"God" Is Too Harsh To Kill Each Other.

CEO, Bi Sheng, once told the media: "Baidu's position in the same place last year, 35 months in a year, arrived 70 months in the beginning of this year, now even to 800 months in a month."

The backer who can produce such a big increase is known as the electricity supplier supporting the banner of domestic Internet development. But what kind of days do the business people of the top halo actually live? Recently, as one of the largest business platforms in China, Dangdang and Mcglaughlin, the first Chinese electricity supplier listed in the US, have issued an alarming annual loss report. Among them, Dangdang lost $36 million 300 thousand for the whole year, and Mcglaughlin also lost 33 million 300 thousand dollars a year.

　　 "God" is too harsh.

For most netizens, Electronic Commerce Has been integrated into every aspect of daily life, for many consumers who are keen on online shopping, the electricity supplier has even replaced the traditional entity shop as its main consumption mode. However, the business model that has been used and dependent on so many netizens has been living on the day of "making money without making money", which is not necessarily a good thing for every netizen. For the bitter days of electricity providers, consumers are also "duty bound".

　　 Le Tao CEO Bi Sheng once revealed that when users bought shoes in Le Tao to go back for a month in the warranty period, customers said they should not return to them when they were dressed unfit. In addition, some users deliberately damage the goods and return the merchandise before the expiration date. "There are 10 million of these shoes in my warehouse, and the loss is 20 million, which is not very bad. And underwear is also worn back by underwear." Bi Sheng said these are the ways of consumers to "kill the electricity supplier", and there are many ways.

For the future of the electricity supplier industry, Zeng believes that only the development of the market supply and demand relationship that consumers can buy affordable and secure at the same time, the electricity supplier can also get a reasonable profit can the whole industry develop healthfully and continuously. "For the time being, the electricity supplier will burn the money of the venture to subsidize the cost of spending on consumers, but in the long run, when the electricity supplier has no money to burn, the decline of the electricity supplier's service or even the closure will be a great blow to the entire Chinese Internet industry, and its impact on consumers who have already turned e-commerce into" necessities "is immeasurable.

Jingdong mall CEO Liu Qiangdong, who was interviewed by the media, published his own view on the predicament of the electricity supplier industry: "now the so-called winter is actually the winter of capital, not the winter of business. The whole industry has come to the stage of shuffling, and every enterprise can only successfully train its internal strength in order to get through the capital market in the winter.

　　 "Killing each other"

Coincidentally, Dangdang and Mcglaughlin are very close to the amount of losses, but the two business enterprises with different sizes and modes have different reasons for their losses. According to Dangdang's earnings report, Dangdang's total revenue in the fourth quarter of 2011 was 1 billion 232 million yuan (US $196 million), an increase of 73% over the same period last year, and a net loss of 130 million yuan (20 million 600 thousand US dollars) in the fourth quarter, a net profit of 14 million 800 thousand US dollars in the same period last year. In 2011, the total revenue of Dangdang net in 2011 was RMB 3 billion 600 million yuan (US $575 million), an increase of 59% over the previous year, a net loss of 229 million yuan (US $36 million 300 thousand), and a net profit of 30 million 800 thousand US dollars in the same period last year. It can be seen that Dangdang's loss in the fourth quarter of 2011 has accounted for 56% of the total loss in 2011. In the fourth quarter of 2011, the gross profit margin of Dangdang was 10.5%, while that of the three quarter was 13.8%, compared with 22.4% in the same period last year. This shows that the fourth quarter "seriously dragged" Dangdang's annual performance.

As for Mcglaughlin, the situation is even worse. Losses have become the "main theme" throughout 2011. In the fourth quarter of last year, net revenue of Mcglaughlin fell 9.7%, to 58 million US dollars. Net loss was $11 million 500 thousand, and total revenue in 2011 was 217 million 900 thousand US dollars, down 4.2% from 227 million 500 thousand in the previous year, and in 2011 the net loss of Mcglaughlin reached 33 million 300 thousand US dollars. In 2010, Mcglaughlin still got a net profit of 4 million 400 thousand dollars.

"The loss of the electricity supplier is largely due to" killing each other ". In an interview with Nanfang Daily, Zeng fan, a senior Internet personage, said that the vicious competition between the electricity suppliers was the reason why the end of the business could only be "making money without making money".

Dangdang CFO Yang Jiahong said in an interview with the media that the gross profit margin of Dangdang in the fourth quarter of last year was mainly affected by changes in product mix. November is the annual activity period of Dangdang, so many promotional coupons launched have affected the profit margin of Dangdang. But Yang Jiahong admits, "the price competition in the fourth quarter is also fierce."

Jingdong mall CEO Liu Qiangdong told reporters in the Nanfang Daily interview about the relationship with other competitors. Liu Qiangdong regrets that he used to be friends with his competitors before, but in the list of friends, there is no Dangdang CEO Li Guoqing. "In the 3C area, Jingdong, new egg and XXX were very competitive, but I and their every boss were privately good friends. We once fought the price war, but it did not affect our respect for our opponents in private. We also have competition with Dangdang, but we will not attack Li Guoqing in private. "

When commenting on the reasons for the loss, Dangdang CEO Li Guoqing said, " Dangdang The loss is in service and price war, it is worth it! But I wonder if shareholders will agree with Li Guoqing's "value" view.

In addition to Jingdong mall and Dangdang this pair of "enemy", Mcglaughlin is facing more from all guests, dream bazaar and even vip.com and many other competitors. In the battle of the electricity supplier, no one dared say that the days were better than the rivals.

Zeng fan believes that Dangdang and Mcglaughlin have different reasons for losing money, but they are enough to represent the current operation of the overall electricity supplier. "Now, which electricity supplier dare to stand out to say that the profit situation will be better than Dangdang or Mcglaughlin? In 2011, for most consumers, the popularity of e-commerce can be said to be quite high, consumption habits have gradually formed, but for the electricity supplier, it is also constantly in the middle of losses, it can prove that the current electricity supplier's industry environment is in urgent need of change." Jingdong mall, which has a leading position in the Chinese electricity supplier industry, does not deny that it is still in a state of loss. Jingdong mall CEO Liu Qiangdong told reporters in the Nanfang Daily that Jingdong mall is likely to make a profit in a month in the second half of 2012, and that it will not consider listing in 2013, because "the topic of profit and listing has never been talked about between senior executives and Jingdong".