TTPPRC business model, acquire MBA's business analysis ability in 30 minutes

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This is an era of entrepreneurship for all, but whether you want to be the next Jack Ma or just want to open a coffee shop, let me tell you the answer in advance: bankruptcy within two years is the inevitable fate of most people. Our daily lives are surrounded by business myths one after another, but no one knows about those losers who left sadly. The business world is like a blooming poppy, full of unknowns and temptations, and humans have limited cognitive abilities, so they cannot accurately predict what will happen, nor can they accurately understand what is happening.

But this does not prevent us from thinking that we know a lot about "doing business". When evaluating the work of others, everyone is an expert. Is the business of Diaoye beef brisket booming? It's just good marketing. How many millions of copies of Zhang Jiajia's "Passing By Your World" were sold? It's easy to cheat the money of literary youth. Why did Uncle Tetsu go bankrupt one after another? The products are too single. Evergrande Ice Spring lost more than 2 billion? The price is too high. These views are not all wrong, but they are almost worthless. Because the ultimate success or failure of any business activity is determined by the interaction of a series of complete links. Can calling the stainless steel on the frame "austenite 304" help sell tens of millions of mobile phones? Can Uncle Tetsu save his fate of failure by expanding his product line to the same length as Holiland? The answer is obviously not that simple.

So, what is the secret behind the success or failure of the thousands of businesses in the world? The purpose of this article is to discuss this issue in depth and seriously with those friends who really want to make money.

To be precise, the difference between successful business decision makers and ordinary consumers is that the former can understand the causes of the same phenomenon in a more detailed and profound way, and know how to take corresponding measures to change the phenomenon (even if this judgment is not 100% accurate). In fact, like engineering, medicine, and computers, business is a serious and profound subject. Just because the threshold is relatively low and contains considerable uncertainty, your relatives and friends think it is "relatively empty" when you choose your major in school. The older generation of "tycoons" entrepreneurs around you may not have read any business books and have done a big business. Many people inevitably cynically believe that the key to business success is luck and opportunity rather than technology and accumulation. However, as the traditional channel economy in Chinese society gradually shifts to a fully competitive market economy, more and more people realize that no company is born to be evergreen, and no one is born with a "business mind". Only by constantly improving their business capabilities through continuous learning and practice can they become "lucky" survivors in the "survivor bias" phenomenon of the cruel business world.

In order to systematically understand the business phenomena around me, rather than just perceptually cognizing like ordinary consumers, I have summarized a concise and practical six-step business model based on the classic business theories I have learned over the years and the problems I have encountered in practice, including the six mutually echoing links of TTPPRC, to help me quickly interpret the details of successful and failed business projects. Of course, the most important thing is to analyze which link of my business has defects, how to adjust and improve, and ultimately defeat competitors and make money.

Next, I will share with you this six-step business model system called TTPPRC (I have a limited vocabulary and have searched through all the synonym dictionaries but still can't find a word with a more suitable first letter to form a catchy abbreviation similar to 4P or SWOT). The full text is crazy long, about 16,000 words, and it takes at least 30 minutes to read it carefully, so literary youth can just close it or share it after reading this. After all, I can write "The Confusion of Our Generation" in an afternoon, but I prepared for this article for several years.

I wouldn't say that I'm not very knowledgeable, but there must be some shortcomings. I only welcome friends with a certain level of in-depth thinking ability to communicate with me and correct me.

From the Mystery Method to TTPPRC

Business schools generally divide business courses into several categories, such as accounting and finance, strategy and market, and operation and management. They constitute the elements of business activities. It can be said that a successful enterprise must be excellent in each aspect. However, as an outsider, it is difficult to use this classification method to understand the direct performance of an enterprise in the market. Whether it is the SWOT analysis that must be pretended at the beginning of every business plan, or the Porter Five Forces that MBAs must read, they all have their own set of rigorous logic and eventually become a classic of a generation. Unfortunately, after I left school and no longer had to write papers and make PPTs, I found that when I just wanted to know why Guo Jingming's movies can have a box office several times higher than Feng Xiaogang's, why Haidilao is crowded with people while Sichuan hot pot restaurants with more authentic taste are deserted, these classic theories in textbooks are no more helpful to my thinking than "Guo Jingming is good at marketing" and "Haidilao has good service". They are like warning simple boys that if they want to have a beautiful girlfriend, they should be sincere, kind, hardworking, gentle and considerate. They are too far from the results and too poorly operational.

