A detailed explanation of shared power banks (with operation strategies)

The author of this article conducted a market analysis of shared power banks , and in the face of current difficulties, he also put forward his own strategic opinions in industry operations . It is worth reading.

Attach the mind map of this article first, so that everyone can read it:

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1. Market Analysis

Shared power banks have become a popular target for investors

According to public data statistics, from March 31 to April 10, within 10 days, 5 financings were completed, more than 20 institutions participated, and the financing amount was close to 300 million yuan. On March 31, Zhu Xiaohu , who has invested in five "unicorns" in 10 years, together with star investor Wang Gang, conducted angel round financing for " Xiaodian Technology". The investment amount reached tens of millions of yuan. Other investors included Detong Capital, CMB International, Yingdong Capital and other institutions.

On April 5, Lai Dian Technology, a smart power bank rental company, announced that it had received a US$20 million Series A financing led by SIG and Redpoint China, with participation from Jiuhe Venture Capital and the chairman of Feimaotui. This is currently the largest financing in the industry. On April 9, the media broke the news: "Xiaodian" received a RMB 100 million Series A investment, led by Tencent and Yuanjing Capital, with participation from CDH Investments, Daosheng Capital, and the previous round of angel investors Wang Gang, GSR Ventures, Detong Capital, and Yingdong Capital. At the same time, there are constant stream of new entrants. Currently, more than a dozen shared power bank projects, including Dianxiaoniao and Yunchongba, are looking for investment. See the table below for more information:

The market is filled with smoke and capital is frequently deployed, but how much market imagination space can the power bank with "small profits" have? For consumers and merchants, is charging a real pain point or a false demand? Will it bring new hope to the sharing economy , or will it fall into the dilemma of opening high and closing low?

Although it grew up in the golden age of the sharing economy, the present and future of shared power banks are still unclear.

False demand or big business?

1. False demand

(1) Upgrading the originally free demand to a paid one is difficult for users to accept

Before the shared power bank came into being, most shopping malls, restaurants, and coffee shops provided free charging cables. Originally, I could find a place to charge my phone in a coffee shop, but now the waiter hands me a power bank with a smile and tells me that I have to pay 1 yuan for one hour of use? It is difficult to achieve transformation through consumption upgrade of users.

(2) The cost of power banks is not high and can be purchased directly.

The price of a power bank is 80 yuan, and the price of a shared power bank is not expensive, but the deposit of hundreds of yuan is a bit unacceptable. A shared power bank may not be used every day like a bicycle, especially it needs to be returned to a designated location and cannot be taken too far away, which is quite embarrassing. After all, it is charged by time, and it will probably only be used for emergency charging for a while. With this in mind, it is better to buy one directly.

(3) Charging is a low-frequency activity.

The necessary conditions for this user setting are: going out → going to a place with shared power banks → mobile phone is out of power → no power bank → need to use mobile phone urgently → time is tight and cannot sit down to charge or the store cannot provide charging plugs and data cables for free → do not want to buy a power bank → know about shared power banks → initiate the demand for shared power banks. Therefore, the charging scenario is not a rigid demand, but an occasional urgent need.

Assume that there are 1,000 people going out in city A. 80% of them go out within one day, which is 800 people; 50% of them go out to shopping malls, train stations, etc., which is 400 people; 20% of them have no mobile phones, which is 80 people; 70% of them do not bring power banks, which is 56 people; 80% of them need to use their mobile phones urgently, which is 44 people; 50% of them need charging plugs and data cables provided by the store, which is 22 people; 50% of them are in a hurry and cannot sit down to charge, which is 11 people; 50% of them do not want to buy power banks, which is 5 people; 50% of them know about shared power banks, which is 2 people. The above data estimates are still the most ideal estimates and have not ruled out those who resist and withdraw from the use and fail to complete the order. It is conceivable that the remaining people are pitifully small.

2. Big Business

(1) Land grabbing brings considerable profits

According to the current market price, each charging hour costs 1 yuan (charging less than an hour will be charged as one hour). A power bank that costs less than 100 yuan can be recycled nearly 800 times. Assuming the power bank is borrowed for 2 hours a day and earns 2 yuan a day, the cost of the power bank can be recovered in 45 days (of course, this does not include the costs of early marketing , counter rental, etc.). With the support of capital, practitioners are obviously not in a hurry to make profits, and quickly grabbing land has become a consensus.

If 20 power banks are placed in each of Beijing's 200,000 local businesses (catering, leisure and entertainment) and public service facilities (airports, high-speed railways, and stations), the potential size of the entire market will be close to 3 billion yuan a year. If the entire market is fully rolled out across the country, including Shanghai, Guangzhou, Shenzhen and the vast majority of second- and third-tier cities, the potential size of the entire market will easily exceed 10 billion yuan.

(2) Make shared power banks an urban infrastructure

Charging is a basic need, and power banks are also a basic need. Are shared power banks a real need or just fake sharing?

