The difference between JD and Taobao models: different profit sources affect the business model

Recently, due to work reasons, I have been studying various e-commerce products business model , which can find the most suitable business model for our company from the existing and verified models, and can guide the future product design. After querying a large amount of data, it is found that most of the existing data are based on the nature of the buyer and the seller, that is B2B \B2C C2C and other models, but after the development of e-commerce for so many years, this model classification has no much reference value. Many platforms have gone through the era of the most primitive single model, and entered the era of complex and diversified large-scale platforms. Therefore, we can only give up the "take it" principle, and instead study, analyze and expect to summarize some ideas in this regard from different perspectives, in order to provide others with ideas and design reference value for peers.

 lirunqubie

Chinese e-commerce has a history of 16 years since the founding of Alibaba. In these 16 years, many products that were unique at that time have emerged. However, after the test of time, they are still alive and active TaoBao and JD.COM It should be among the best, and these two companies also represent the two most successful business models in the world today (temporarily called self run mall model and platform ecological model).

The most fundamental principle to distinguish between different business models is to analyze the different sources of their profits. The different sources of profit points will affect the strategic planning of the business model and the provision of specific services for various roles involved in the model.

Jingdong is positioned as a shopping mall, providing more goods to users in the form of self support, focusing on controlling the quality of goods, meeting the core needs of consumer users for shopping, and achieving profit mainly by improving the efficiency of the supply chain (capital and goods turnover) and controlling costs.

Taobao (including Tmall) is positioned on the platform. It only provides the infrastructure for third parties to open stores, and does not provide specific goods. Its core service object is the organization or individual that opens stores. By setting common management rules or services to control users, it indirectly provides complete supply of goods to consumer users. The profit is mainly obtained by providing supporting services for businesses.

The following points can be summarized from these two representative Internet enterprises:

  1. The business logic is different. JD itself is the creator of the platform and the service provider of commodity trading, while Taobao is the creator of the platform and does not provide commodity trading services;
  2. Different service objects: JD serves consumers directly, Taobao serves intermediaries, and indirectly serves consumers;
  3. The profit sources are different. JD gains profits by improving the efficiency of commodity and capital flow and controlling costs, while Taobao gains profits by providing supporting services for intermediaries (including consumer users).

After controlling the efficiency and cost of the supply chain, the main goal is to pursue the integrity of the process and the degree of control over each link in the process. Only by mastering the more stages in the complete process and standardizing them can we achieve the most efficient operation, and can we be in line with the traditional operate The value is reflected in the competition of modes.

The platform products that rely on the provision of supporting services to obtain profits, mainly through the establishment of the ecosystem, gather enough popularity to provide businesses with a virtuous circle of ecology, and then provide corresponding services according to the needs of different roles in the ecosystem to obtain profits, more importantly, explore the needs of different roles, And design various services that can solve the situation in various transaction links for users.

In both modes, there is a core problem: the accumulation of user scale. The power of the business model can be brought into full play only when it is large enough; Only when the user scale is larger, the economic benefits of the transformation of supply chain efficiency improved through standardized processes can be more obvious; Only then can we grasp the initiative of bargaining with upstream manufacturers. The platform can only build a virtuous circle ecosystem after accumulating a large number of users, so as to realize the reuse of Internet products at low cost through the long tail effect, meet the specific needs of different roles in the system, and achieve profit.

 

This article was originally published by @ Liu Zhike and was published by everyone product manager

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