Until later, I came across a book that directly laid the foundation for my business thinking, but it was not suitable to be placed on the bookshelf and recommended to everyone. Its name is "The Mystery Method"... This is a book written by a loser to many losers to teach them how to pick up girls. It no longer tells you that you need to be kind, sincere, gentle and considerate, but systematically explains the decision-making process of women in choosing a spouse from how men and women develop step by step after they meet to how the relationship is finally established. This Canadian loser's new dimension of analyzing the problem from the decision-making process of decision makers made me suddenly enlightened. I suddenly realized that the essence of all business activities is to understand and guide the consumption decisions of target customers, and all consumption activities follow a similar process. All components of business activities, whether management or marketing, serve the links in this process. Finding these links will also find the direct factors that affect the final sales.

Because of this major discovery, I was so excited when reading the Mystery Method that I couldn't calm down. The girls I liked back then have all become wives, but I still can't remember what M3 is (isn't it BMW's performance car?). But in the end, I came up with this simple and efficient six-step business model, abbreviated as TTPPRC, which are: Trend, Traffic, Package, Product, Revisit, and Corresponding Cost.

This classification method is not very precise from a logical point of view, because the six links are not strictly independent of each other. The first five elements must consider the corresponding costs. Strong products will bring in more traffic, such as the word-of-mouth college entrance examination cram schools. Sometimes traffic becomes a package itself when it reaches a certain level, such as the number of views of popular products in online stores, etc. However, its high analysis efficiency, wide range of application, and strong operability are better than all the business models I have studied before. Not all business theories are used to publish PhD papers. TTPPRC is really used to guide business behavior.

And now I am going to show you how.

Trend

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Let’s not talk about the relationship between Xiaomi and “standing on the wind, even a pig can fly” for now. Going with the flow is the primary factor in all business activities. In the face of the trend, personal ability is ultimately insignificant. Even if a business legend like Shi Yuzhu came back to the stage and insisted on opening a music and video store selling CDs and cassettes in 2015, the probability of success would be very small. Leaders in any industry who go against the trend are like a mantis trying to stop a chariot in the face of the rolling wheels of the times. Even Steve Jobs’ iPod Classic may not be a match for a second-rate mobile phone manufacturer today.

For most businessmen, reversing and predicting trends are fantasy and not necessary. Jack Ma is not the first to do e-commerce, and Haidilao is not the first to sell hot pot. After all, the life cycle of a general business project is much longer than the fluctuations in the financial market. The first person to try something new, except for a few geniuses with a long-term vision and those with great luck, does not have a high risk-return ratio.

For example, wearable devices are extremely popular nowadays, but few people can really understand where they will go in the future. Even if Google, which is rich and powerful, launched the shocking Google Glass, it ended up with nothing. If you are not rich and powerful or have certain technical barriers, the risk factor of entering this industry is extremely high. Even if the market for wearable devices is really mature one day, people around us will start to wear all kinds of electronic products. Without the preconceived notion of patented technology, it will not be able to withstand the slaughter of Apple and Xiaomi. As an ordinary entrepreneur, if you find an obvious market gap before your insight is amazing, then the biggest possibility of this market is that it does not exist at all.

In fact, it is extremely difficult to understand trends, let alone predict and reverse them. The tablet computer market, which was popular for only a few years, has now become a sunset industry. Young people are starting to go shopping in shopping malls instead of department stores. The price of a bowl of beef noodles in Dalian has doubled in the past 10 years, but it is still 3 yuan per hour to surf the Internet in an Internet cafe. Instead of trying hard to interpret why there is such a trend, it is better to always pay attention to the changes in trends and follow the trend of the times.

In summary, among the six steps of the TTPPRC model, Trend is the first link and can be said to be the major premise, but it is not the link that easily gains competitive advantage. The key principle of most commercial projects in this link is not to make big mistakes. It is too difficult to stand out. Xi Jinping has cracked down on public spending on food and drink. If you want to open a restaurant, you should open a light restaurant in a shopping mall instead of a three-story seafood restaurant. Jingdong and Suning in Beijing both deliver on the same day, so don't rent a stall in Zhongguancun to sell mobile phones. Renren.com's big Vs don't update anymore, so just study Weibo and public accounts carefully.

