan was shifting from vertical self-operation to a comprehensive platform.
When people talk about the "second half of e-commerce" and believe that the e-commerce field has been completely divided and traffic can no longer grow exponentially, Pinyuan has quietly accumulated 100 million users.
When Pinleyuan officially emerged from the industry and was regarded by the industry as the leader in social e-commerce, Pinleyuan began to try to leave WeChat.
As early as the beginning of 2013, Gu Yun had discussed with Huang Zheng what to do once the traffic entrance of WeChat was no longer open?
Even in the context at that time, the big boss probably just said it casually, but Huang Zheng became alert very early and started to make arrangements.
Saying goodbye to the turbulence of large-scale mergers and acquisitions and large-scale competition, the Internet order has entered a long period of stability, and the rapid growth of companies such as Doule, Kuaishou, and Pinyuan has brought the possibility of breaking through the existing order.
However, a deeper industrial chain, more powerful enemies and a shorter time window have made Pinyuan's situation more complicated.
It faces controversies over fakes and induced sharing, internal conflicts over making good products and maintaining growth, a complicated relationship with Penguin, and short-term and long-term competition with Alibaba.
Multi-dimensional wars are intertwined. The pitfalls that Alibaba and JD.com have gone through before, Pinyinyuan must go through more or less.
"I just heard Yingying briefly talk about the case. I think the key point is not how to operate WeChat, but our own strength."
Huang Zheng identified the problem accurately, and even compiled the monthly report into a ppt on a whim on Gu Yun's way.
He believes that the competition between Pinyuan and Taobao will be an important aspect of e-commerce in the future.
This may be more interesting than the duel between Baidu Information Flow and other search businesses - because it is a battle in which the giants turn around and the latecomers break through.
Both parties have their own advantages and disadvantages: Taobao occupies two major scenarios: search and information flow recommendation, and can reduce dimensionality.
Pinyuan cannot replace Taobao’s dominant position in search scenarios, but it is very flexible in internal entrepreneurship such as reverse low-price customization.
"When Steve Jobs came back from Apple, he filmed an advertisement in which he said that you can praise him, you can insult him, you can say anything about him, but one thing you can't do is you can't ignore him."
Huang Zheng said with a smile.
“Everyone thinks that we don’t have anything to worry about without WeChat. In fact, group shopping and low prices are not the core of our current situation.”
Group buying and low prices are actually tools and means of competition that have existed in the e-commerce field for a long time.
As early as a few years ago, Taobao's group-buying product "Juhuasuan" sparked nationwide group-buying, achieving an annual GMV of 10 billion yuan in an era when infrastructure was still imperfect.
Many years later, group buying once again entered consumers’ horizons on a large scale through the link from “Yuan Lottery”.
One of the inventions that everyone feels is time-honored is that you just need to press the button to pay, and you don’t even need to fill in your account number, you can complete the group buying and become one of the hundreds of millions of group buying netizens.
“Low-price group-buying” is consumers’ understanding of group-buying.
However, Huang Zheng saw that from Mogujie, Beibei, to start-up companies, large and small players have gone to WeChat to make gold, competing with Pinyuan in terms of price, category, etc., but it is difficult to replicate the speed and scale of its rise.
This was Huang Zheng's confidence to straighten his back and tell Gu Yun that at this stage Pinyuan would not die even if he lost WeChat.
The reasons behind this are: firstly, they did not see the phased role of low-priced group buying; secondly, they ignored Pinleyuan’s product potential; thirdly, they underestimated the possibility of Pinleyuan’s transformation and self-leapfrog.
Just like Doule and Kuaishou cannot be recreated in the short video field, the time window for copying Pinyuan has passed.
"The growth of Pinyuan is the inevitable result of the third wave of demographic dividend of the mobile Internet."
When it comes to this, Huang Zheng is extremely confident.
The third wave of people mainly come from the third, fourth and fifth tier urban population, with a population of 5.6 billion. The main reason for their rise is WeChat and the mobile payment brought by red envelopes.
Moreover, this wave of users are more from families. Compared with the previous two waves of users, they are responsible for the next trend of China's mainstream consumption.
Penguin believes that without WeChat, many people will abandon Pinyuan and switch to other e-commerce platforms.
But for people in the third, fourth and fifth tiers, even if WeChat completely blocks Pinleyuan, they will not be able to find the next e-commerce platform to replace Pinleyuan for a while.
