Research object: Chairman Zhang, Director General Huang
Core points: Internet transformation, B2B2C business platform, peripheral discounts
Main text:
This time, I will mainly introduce the development of Anjubao's Internet business (B2B2C business introduction). It has been over a year since Anjubao's Internet transformation. The B2B2C business was planned in May of last year, and the B2B2C business is a key part of the transformation of the Housing Office to the mobile Internet.
I. Platform composition
Big B is a manufacturer, and Xiao B is a store. Currently, the B2B market is still quite promising. It started in May of last year. The B2B2C business platform consists of two parts: the BPB platform and the “peripheral discount” app. The BPB platform (peripheral preferential purchasing and wholesale platform) between Big B and Xiao B is actually an online and offline B2B guaranteed trading platform (similar to Alipay and Tmall). Achieve “decentralization” of sales channels to help suppliers drastically reduce channel construction cycles and channel costs at the source, speed up cash flow, and solve the problem of delivery difficulties. Address the interests of both product suppliers and end retailers at the source. Current progress: The development of the PC side of the platform has been completed, the mobile version was launched at the end of January, and investment promotion for big B-side merchants has now started.
The “Peripheral Deals” app (released in May 2015) is a new O2O shopping guide platform integrating shopping, sharing, communication, and services (no capital transactions, just drainage). Stores can post discount information on their own, and the company strives to make it the app with the most discount information in China. The company charges 1 yuan/km (with the store as the radius of radiation at the center of the circle) per day for stores to post preferential information. Light value products or services (bakeries, laundries, etc.) often require a lower radiation radius. Around one kilometer, stores with high value products or services (home appliances) require a larger radiation radius. “Surrounding discounts” are centered around the 3 km service of the community, providing users with convenient life, real discount information, and bringing real convenience to community users. C-side fans use “peripheral discounts” to find discount information, and Xiao B uses it to post discount information to draw traffic to the store. Positive feedback is formed between stores and users, which can also attract Big B vendors to participate in the platform.
When “Peripheral Discounts” was first distributed in May of last year, it only supported the publication of discount information, and later the function of issuing coupons was added. The publication of coupons on “peripheral discount” platforms is not the same as popular reviews, Meituan, etc. First, “peripheral discounts” are distributed free of charge. Furthermore, there is no deposition of merchant funds. Customers collect vouchers and then go to stores to spend with vouchers, so they are somewhat attractive to stores. For users, payment time is delayed, and free options that can be cancelled before actual consumption is obtained. Current progress: 198,000 stores have been registered in 35 cities across the country. The company's B2B2C business platform is somewhat innovative compared to other companies on the market. Compared with Huicong Wholesale Network, Yifu Baiying, etc., the company has more B2C, integrated services, and established an ecosystem.
II. Promotion Plan
1. Promotion of stores (b) and fans (C)
A. The company's promotion has covered 35 major cities (major provincial capitals)
a. Introduce a certain number of local discount information and coupons. For example, Guangzhou plans to enter more than 10,000 offers and discount information (Meituan and Dazhong Dianping only have more than 7,000 in Guangzhou)
b. Distribute promotional materials and eco-friendly plastic bags with surrounding discounts to local stores. For example, Guangzhou will distribute 3 million plastic bags to no less than 100,000 stores, and distribute over 100 million plastic bags nationwide (plastic bags will be given away free of charge; the cost of small plastic bags is 8 points, large plastic bags cost between 1 dollar 2 and 1 mao 3. As the business is gradually promoted, “information related to surrounding discounts” will be printed on both sides of the plastic bag, and the other side will be sold as advertising resources in exchange for revenue balance plastic bag production costs). Plastic bags will be taken home by users, with a high exposure rate.
c. Regularly send plastic bags and promotional materials free of charge to merchants (small b) that register to download “Peripheral Deals” and send discount information and coupons to stimulate shops' enthusiasm. It is estimated that Guangzhou will distribute 6-8 million bottles within six months. Based on this scale, every household in Guangzhou will own at least one plastic bag.
d. For users who download “Peripheral Deals” (end C), get a “portable bodyguard” worth 38 yuan per hour (“Carry-On Bodyguard” is a unique personal safety protection mobile application that comes with the peripheral discount app. It provides 7*24 hours of emergency help for personal accidents, and provides users with paid help services through voice deterrence, audio and video surveillance, shaking alarms, etc.) to attract and increase user stickiness (the national plan is to send out 30 million copies). Current progress: The above promotion plans in 35 cities will be completed within 3-5 months.
