"Big Mouth" Should Be Sold As Department Store &Nbsp; A Long Distance Run?

Beijing time before 22:30 on March 9th, listing new shares

Vow to be the "China Amazon" Dangdang, before the bottleneck of slow expansion of department stores, what is the first report content of its listing?

provocation

Li Guoqing's success after listing

In February 21st, Li Guoqing, the joint president of Dangdang and micro-blog red man, who always showed a big mouth image, said that Alibaba had been cheating, and more than 2000 victims had been compensated for 1 million 700 thousand dollars.

CEO will resign, and Li Guoqing challenged Alibaba's CEO successor, "the successor is Taobao CEO, fainting."

Then I had to ask Wei Zhe to drink the fake Lafite bought in Taobao.

The implication is to target Taobao's fake products.

In fact, the contradiction between Li Guoqing and Taobao has existed for a long time.

As early as in 2005, Alibaba's Taobao network had just been established for a long time. Li Guoqing once pointed out through the media that Taobao has led China's e-commerce to the wrong way, and there are problems such as true and false, and difficult to distinguish customers.

Nowadays Dangdang has been listed successfully in New York, and the competitor directly from the book pformation department is undoubtedly Taobao.

Li Guoqing obviously borrowed his "big mouth" nature to make a share for his Dangdang, even to the point of being criticized by netizens.

In an interview, Li Guoqing said frankly, although the outside world likes to share the shares between Dangdang and Jingdong mall and van customer, but in its view, Dangdang's competitors are actually only one: Taobao.

In the strategic position of Li Guoqing and Jingdong, 3C and retailers are only retailers of direct selling of clothing and private brand retailers.

Can only practise "mouth skin" Dangdang?

Dangdang's "enterprise character" before listing is quite different from the current high profile.

Dangdang, founded in November 1999, is actually one of the few Chinese entrepreneurs in e-commerce.

But in the 11 years of Dangdang operation and entrepreneurship, Li Guoqing and Yu Yu have only one thing to do: sell books.

Therefore, Ma Yun also can not suppress laughing and laughing: Li Guoqing and Yu Yu's "husband and wife shop" is a long-running "run long" long distance running between two stupid and reckless old cattle.

In 2009, Dangdang was first profitable after 10 years of operation, with a profit of 16 million 920 thousand yuan.

In the past 9 years, Dangdang lost $30 million, and its profit model and prospects have been puzzled by the industry.

While Dangdang listed on the day, the price of the gold couple exceeded $1 billion.

The success of the listing makes the old yellow cattle couple no longer diligent in "training booth"?

Maybe not.

According to reporter understanding, Dangdang listed, ambitious Li Guoqing will devote more energy to product upgrading and user experience.

Dangdang's products have covered all kinds of personal care, 3C digital, clothing, stationery, furniture, automotive supplies and so on, especially increasing the weight of department stores.

In terms of user experience, the "reading channel" has been launched to provide free reading before buying; and the functions of "community" and "forum" have accelerated the layout of Dangdang in the field of social electronic commerce, and increased the loyalty of users.

And after Jingdong mall and Taobao have increased their proportion of self built logistics, Dangdang has finally entered the camp of self built logistics.

The Dangdang mode is similar to the logistics strategic platform launched by Taobao.

For the platform based e-commerce enterprises, through the logistics platform, not only can help sellers solve the bottleneck of logistics distribution lag, but also can grasp the sales information of goods, dig out the huge value behind commodity information, and bring new profit growth point.

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Slow expansion of department stores restricts profitability

In January 26th, Li Guoqing posted his own understanding of the five major formats of retail business on micro-blog, which was a huge more than 10 micro-blog lineup. He said he had spent 3 years, spent tens of millions of consultants on fees, and invited professional agencies to learn from his experience.

Li Guoqing, who is "outspoken", has almost told the whole world about the plan of the department store industry.

However, the department store is a short board known to Dangdang.

Its "strength" is books.

As China's largest book retailer, Dangdang has a share of about 50% of China's online publications retail market.

However, for the fierce competition in the B2C e-business line-up, Dangdang obviously can not "eat books to the old".

Because it is limited to the single advantage of books, Dangdang's share price has been hard to see after its listing. It reflects Dangdang's profitability.