Pinyuan has built its own moat in less than three years.
This may be the reason why Taobao failed to seize the opportunity - the lack of exclusive social tools and the threshold for using Alipay.
In addition, on the supply side, Taobao's de-low-endization process accelerated during the same period, and Taobao began to reduce its traffic support for low-quality, low-price mass products.
"Mr. Gu, there are 8 million merchants on Taobao, and less than half of them can obtain valid orders. Looking at it now, a large amount of social excess production capacity caused by the trend of export to domestic sales urgently needs to be released. Even if Pinyuan loses WeChat, it will still become a worthwhile business in the eyes of merchants.
One of the platforms to try.”
"In the new environment, consumers need a new consumption scenario."
Huang Zheng added another cup of tea.
Gu Yun nodded. Since starting his own business, there have been frequent discussions about the future between the two of them.
Initially, we used WeChat scenes to create group groups - this is also the reason why Pinyuan Paradise has achieved dissemination and fission in a short period of time, and the user acquisition cost is very low.
After that, Pinleyuan quickly entered its first rising period. A full year after its establishment, its monthly turnover quickly exceeded the 10 million yuan threshold, and its paying users exceeded 20 million.
However, after entering 2013, the periodic bonus of group building has passed, and it is difficult to achieve similar explosive effects again.
"The reason why Penguin has the confidence to use WeChat to threaten us is because the outside world studies Pingu Paradise as a group-buying tool, copying low prices and copying group-buying."
"It seems they are destined to be disappointed."
The definition from the outside world is not accurate, and it ignores Pinleyuan as a product, and the founding duo as rebirthers and top entrepreneurs understand human nature very well.
Pinleyuan's product mission is "more benefits, more fun", which exactly corresponds to human beings' material and spiritual needs.
This is the second stage of putting aside WeChat traffic factors and the reason why Pinyuan Park can maintain a faster growth rate.
It is also a low-priced group-buying product, and Pinyuan Paradise makes users feel that “you will earn money if you buy it”.
This stems from Pinleyuan’s extremely subtle definition of cost-effectiveness.
For example, the first product launched by Pinyuan was a 1-yuan flash sale on Lay’s potato chips.
Although the price is so low, it has received complaints from consumers.
"Although it only costs one dollar, if the potato chips are sent and broken and cannot be eaten, the consumer will feel that he did not take advantage and say that you are a liar; but as long as he can still eat half of them, he will feel that it is worth it."
Huang Zheng talked to Gu Yun about his mother's spending on Pinyuan.
I bought 9 mangoes for 10 yuan, and 2 of them were bad.
The aunt came to complain to Huang Zheng, but she still chose Pinyuan when she placed the order.
"You can buy 7 good mangoes for 10 yuan, so it's not a loss."
Internally, this product operating principle is interpreted as “making users feel like they are taking advantage.”
And this is the core measure taken by Gu Yun and Huang Zheng to fight against the monopoly of WeChat traffic platform and try to find their own new path.
It can be seen that Pinyuan has conducted a large number of operational activities such as bonus packages, lottery draws, price bargaining, etc. to continuously stimulate users' various consumption desires - impulsive consumption, venting consumption, rational consumption, comparison consumption, etc., and finally achieve purchase.
"We now give users the feeling that they will lose money if they don't click in or buy."
Therefore, even in the face of differentiated competition and the crisis of a cliff-like decline in platform traffic, Pinyuan Park still has the ability to attract consumers to keep coming back.
"Last time you said you had to optimize for three rounds, just waiting for this moment."
Huang Zheng smiled and clicked on the next picture, which was a new project he worked on alone, optimizing the Pinyuan App.
The picture shows that Pinyuan has entered a new stage of development and has an independent position outside the WeChat ecosystem.
An app with an average daily activity of tens of millions per month, and about 60% of the users installed and retained in the first week - Pinyuan.
"Ever since I focused on the app, I discovered that social e-commerce does not exist at all. It is a false concept."
Huang Zheng smiled.
The core of social grouping is to build "people are divided into groups". It should be regarded as a window to understand users, rather than being regarded as a click or a means of growth. This is the core reason why Pinyuan came out in the early days.
When the user is fully understood, the platform will push the most suitable products to the user. App is the platform where users can achieve this goal, so WeChat is not the only and ultimate scenario.
This is rarely noticed by the outside world.
Because Penguin has never opened an entrance to the paradise.