Of course, there will always be a group of people who, like Mr. Yu Minhong, founded New Oriental in the early days of the self-funded study abroad craze, or like Mr. Chen Ou, who accurately launched Jumei Youpin on the eve of the verticalization of domestic e-commerce, don't worry about whether they predicted the trend or were lucky. After all, the trend is only one link in the success or failure of the entire business activity. When HTC made Hero, Samsung and Huawei were still playing in the mud. It can be said that in the entire smartphone industry, except for the iPhone, no one has a better grasp of the trend than HTC (Meizu M8 may have a different opinion). Now, all that is left is the double chin of M9, which will be remembered when people complain.

Traffic

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No matter what you want to sell, you must first let people know that you are selling it. This seemingly plain sentence has made Google worth hundreds of billions and Baidu worth tens of billions, and they are all free for ordinary users. It is free to open a store on Taobao, but you don’t have to buy a through train (the Taobao store owner who likes to say God bless everyone good night said haha). With the advent of the Internet age, people are increasingly aware that traffic itself is a huge business. There are too many companies in the world selling things, and most of them, we will never know about them. So in order to let us know that they provide such a consumption option, they spend a lot of money.

In TTPPRC, I simply define traffic as letting target customers know that they have such a consumption choice. The four most important words are target customers. The amazing traffic of online voice and video on the YY platform is a mess when it is extended to online education. Obviously, YY users who play online games and watch beautiful women dancing will not suddenly become ambitious young people who sit in front of computers and pay for classes; the shopping malls with the largest flow of people are suitable for Uniqlo but not for Chanel; you will never see Rolls-Royce ads on TV; the cumulative clicks of "The Confusion of Our Generation" have reached tens of millions, and Dalian Qiaodongjia Crispy Fire Roast will not sell more...

The above examples look simple, but they are not so easy to apply. Whether the actual traffic is effective or not depends on the specific problem. For example, my own cake shop is located in the core position on the second floor of a second-tier shopping mall in Dalian, and there is a constant stream of people passing by every day. Although the mall is not positioned high, the price of my cakes is also cheap. At the beginning of the store, I had high hopes for this location. It was not until I found that the surging crowds hurried past without looking up that I realized that it was not that they would never be my target customers, but at least not when passing by this location. It turned out that there were seven or eight buffet restaurants upstairs in the mall, and each of them was doing a booming business, and my store location was the only way to go to these restaurants. A considerable number of people passed by the door of my cake shop on their way to the buffet after being hungry for three days or just came out from there leaning against the wall. Instead of selling cakes, it is better to sell stomach-strengthening and digestion-promoting tablets.

In order to have a more complete understanding of the concept of traffic, let's discuss a few divergent but specific examples.

Traffic is not a panacea. It is closely linked to the next step of the six-step model, packaging. No matter how high-quality the traffic is, it will be wasted if your business project is not packaged well. For example, Tencent opened a secondary entrance for Dianping on WeChat because it invested in Dianping.com. However, the huge WeChat traffic did not bring a very high conversion rate to Dianping.com's group buying. An important reason for this is that the comprehensive experience of the WeChat secondary entrance is much worse than that of the separate Dianping.com App, and the effect is average at present.

Strong brands can spontaneously import traffic. For example, the location of Home Inn can be worse than that of local cheap hotels, and target customers will find it by themselves according to the navigation. We will see this repeatedly in the cases below. The first function of a brand is to import traffic.

Different business projects have very different specific demands for traffic. Generally speaking, the more standardized and substitutable the business is, the more important the traffic link is in the entire business, such as selling iPhones on Taobao, selling milk tea in shopping malls, selling studying abroad in Haidian Huangzhuang, etc. Businesses with strong differentiation have relatively smaller demands for direct traffic, and can use clever promotional methods to bring target customers to their doorsteps, such as private clubs, Hermès Birkin, and well-known angel investors.

The reason why monopoly industries are so profitable is because they monopolize the traffic of rigid demand. I dare not give examples.

The target customers are enterprises rather than mass consumers (B2B and C2B), and the power of the sales team determines the traffic. The fascinating workplace novels "Circles and Traps", "Winning and Losing", and "Doing Business" all tell stories about obtaining effective traffic. And many businesses that seem to target ordinary consumers also import their main traffic through sales teams rather than mass advertising. For example, most state-owned enterprises in Beijing will give out Weiweimei bread cards as employee benefits instead of Paris Baguette.

Mobile Internet is the king of traffic today. Before that, it was PC Internet, and before that, it was TV! Without TV, NBA players’ income would not be much higher than that of drama actors. Performing arts companies understood the importance of hype long before the advent of the Internet era, simply because their business requires too much mass traffic.