B. Thousand Cities Promotion Plan
a. Initiate a partnership system based on counties and districts. It is planned to recruit no less than 2,000 county and district partners (to be completed by May) and spread quickly to the whole country; 1-3% of the wholesale turnover will be used as a commission and a reward for receiving fans: ¥3/person. b. Recruiting local security engineers to promote partners from various cities. The company will use store alarms, network camera sales agents, and cloud parking business agents in some regions as terms of cooperation.
c. The steps 1 to 4 are the same as in 35 major cities: to users who download nearby promotions (C side), send a portable bodyguard app worth 38 yuan per hour to attract and retain users (the national plan is to send out a total of 30 million copies).
Current progress: The recruitment of partners has now started and will be completed by the end of May 2016, and the ground promotion work will be completed by the end of July to complete the promotion of Qiancheng.
2. Investment from manufacturers (Big B)
Stores registered with “peripheral discounts” and the sending of free discount information and coupons as sales points are used as sales points to attract manufacturers to enter the platform. Means: plastic bag advertisements, advertising of the app itself, media promotion, etc. Preferential measures: All big B-side manufacturers and large wholesalers are free of charge for the first six months. Currently, all platforms entering the market basically charge a service fee. JD 2W, and many other platforms are 4-5K/year. Tmall not only requires a service fee, but also an 8-10W deposit. After half a year, membership prices will be determined based on the development of the platform and merchants.
III. Project development space and benefits
Offline transactions currently account for about 80% of the domestic market, about 10 trillion dollars of space. The source of project revenue is:
1. Membership fees for manufacturers entering the platform
2. Revenue from advertising expenses: a. Peripheral discount ads b. Targeted and accurate promotion of store advertisements by manufacturers
3. Transaction intermediary fees, technical support fees, plan 3%-8% (maximum). This will be split between the partners, and after deducting the handling fees for the payment channel, it will be split by half with the partners. There will also be certain adjustments as later operations develop gradually.
Q&A:
Q1: Has the conversion rate of plastic bag promotion methods been piloted? Which is cheaper or faster than traditional buying traffic?
Before using this method, various forms were compared. The exposure rate of plastic bags was high, the cost was low, the comprehensive conversion rate and cost were very cost-effective. The partnership system can help new businesses to be promoted quickly. After signing a contract, partners can complete the start-up work within a month, and 2,000 counties and districts will complete all the work before July.
Q2: What kind of company is it positioned to become? Similar to popular reviews and Meituan?
Meituan and Dazhong Dianping mainly focus on food, not a store, no B2B, and no platform.
Q3: What channels are used for platform payments?
Alipay and UnionPay will wait until they are done and consider accepting third party licenses.
Q4: There are many offline partners, are there any management control considerations?
Instead, this is Anjubao's advantage, because Anjubao's traditional business is building video intercom and has established more than 120 direct branches and offices in China. Originally, Anjubao Project had more than 3,000 customers and rich management experience. Managing more than 2,000 partners was simpler than managing more than 2,000 contractors.
Q5: The company has been trying to transform the Internet. Previously, through cloud intercom, which method will focus on in the future?
The company's transformation to the Internet is the most important decision and strategy. Anjubao's transformation is a process. At the beginning, it was announced that the transformation of the Internet wanted to use Anjubao's community security as an entry point (cloud video intercom, Anju doorman). When initially promoting cloud video intercom and residential doorguards, it was discovered that domestic closed neighborhoods were less than 20%, and strictly closed neighborhoods were around 10%, and only strictly closed neighborhoods were in demand; secondly, user downloads were highly correlated with property promotion efforts, and promotion subsidies required by some properties were higher. The Internet is now being used through “peripheral discounts” because actual operation has revealed that the current method is more economical and more promising.
Q6: What is the break-even point of promotion?
The company's net profit forecast for 2015 is 30-50 million, Internet spending in 2015 is about 60 million, and the company's actual profit is about 100 million. There has been no significant increase in the overall promotion costs of developing an Internet business; partners mainly earn income through commissions. According to preliminary estimates, the platform can balance if it has a trading volume of 2 billion, and if it has a transaction volume of 10 billion, there is no problem with revenue exceeding 100 million.
Q7: Parking business progress, future plans?
Parking lots are a pain point. The problem is that in large central cities, the pace of parking is currently slowing down. Because of heavy assets, more than 200 parking lots have already been signed in Guangzhou, and they want to promote them throughout the country after being piloted in Guangzhou. The parking lot is currently initially divided into three areas, which are carried out using different business models. The first region is a central city with a high pain point. There is a big problem with parking difficulties. Currently, in 30-40 such cities in China, we use “cloud parking” to earn money by operating follow-up services such as parking lots; the second area is that parking difficulties are not particularly prominent, but there are branches or offices in the region, delivery in a small number of central areas, and most of the others are sold; the third area is places other than branches or offices (120 major cities), where parking difficulties are not a problem; finding agents to sell.
Q8: Plans for outbound mergers and acquisitions?
Complementarity or connection with business has never been rejected, but the requirements are high.