Since its birth on WeChat, the relationship between Pinyuan and WeChat has been more like a “cat-and-mouse game.”
Pinyuan requires WeChat. WeChat is a window that can reach users and understand them.
WeChat also needs Pinyuan. In the early days of social e-commerce, Pinyuan was used as an official example to demonstrate the potential of social e-commerce and attracted a large number of people to join the WeChat ecosystem.
But when the park developed to a certain scale, the balance changed subtly.
Over-reliance on the WeChat social scene for transactions will cause Pinyuan to lose some of its dominance.
Before the lawsuit, Pinyuan Park was already using operating methods such as "app reviews and red envelopes" to encourage people to stay more on the app, without even having to share it, and just join the group directly in the app.
"You see, according to data, the penetration rate of our Pinyuan App has increased from an average annual average of about 1% to 19.37% in November."
This chapter is not over yet, please click on the next page to continue reading! When Gu Yun saw this number, he finally felt relieved.
This powerful number is enough for Pinyuan to break away from WeChat and enter a larger field and more platform-based competition.
The ability to analyze users accumulated in the past can also create new scenarios in new competitive fields - personalized recommendations.
From a thousand people to ten faces, from a hundred faces to a thousand faces, this is his long-term strategic plan, and it is also the path that Pinyuan must take.
Growing on WeChat and breaking away from WeChat are development needs and future needs, and it is also what the Paradise Group hopes to see.
"Without WeChat, the next step to expand new users will be in this position. It is very difficult. It is difficult to serve first- and second-tier users."
Gu Yun clicked on the map on the projector.
Data shows that the penetration rate of Pinyuan in third- and fourth-tier cities is very close to the penetration rate of Internet users.
If it needs to continue to maintain user growth after losing WeChat, Pinyuan will need to go to first- and second-tier cities to find users. Obviously this will be a war of attrition.
At first, consumers may choose Pinyuan because of the novelty of "low price, no loss", but for first- and second-tier users, as consumption upgrades and they become disappointed with some products, users will abandon it.
"You don't have to worry about this. The best way to solve the problem of platform products right now is through operational management and supply chain upgrades."
Huang Zheng has already thought about this aspect.
For a long time, Taobao has faced accusations of fake and inferior products.
The same is true for Pinleyuan. One of the reasons is that Pinleyuan uses commodities as its operating unit, which magnifies the consequences of commodity problems.
Unlike Taobao, Pinleyuan does not have the concept of stores and shopping carts. Products are operated independently, and each product must be reviewed and priced by the operating assistant.
Products that can become popular items are generally high-frequency, urgently needed and low-priced.
Low prices may cause merchants to lower quality standards.
At the same time, user demand is extremely difficult to predict. If a single product suddenly becomes a hit, the shipment volume will be huge in a short period of time, and most C-end merchants do not have sufficient stock due to financial problems.
The only response strategy is to deliver the goods by mistake, ask consumers to refund, buy them on the market, or simply remove them from the shelves, because Pinyuan has very severe penalties for merchants who do not deliver goods within 48 hours.
Once product quality problems arise, users give up on returns considering the cost of returns and exchanges, which will seriously affect the user experience.
At the same time, this also forcibly compresses the life cycle of single products, putting greater pressure on non-factory merchants.
Therefore, using more technology to replace operations and more standardized management must be the focus of Pinyuan’s next adjustment after losing WeChat.
The second is supply chain upgrade.
"Transforming the supply chain is the focus of development after Double Eleven. Brands are iterating rapidly. We just need to ensure that when there is a new brand, users on Pinyuan can see it."
Huang Zheng said that the next step is to support multiple brands and create exclusive reputation.
At present, competing for users is not only to compete for the incremental market, but also to compete for users’ limited attention. Improving product quality and supply chain is the best way to persuade users to stay.
Pinyuan Park relied on WeChat in its early days and leveraged huge traffic and user resources through group buying and other forms.
However, with the deepening of operations, especially to improve the "shopping" attributes of the park and increase user stickiness, it is inevitable that the marginal effect of customer acquisition within the WeChat system will decrease.
This is also the main reason why it spends heavily on brands: through brand promotion, it can obtain natural increments and drive users' trust in the platform.
"In the middle of the night, I really didn't come here in vain, Lao Huang."
"I didn't expect that I just pointed in a direction and you implemented it so fully."
After a long conversation with Huang Zheng, Gu Yun gained the confidence to flip the table with Penguin.