According to the prospectus, the profit margin of Dangdang was only 1/1000 in the first three quarters of 2010, and 8/1000 in 2009.

If the profitability of the book market is weakened or the cost rate is not well controlled, business profits may turn negative at any time.

The expansion of department stores has been very difficult for Dangdang.

In June 2001, Dangdang opened its first business expansion and opened online audio-visual shops.

In April 2004, Dangdang opened a fashion department store and began to expand its product line in a planned way.

In 2009, Dangdang launched the "platform B2C" plan, adopting the strategy of walking on two legs with self added joint venture to attract third party businesses to display and sell their products on Dangdang.

In the first three quarters of 2010, Dangdang's revenue grew by 55.6% over the same period last year, reaching 1 billion 570 million yuan, of which self operated department store business grew by 159.8% compared to the same period, while joint store business grew by 278.6% over the same period.

Although the growth rate is fast, the share of book sales still occupies a leading position, and the sales volume of department stores is low.

In this regard, Lv Bowang, President of the consultancy, thinks that the online bookstore is still the main business of Dangdang, facing the preoccupation of Amazon, Jingdong mall, Taobao mall and other competitors. If we can not speed up the process of department store, we will be in a passive and backward state.

Therefore, Dangdang's listing and financing of US $200 million is claimed to be a reserve for logistics and technology for the expansion of Dangdang department store.

Li Guoqing is clearly trying to make bigger and stronger department stores, so that customers who are used to buying books should pay more for cosmetics, mobile phones and milk powder.

From the data of Dangdang's turnover rate, this does not seem too difficult.

Customers who have been accumulating for 10 years must have two advantages if they can provide more department stores. Customers need not worry about double shipping costs when choosing different sellers, and do not need to worry about the quality of products and the replacement of goods. "Taobao"

In an interview, Yu Yu also pointed out that Dangdang's entry into department stores has three advantages: one is the accumulation of customer resources; the two is Dangdang brand, which has a certain degree of customer awareness; three is Dangdang's ready to do logistics and distribution system.

"From receipt, collection, sorting, quality inspection, packaging to distribution, Dangdang is ready-made and does not need to start from scratch."

But the key question is how to manage Dangdang to compete with similar offline and online stores, and to win more profits than books.

The reality in front of Li Guoqing is that interlacing is like mountain crossing, and it is facing many challenges to enter the department store industry.

In addition to the need to foster brand investment in the department store, Yu Yu said frankly that when the experienced buyers are in urgent need of compensation, they can know what material and how many yarns they contain.

Fortunately, Li Guoqing has introduced many department stores to Dangdang in recent two years.

In June 2009, Jiang Qiang, from WAL-MART, was vice president of department merchandise department after Jiang Qiang joined Dangdang.

At that time, another warehouse logistics leader was introduced from WAL-MART. Last year, COO Huang Ruo, who served as vice president of Taobao network, was mainly responsible for Dangdang's publications Sales Department, general merchandise department, promotion department and website sales department.

But Dangdang's logistics distribution is also facing challenges.

Lu Bo Wang points out that another difficulty for Dangdang to enter department stores is that cash flow management is more complex.

Dangdang used to get goods from publishers, and the return period was relatively fixed, mostly 3-4 months.

Department stores are different, one week, one month, and more time.

Yu Yu told the China Commercial Daily reporter that Dangdang department store has its own affiliate partners, that is, the suppliers will sell the goods on Dangdang online. After the sale, the suppliers will settle with Dangdang again.

In order to strengthen management, Dangdang strengthened the construction of IT system, especially the financial software.

To enter the department store, Dangdang can change the single profit pattern.

But Lv Bowang also believes that Dangdang still faces many competitors, including Amazon, Jingdong mall, red kids, etc., they have pformed from vertical B2C to department store B2C.

Taobao believes that Dangdang department store has great challenges, and that distribution, payment and management will not be able to keep up with it.

"Dangdang department store is divided into two kinds: one kind of joint store, one self operated store, and the alliance store actually adopts the platform mode of Taobao, which can disperse these risks.

But it can not compare with Taobao, Taobao is even bigger. "

Perhaps it is precisely because of the pformation department stores can not avoid the confrontation with Taobao, Li Guoqing will claim that, in any case, we should also sell fake Taobao.