Liu Qiangdong: 2 Important Strategies In The Competition Of Electronic Business

6.18 and double 11, two times a year

It is the battleground where the electricity giants are fighting fiercely.

In recent years, with the sudden emergence of the Jingdong, 6.18 has evolved from Jingdong's own anniversary day to the national shopping festival, with a direct force of double 11.

In the competition, Jingdong has always adhered to an important strategy -- protecting the second and second generation.

6.18 and double 11, the two electricity supplier Shopping Festival every year is the battleground where the electricity giants are fighting fiercely.

In recent years,

The sudden emergence of a new force has changed from 6.18 days of Jingdong's own celebrant day to the national shopping festival, with a direct force of double 11.

6.18 and double 11, the two electricity supplier Shopping Festival every year is the battleground where the electricity giants are fighting fiercely.

In recent years, as Jingdong launched this year's 6.18 launch ceremony, Liu Qiangdong said: "today, whether online or offline, Jingdong has become the largest retail enterprise in the field of 3C.

In the next three years, the sales volume of Jingdong appliances will surpass that of Suning Gome.

As we all know, Jingdong started in 3C, has gone through numerous business wars and brutal competition and has become the industry leader. The share of Jingdong in home appliances online shopping market is as high as 60.2%, and it is also absolutely leading, and the market share is expanding.

A few days ago, Liu Qiangdong first disclosed in his new book "Liu Qiangdong's self statement: my business model". Jingdong has always adhered to a very important strategy in the competition -- protecting the second and third generation, that is to say, in the process of market competition, we must protect our competitors.

He believes that "now many entrepreneurs and companies, including group buying, O2O and so on, always want to destroy all the competitors in the industry, leaving only one family, and then desperately fighting prices, subsidies, and even public relations battles, and so on, always trying to kill the second and second generation. This is a dangerous and terrible idea."

Liu Qiangdong expounded his strategy with the changing business experience of the year: "before 2009, our main competitors were new eggs and easy fast. At that time, Jingdong was making IT digital. The new egg has made 2 billion US dollars sales in the US, entered China in 2001, Jingdong started in 2004, and Yi soon began in 2005.

Before 2009, the new eggs on the market were the eldest, Jingdong was the second, and Yi Xun was the third.

Around 2007 and 2008, we actually surpassed the new eggs, and the new eggs were ready to quit the Chinese market for some time.

When we surpassed the new egg to become the eldest child, one day we had a morning meeting. I spent about half an hour explaining to everyone that we should protect the second and second generations.

Because there are old men and women, then other players will no longer easily enter the field of IT digital, because Jingdong, new egg, easy fast, three brands, prices, delivery speed, all aspects have been very strong, in this industry, you can not find any foothold, so it gives Jingdong an opportunity. With our competitive advantage becoming stronger and stronger, we gradually expanded to the whole category, forming the current market position.

In 2008, Yi Xun had some problems before he got the first round of financing. When he talked about the Jingdong's investment, I knew that Yi soon was out of the way. Only when you pushed it to a certain level, could you let your competitors vote for you.

At that time, many shareholders said that since competitors had problems, it was the best time to destroy him. We should lower the price and let him die faster.

Otherwise, once he gets the financing, he will grow up to compete with us when he gets over it, which will lead us to a disadvantage.

I told the theory in detail at that time.

Then I asked the marketing department, all the prices and marketing strategies are no longer aimed at easy and fast. We must make it easy to survive. We must not let it go bankrupt. The old competitors are not terrible.

At that time, we had about 3 or 4 months, which did not correspond to the competition price of Yi and Xun, and even deliberately left a good space for Yi soon. It was precisely because of the three or four months' protection of Yi and Xiao that it was easy to quickly survive.

When it comes to why we should protect the second and second generation, Liu Qiangdong said in his book:

First, the market needs competition.

Although many corporate slogans shout this way, they always want to be on the market and do not have competitors so that they can get their own profits.

But in fact, if there is no competition in the market, I believe that any operation, process, system, and innovation of your company will be missing.

Because you have no sense of competition, no pressure, no pressure, no innovation.

Innovation is actually forced out. When there is no way out, we can think of a way to solve it.

Therefore, the market needs competition, and competition is conducive to their "physical fitness". Just like a person running, if everyone else does not run, you are the only person in the world who will leave. I believe you will have a bad road.

And you can never expect a 100 meter sprint to run for a few seconds at the speed of your run, so that the speed will no longer exist.

Second, protecting the second and third is also protecting themselves.

If there are no second or third places in the market, it is really terrible for you. Your market position may be wrong all the time.

Why? Because entrepreneurs have an instinctive expansion mentality. Many entrepreneurs will look for this opportunity. When he finds that an industry has only one player, no second third, then countless new entrants, these rich companies will think, this opportunity is too good, I can not even become the first after entering, then second third is also valuable.

Because any industry, in general, can exist in the top three.

The first place may have very high living space and great value. Second or third of us certainly have some living space and opportunities for development. So if all the competitors are killed in the market, only when you are in the family, you will be tempted to enter the market with numerous enterprises that are not with you.

It may be a few years before the market comes from just one of you, and tens of millions of people will come in a minute. Soon they will confuse your industry, and then you will be faced with very cruel and irrational excessive competition, which in turn can cause you a fatal blow.

And if there are no competitors in the market, your own operation ability is poor. New entrants may bring more money, bring better innovation, and all kinds of operational parameters will compete with you and surpass you quickly. So protecting the old and old three is also protecting yourself.