The charm of Internet entrepreneurship lies in that the Internet breaks the geographical restrictions on target customer traffic in traditional industries. In fact, although the traffic restricted by geographical restrictions is limited, it is also a natural protection. A clothing store in a prosperous commercial street that is not doing well can sell a few pieces of clothing a day. The traffic of the Internet has a Matthew effect. The majority of merchants selling clothes online are closed every day. Since the day the Internet industry was born, it is destined to be polarized. Platform-level enterprises are only winners, and at most two heroes will emerge. As for the third place, what is the third place?

There is no need to make a complicated analysis of the reasons why 99% of Internet startups are doomed to fail. Traffic is the only hurdle they cannot overcome. Whenever my friends passionately tell me that they want to make a mobile app and change the world through mobile Internet, I will gently accompany them to open the App Store, look at those unfamiliar names, and tell them that the distance from the software store to the user's mobile desktop is measured in light years. I still remember looking at the list of 50 representative online education companies that went bankrupt at the end of last year. Except for Gong Haiyan's ladder network, the remaining 49 companies were swept out of the market without my even hearing about them. Internet entrepreneurship is still the most perfect trend of the times, but if you don't think clearly about how to get through the hell gate of traffic, you don't need to consider other links at all.

As the business of Internet traffic has gradually become a monopoly industry, the price of network traffic is also getting higher and higher. At present, the most cost-effective way to import traffic from the entire network in China is still Weibo and WeChat public accounts. Zhihu and Douban can be regarded as the second echelon (local O2O traffic is mainly controlled by Dianping and Meituan, Weibo and WeChat are slightly worse). You see, the bigwigs in traditional industries like to make a fortune in a simple way, while the founders of Internet companies or those with the Internet as the main sales channel pretend to be happy and work as hard as Lu Qi and Liu Jishou, sharing their daily life insights with netizens (B2B Internet company bosses are not included), and even appearing in your parents' WeChat Moments.

In the final analysis, the primary criterion for a businessman's business ability is how much traffic he can bring to his business. Whether it is the older generation of entrepreneurs drinking until they vomit blood in order to win an order, or Meng Bing visiting Pan Shiyi and finally winning a prime store for Xishaoye in Wangjing SOHO, or Guo Jingming willing to let Yang Mi post a Weibo to joke about her sexual orientation in order to build momentum for Tiny Times, they are all manifestations of first-class traffic diversion capabilities. Of course, the classic method of relying on word of mouth to let more consumers know that there is such a consumer option has not been eliminated, but it alone can no longer keep up with the development speed of this era.

Package

The packaging mentioned here is not the box that wraps the product, but a broad concept that includes a series of non-direct product experience display parts such as the design aesthetics, marketing promotion, brand story, pricing discount, etc. of a business project. In other words, after the target customers know that they have such a consumption choice, how your business will be presented to consumers.

Package is a somewhat bland word. I prefer to call it a gimmick. In an era when the price of online and offline traffic is rising, packaging without even a gimmick is a waste of traffic. In fact, unless you are selling a commodity that can be bought and sold directly on a commodity futures exchange, packaging is largely the decisive factor in the success or failure of the entire business, not the product itself!

Look at the well-known entrepreneurs we know, all the "business wizards" who have made achievements in multiple fields, such as Steve Jobs, Shi Yuzhu, Lei Jun, Diao Ye, Guo Jingming, etc., their common feature is that they have superb "packaging" ability. It is worth emphasizing again that being good at "packaging" is not just being good at "marketing". An excellent package is a comprehensive reflection of superb management and coordination ability, leading strategic vision, hungry sales team, first-class comprehensive execution and other qualities. All the impressions of your products before consumers pay for them are determined by the quality of the packaging.

The most common frustrated businessmen in the market always like to emphasize "My product is excellent, it's just that consumers are too stupid to experience it", and their frustration is doomed. In fact, whether a businessman's understanding of business is considered entry-level or not, the most basic distinction is whether he can realize that packaging really determines whether consumers will consume your product! Rather than the quality of the product. The product itself determines whether there is repeated consumption and the introduction of new traffic (word of mouth)! The most important criterion for measuring the level of an entrepreneur's business ability, in addition to importing traffic, is the ability to create packaging.

Why the impact of packaging on business can be more important than the product itself, we need to analyze it from the perspective of how people make consumption decisions. A consumer decides whether to consume your product, not based on the actual experience of the product (because he has not used it yet), but based on whether the expected experience of the consumption in his mind exceeds the monetary value he needs to pay. This expectation is not only emotional, but also extremely easy to be guided.