This is what Wang Zhe, CEO of Jiedian, thinks: Not many people know us yet. When we lay enough cables and produce a larger volume, users will know that there is such an infrastructure. From the perspective of our team, we would like to make this into an infrastructure.

When shared power banks are made into urban infrastructure, when users are out and about and their phones run out of power, they naturally think of shared power banks, and it becomes a lifestyle habit for urban residents.

2. Current Dilemma

Which one is the user scenario and operation model that is really needed?

1. Three current product types

(1) Desktop charging

The representative company of desktop charging is Beijing Xiaodian Technology, which has 3 sockets.

(2) Small cabinet

Small cabinet, represented by Jiedian Technology, can hold 6-12 power banks.

(3) Large cabinet

The large cabinet, represented by Lai Dian Technology, can hold 30-40 power banks.

They are based on commercial considerations of different consumer groups and different usage scenarios. Which of these three product forms is stronger or weaker? Can they coexist and develop? I think that they may coexist and develop in the short term, because the model of shared power banks is still in its starting stage, the market is relatively blank, user demand has not been fully stimulated, and habits have not yet been formed. Just like the “Hundred Regiments Offensive” back then, the market allows trial and error, and it needs more players to educate users.

However, in the long run, users are ruthless and will only choose based on the best experience. After experiencing the three products of desktop charging, small cabinet and large cabinet respectively, they will always find the advantages and disadvantages of the three products. Then, the number of users who experience the best product form will continue to increase, and the company will become more and more competitive in the market and eventually become the industry leader.

(4) Shared power banks and small cabinets have unlimited potential

The electromechanical model of the small cabinet is different from desktop charging and large cabinets. It takes the B2B 2C route, that is, the small cabinet is placed at the cooperating B-end (such as shopping malls, restaurants, etc.) to solve the original high maintenance cost problem of renting power banks. Users can take it away after placing an order online and return it to other locations after use (the model is similar to that of plug-in bicycles). Small cabinets avoid the negative experience of fixed charging piles and circumvent the heavy asset model of large cabinets.

1. Large coverage: A mall can cover 1 or 2 large cabinets, but small cabinets can cover every restaurant and every store in a mall. As a user, would you rather go to a designated point to rent a shared power bank or rent it at a nearby mall store? The small cabinet can be simply understood as covering both upstream and downstream applications. It can also be used in all application scenarios of desktop charging and large cabinets.
2. Mobility: Unlike small cabinets and large cabinets, the desktop charging terminal is a mobile power supply with a capacity of 16000mAh. It charges mobile phones and other devices by leading out a charging cable with three terminals from the port. It cannot be rented and taken away.
3. Merchant cooperation: Compared with large cabinets, the small cabinet model can be combined with cooperative merchants to solve the high maintenance and promotion costs of renting power banks. At the same time, users actively find the merchant's store through the LBS function of the small cabinet model. This powerful consumer traffic ability is undoubtedly more valued by merchants. Users come to the store to rent power banks and buy some food by the way, which is a natural customer acquisition logic. Desktop charging is only a charging service that users can enjoy after entering the store. It does not have the ability to attract customers, but it can increase user retention rate .

Shared power bank industry is booming in many places to meet challenges

1. Intensified competition among peers (capital war, market war, legal war)

With the support of capital, practitioners are obviously not in a hurry to make profits, and quickly grabbing land has become a consensus: Lai Dian Technology has proposed the goal of "100 cities and 1 million points", and has now entered more than 80 cities. Xiaodian Technology also stated that it will not consider profitability for the time being, and will first compete in density and scale. It has currently settled in 5 cities including Beijing, Shanghai and Guangzhou, and will open 20 to 30 cities next. It can be foreseen that in order to seize offline outlets, shared power banks will be another wave of capital wars after shared bicycles .

In addition, before the capital war and market war, shared power banks launched their first wave of legal battles. Recently, Lai Dian Technology initiated a patent lawsuit, suing Jiedian Technology for "patent infringement." This is not the first patent war launched by Lai Dian Technology. Last year, they also sued "Yunchongba Technology" in court, and in February this year, they filed an infringement lawsuit against "Yunzuba".

2. It is difficult to cultivate user habits from 0 to 1

The model of shared power banks is still in its infancy, the market is relatively blank, user demand has not been fully stimulated, and habits have not yet been formed. There are not enough shared power banks on the market at present, and users will not think of using shared power banks to charge their mobile phones when their mobile phones are out of power. After understanding the differences between the three models, it is easy to understand why Fenghuo Financing is now entering the shared power bank industry, because it is a competition of speed. When users are surrounded by your shared power banks, they will naturally become a part of their lives.

3. Safety hazards of power banks

Security is mainly reflected in two aspects. The first is the harm to the human body. The quality of power banks now varies greatly, not to mention that they have to pass through the hands of many people. Their quality may be difficult to guarantee, just like shared bicycles. If a safety accident such as an explosion occurs, it will be a cold wind for the brand and the entire market. The second is data security. Can users keep their data secure and private while charging? It is difficult for users to have a sense of trust, let alone use it.

