If traffic thinking is compared to the key means of market expansion, free thinking is the nuclear weapon for converting users .
Let’s talk about traffic thinking firstSince last year, traffic thinking has been criticized by marketing practitioners, especially from marketing or operations directors /VPs at the brand and macro-market level, who believe that traffic thinking is unacceptable. An almost universally recognized view is that traffic thinking is like drinking poison to quench thirst. Once the delivery stops, the traffic will dry up.After well-known multinational companies such as Procter &Gamble and Coca-Cola announced that they would gradually reduce their digital advertising budgets, the entire Internet marketing industry has begun to criticize the traffic mentality, and has issued suggestions to return to the big screen, return to television, and return to brand communication at a strategic level.Recently, Youzan founder Bai Ya said at Youzan Spring Salon that Taobao brands are mostly traffic businesses and do not have a fixed customer base. Once big brands flock in, these Taobao brands will soon fall.There are two meanings here. First, Taobao brands do not have a fixed customer base and must continuously introduce traffic. Second, big brands have a fixed customer base and bring their own traffic, so they do not need to continuously introduce traffic.At first glance, this statement sounds flawless. If you think about it carefully, there are still some flaws.First of all, the key to big brands defeating Taobao brands is not the problem of their own traffic, but the low CAC and high AR PU value characteristics that big brands have in marketing.I have talked about this in detail in many of my articles on traffic. The accelerated online presence of major brands has continuously pushed traffic prices close to the critical value.If the average click-to-purchase conversion rate in the cosmetics industry is 5% and the average click price is 5 yuan, then the cost per user is 100 yuan; the average single purchase amount per user is 200 yuan, and if the purchase is made 5 times a year, then the average annual purchase amount per user is 1,000 yuan. If the profit margin is 20%, then the ARPU value per user is 200 yuan. In this case, Taobao brands in this industry can continue to purchase traffic and make money. A user can earn 100 a year. The money earned today can be used as advertising fees tomorrow, 365 days a year. Since they are making money every day, most of the money they earn is invested in future advertising fees. In an ideal situation, according to the compound interest investment, by the end of the year, the advertising fee for one day can reach an astonishing one million.However, when a big brand enters this industry, its ARPU value may be 500 yuan, then its CAC target may be 300/400 yuan. What will happen? Assuming that the conversion rates of big brands and Taobao brands remain unchanged, the final CPC will become 15/20 yuan. This cost directly makes it impossible for Taobao brands to buy. If they don’t buy, they will go bankrupt, and if they buy, they will lose a lot of money. What's more, big brands often have better conversion rates and their brand influence is there.Seeing this, some people will definitely say, you have said so much, but your traffic thinking is still not enough.We know that early traffic thinking is very effective. As long as you invest money in Baidu, navigation, or even do SEO for free, you can be very successful. Later, I started using Weibo, doing ASO , and investing in big WeChat accounts, and the results were amazing. It’s no myth that 1,000 yuan can bring in millions in sales. You should know that when Baidu is at its best, it can achieve a 50% conversion rate, which means that one purchase will be made for every two clicks, and one click costs only a few cents. When the effect of WeChat large accounts is good, a large account costing 1,000 yuan can bring in hundreds of purchasing users, and the effect is surprisingly good.Many people would say that none of these work now. It won’t work, especially for small brands or no brands. The results of investing in these channels are very poor. But if you invest in other channels, the effect may still be very good.For example, the express delivery channel which has been very popular recently. The advantage of the express delivery channel is that the user group is very precise, the display scenario is relatively strong, and the conversion path is better than that of strong pure offline media such as Focus Media, because you receive information through your mobile phone when you pick up the package.Another example is the shopping mall based on consumption upgrading, where the leisure tea shops, coffee shops, and claw machines are all very good traffic channels.It’s not that traffic thinking is no longer effective, but that the traffic spread channels will continue to change.When all competitors flock to the same type of channel, the profit margin of this channel will continue to shrink. Just like the big WeChat accounts, the effects were very good at the beginning, but then became average, and then to the point where big WeChat accounts only cooperate with brand companies. This is a very typical