To be more specific, people’s perceptions of short-term attraction and actual experience are two completely different things, but consumption decisions are mainly determined by short-term attraction, which is the “packaging” emphasized here; while the product itself provides actual experience, which determines whether people will repeat consumption and recommend it to others.

For example, when a consumer decides to buy a new iPhone for the first time, it is not because of the elegance and efficiency of the iOS system, nor because it is not easy to lose power in standby mode, nor because it is not as slow as Samsung after half a year (although the above mentioned are the core competitiveness of Apple mobile phones that kill Android in technology). Instead, it is more out of the short-term attraction of "this phone is so beautiful", "rich and handsome people are all using it", "where are there so many reasons why this is Apple"? In contrast, the excellent actual experience of the iPhone product itself determines the extremely high loyalty of iPhone users, which is the revisit consumption (Revisit) to be mentioned later. On the contrary, Samsung mobile phones are second to none in the mobile phone industry in terms of packaging, almost not inferior to Apple. The large screen, super configuration parameters, massive advertising and Korean drama implantation that were first adopted have led to a large number of first-time consumption. Unfortunately, the poor user experience of the product has led to low consumer loyalty. But the real reason why Samsung suffered a Waterloo in the S5 was that the package itself had fallen behind in the market competition. The hardware parameters were no longer as amazing as those of the S2 and S3. The unchanged appearance design, coupled with the old large plastic and protruding camera, could be said to have no gimmicks at all. Although from a professional perspective, the actual experience of the S5 product itself has actually made considerable progress, especially in terms of battery life and photo quality, which is a substantial leap compared to the S3 and S4, it still became Samsung's worst-selling product in recent years.

Package affects consumption decisions, and product affects secondary consumption. A more common example occurs in the marriage market. In most cases, women who hold decision-making power make consumption decisions based on short-term emotional attraction. For example, men who are funny and mysterious, romantic and handsome, powerful and wealthy, etc., all belong to the category of packaging. Whether they are willing to enter into a relationship with the other party is basically determined by the packaging. Otakus believe that they have a stable career, are filial to their parents, are diligent in housework, loyal, and will be a good father. These are the advantages of the product itself. They are not unimportant, but they must be experienced by the other party after a relationship has begun. Unfortunately, they are like those stupid businessmen who emphasize "My product is excellent, but it's just that the consumer is too stupid to experience it." They have not figured out that the key to influencing consumption decisions is packaging! Not the product!

Let’s continue with a few divergent examples.

For some extreme business models, there are no products at all, and the core of the entire business is packaging, such as the pyramid scam of selling facial masks on WeChat.

The premium of a product is mainly determined by its packaging. Packaging ultimately makes a brand, and brand is the ultimate packaging. Roseonly’s roses can be sold for 999 yuan each. It is not enough to rely on the beautiful box and the origin of the roses, but the vulgar but effective packaging that says “can only be given to one person in a lifetime”.

Whether it is Haidilao, Xiaomi Note or the goddess of your school, they all deeply understand that the most powerful packaging in the world is queuing. And entrepreneurs who can play the queue well are top packaging masters, whether it is a real queue or a fake queue. People's nature of liking to follow the crowd is determined by genes.

The packaging ideas of the B2B industry are completely different from those of the B2C industry. The average IQ of corporate customers may be more than 50 points higher than that of ordinary consumers, but the main reason is that the two have different demands, and there are self-contained interest relationships in enterprises. In short, the packaging ideas should be Huawei rather than OPPO.

The less core technology a product has, the more it is a competition of packaging capabilities. For example, the water bars in shopping malls. The recipes of Happy Lemon, CoCo Tea, and Gongcha are not secrets, but now in the mid- to high-end shopping malls in major cities, it is difficult to see local brands of milk tea competing with the above brands. They are all national franchise brands, and their advantages are entirely in packaging rather than products.

The packaging should be well connected with the traffic. The same brand of restaurant, opened in a shopping mall and a community, the store design and even the menu content are different. For the same e-commerce brand, the store packaging on Taobao should be simple and efficient to increase the conversion rate as the primary task, while the packaging on the official website should focus on improving the brand image.