4. No clear profit model

The design and profit model of shared power banks are not perfect, and there are still many chronic problems that cannot be solved. First of all, the attribute of shared power banks is that they are imported by offline traffic . There is no need for any online promotion. The product will direct traffic to itself, which determines that its operating costs will be very high. This includes multiple costs such as site rental, labor operating costs, equipment costs, etc. If you want to achieve high density and large-scale investment, the investment will increase exponentially.

From an operational perspective, it will be difficult for shared power banks to develop in the long run if their profitability relies solely on rental and charging fees. In the eyes of shared power bank entrepreneurs , advertising revenue is one of the important cash flows in the future, but its value and benefits are subject to great uncertainty. Taking the cabinet type as an example, there is not much difference between it and offline media such as Focus Media, and the competition is equally fierce.

3. Future Strategy

Industry operation strategy

1. You have it, I have it, smooth out the differences

Actively absorb and analyze the good user experience of competitors. Now even a tiny user experience may affect the overall outcome. Always pay attention and don't slack off. The reasons why users will reduce user retention and switch to other competing products include: no deposit, data cables, and recent marketing activities ...

2. Race to grab market share

Currently, shared power banks are still in the starting point stage. It has become an industry consensus to first grab land and expand the scale. Seizing the market is equivalent to seizing users. What matters is efficiency and capital. Profitability is not an issue to be considered at this stage.

3. Stimulate merchants to help cultivate user habits

Xiaodian and Jiedian are both cabinet models, B2 B2C models, and both have cooperative merchants. The cabinets are placed in the stores of cooperative merchants. It can be said that the attitude of cooperative merchants towards the cabinets determines the success of the promotion of shared power banks. This requires some operational strategies to stimulate cooperative merchants' collaborative promotion, such as: store rewards for developing new users, setting promotion codes for each store or defaulting the frequency of use of the store, giving away dining desktop supplies (advertising effect)...

4. Vigorously promote credit-based rental without deposit

The deposit in the current sharing model is undoubtedly the biggest obstacle for new users to enter. Shared bicycles are vigorously promoting credit-based deposit-free services in combination with Sesame Credit . Shared power banks can also do this. Currently, Jiedian and Laidian both require a deposit-free service if the Sesame Credit score is above 600. The call center displays “No deposit required for customers with a Sesame Credit score of 600 or above” on the cabinet, but many users are not aware that Jiedian’s credit score does not require a deposit.

5. Establish a safe brand advertising effect

CCTV's "3.15 Gala" once revealed that mobile phones charging on public charging devices are vulnerable to hacker attacks and information theft, which has caused many users to become wary. It is difficult to determine whether shared power banks are safe, which makes many users wary. This requires vigorous promotion to establish a safe brand advertising effect. Brand awareness has been established in the market, and there is huge commercial space to be explored next.

Hardware upgrades

1. Rapid development of small programs

Currently, most of the shared power banks are in the form of WeChat official account h5 pages. Due to the high cost of app development and the fact that many users are unwilling to download apps to take up space on their mobile phones, Xiaodian has already developed an app, and Jiedian has also developed mini-programs. Power banks are typically sent away after use, so it is recommended to develop mini-programs and combine them with WeChat official account promotion . Mini-programs are bound to bring huge dividends to shared power banks.

2. Realize fast charging and reduce the size of power bank

The latest news on April 26 shows that the two batteries of IPhone 8 can be fully charged in 20 minutes, and the Apple watch may become a power bank for anytime. Various information shows that the popularization of fast charging technology and the improvement of smartphone battery life are advancing by leaps and bounds every day. If you don’t want to be killed by others, you must first study the new power bank technology before others. Even if the shared power bank model no longer works or encounters a bottleneck, at least it can be transformed by combining new technologies and will not reach a dead end.

3. Cater to the tastes of young people and beautify the appearance of power banks

There is no doubt that the majority of users of shared power banks are those born in the 1990s. They like new trends and good-looking things. If you want to attract the attention of those born in the 1990s compared to your competitors, it is recommended to start with the appearance of the power bank.

4. Technology upgrades to protect user information from being stolen

Although the brand itself will not insert unsafe elements into the power bank, we must also be wary of others using the power bank to install dangerous elements and endanger the interests of users. The power bank represents the company and must improve technology to protect user information.

5. Automatic sterilization function of the cabinet

After all, power banks are portable items. If they are rented for a long time, it will inevitably cause health risks for the power banks. If the automatic sterilization of the cabinet can be achieved technically, users' concerns can be eliminated and the conversion rate can be improved.

Summarize

History always repeats itself. From the group buying wars long ago, to today's ride-hailing services, the shared bicycle wars, and the current "shared charging" wars. What is more important for them at present is how to expand quickly, increase density, and gain the favor of capital in order to cope with price wars or even subsidy wars that may be brought about by fierce competition.

After all, execution and funding will be the biggest factors in determining success or failure.

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The author of this article @玲子 is compiled and published by (Qinggua Media). Please indicate the author information and source when reprinting! Site Map