phenomenon. Every traffic channel will go through such a process. For marketers, what you need to do is to constantly look for new channels for profit margins. If you compete openly with large companies for regular traffic, you will have no chance of winning.For most companies, they all start with traffic thinking, and no one has a fixed customer base at the beginning. You must first have a group of customers, serve them well, convert them into a group of regular customers, and then continuously build your own reputation and brand.Let’s talk about free thinkingAlipay has recently launched a series of actions, first allowing users to waive bicycle deposits by scanning the Ant CreditQR code , and then providing free insurance by paying with Alipay, which has quickly attracted a large number of users. In today's world where the cost of acquiring customers on the Internet is extremely high, the free thinking has played an indispensable role in achieving such results.Many people are disgusted by the idea of free things, thinking that if you are free, you cannot provide good service and you cannot provide good products.Is Haidilao ’s service good? But I didn't charge you a penny.We will not discuss the business logic behind the free thinking here, such as rigid demand, high frequency, etc. I just want to talk about how to apply free thinking to the process of acquiring users in combination with traffic thinking.First of all, it’s free. We view promotions or subsidies as a marketing method with a free mindset.When Didi was first launched, it offered huge discounts. This was certainly due to the price wars among various competitors, but to a large extent, it was because Didi considered subsidies as its first strategic marketing consideration: free, free, and free again! Test in small batches first, find the critical point of subsidies for users, and then place heavy bets.In actual operations, many companies find it difficult to do so. On the one hand, they are restricted by the company's system, various opposing voices, market strategies, etc., but more importantly, the marketing decision-makers are wavering. The free thinking itself goes against the business principles of marketers. For a marketing decision maker, costs are very sensitive. When doing promotions, many people will think, 50% or 60% off? The more you can save, the better. Let’s just give it a 40% discount. But it is very likely that users will not pay for the 40% discount. Users are smarter than we think.The consequence of indecision is that limited resources will slowly become cannon fodder in the fierce market competition, just like squeezing toothpaste.I once gave an inappropriate example at a dinner party. In the Battle of Sarhu during the Ming Dynasty, the Ming army sent out 100,000 troops and lost to the Qing army. Then it sent out more than 100,000 troops and lost again. Then it sent out hundreds of thousands more troops and still lost. Because every time I am not firm enough and determined enough.Don't feel bad about investing too much resources, and don't think that too much subsidy will lead to waste. You think a subsidy of 100 yuan is enough, and a subsidy of 200 yuan is equivalent to a waste of 100 yuan, but users are much smarter than you think, and the market is much more cruel than you think. Rather than dying slowly and painlessly, it is better to move forward firmly from the beginning.If traffic thinking is compared to the key means of market expansion, free thinking is the nuclear weapon for converting users.After being educated by countless Internet products, domestic users have become accustomed to the free thinking. Without subsidies and benefits, if you want to directly turn them into your users, relying solely on brand building and product improvement will probably lead to theoretical fantasies.One night, I had a barbecue in the luxury residential area of Houhai. It was a high-end restaurant, but the average price per person was less than 150 yuan. The average price on the menu was not high, and the service was also very good. I was thinking, why didn't he set a high price? There are no competing stores nearby. Perhaps the store owner understands very well that the surrounding consumers are rich, but they are not stupid, or his products are not worth such a high cost for users.Open Dianping.com and you will find that Libaoge has long been ranked first in the reputation of Cantonese cuisine in Shenzhen. It is only in the past six months that they have suddenly started to focus on marketing, offering long-term discounts with huge discounts. In fact, their products and taste are quite good. Later I figured it out, they just wanted to dominate the food list on Dianping.com and make people queue up until their legs get tired every day, just like Heytea 's hunger marketing.The more developed and transparent the information is, the more choices users have. When there are more choices, more channels, more convenient locations, more sellers, and improved advertising recognition capabilities, according to the 4P theory, what can impress users? Price, of course, only price.Indeed, product is king, just like my marketing focus shifts from marketing to operations to product.
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