Excessive packaging will certainly hurt the reputation of the product to some extent (because people tend to have excessive expectations), but it may not necessarily hurt the overall effect of the entire business. In the following case study, I will mention that if Diaoye Beef Brisket did not have the superb publicity of Diaoye in the early stage, but just quietly opened a chain restaurant in a shopping mall like Lugang Town, its reputation must be much better than it is now, and it may even become a god store that is passed on by word of mouth, but the overall sales situation must be worse than it is now. The amazing traffic brought in by excessive packaging and the first consumption it promotes are far more important than the bad reviews caused by excessive expectations of consumers in the later stage. The same is true for Luo Yonghao's Hammer phone, but the Hammer has too many flaws in quality control, and as a standardized hardware, mobile phones are also easy to be caught.

In short, packaging is the core of an entrepreneur's business ability, and it takes time to get started. But it is not difficult to get started. In my opinion, you only need to read three books carefully to get a general idea of ​​the wonderfulness of this art. They are all short and quick works that are not very rigorous but can be quickly mastered: Deng Delong's "2-Hour Brand Literacy", Sally Hogshead's "Obsession" and Martin Lindstrom's "Brand Brainwashing".

Product

The essence of business is to provide products in exchange for corresponding returns. In the fourth link of TTPPRC, we finally talked about products. This is not because products are not important, but as an excellent businessman, strong business literacy is mainly reflected in the ability to combine the best products within one's ability with other links. Providing absolutely technologically advanced products is beyond the ability of a "businessman". For example, we all know that selling airplanes is very profitable, but it is much more difficult to make money by running an airline. Branson, the boss of Virgin Group, is considered a peerless business genius. He was able to establish Virgin Airlines and make profits year after year in the tragic Airline Business, but he could not make airplanes to steal the business of Boeing and Airbus. If any person or company can suddenly develop a drug that cures AIDS, it does not need any help from trend traffic packaging to quickly dominate the market. This extremely rare case is not worth exploring business concepts.

The product we are discussing here has a certain threshold, but it is not Rocket Science, where the technical barriers are so high that no one in the market can provide the corresponding product. The concept of product is not just the object itself, but also includes the complete experience that consumers get after a series of consumption behaviors such as service, maintenance, after-sales, etc.

We will discuss this from two aspects: 1. What is the main function of the product? 2. What should a good product include?

In the previous section on packaging, it was repeatedly mentioned that the main function of a product is to promote secondary consumption and introduce new traffic, rather than to facilitate consumer decisions. Because when consumers truly get the complete experience of your product, the consumption process is actually completed, which means that the money has been earned. If your business model is to sell a product only once in a lifetime, then the quality of the product itself is a legal and moral issue rather than a commercial interest issue. However, the actual application of this business model generally only occurs in fraud. Normal business activities pursue long-term development, which requires repeated consumption by consumers who have already consumed and new customers to engage in new consumption behaviors, and these two things are determined by the product itself.

Before the advent of the Internet era, consumers faced a high degree of information asymmetry when making consumption choices. Therefore, "word of mouth" has always been a decisive factor in the survival of a company. Everyone must have encountered a small restaurant recommended by a friend, hidden in a secluded alley. According to our TTPPRC model, the natural traffic is a mess, the decoration is mediocre and there is no advertising. The packaging can be said to be substandard, but the business is extremely hot. We call this phenomenon the repeat customer effect. Malcolm Gladwell subdivided it into connectors, insiders and salesmen in "The Tipping Point" for detailed research. From the perspective of TTPPRC, it is the excellent product experience that promotes secondary consumption and introduces new traffic. It also comes with the same heavyweight packaging as "queuing" - "recommendation by acquaintances". After the advent of the Internet era, the word-of-mouth spread of products is not limited to acquaintances but can spread throughout the entire network. Many businesses that used to have limited traffic and packaging have obtained a large amount of high-quality traffic and packaging from the entire network because of their excellent product experience, which has completely changed the fate of the company. Independent musicians like Song Dongye can tour the country, Rovio has become a world-renowned gaming company with its Angry Birds, and Lao Gan Ma's hot sauce has become popular among North American students. These are all classic cases.

On the contrary, there are countless business cases where the trend, traffic, and packaging are very strong, but the product quality is too poor. Some are simply identified as frauds and prosecuted, such as Yilisheng and Dumianma Mask; some cannot be directly identified as frauds but are not far off, such as Li Yang’s speech, Tang Jun’s book, Chen Anzhi’s class... They cannot survive in the market for a long time.

In short, the power of an excellent product is so great that it can instantly connect the four elements of TTPPRC (product, traffic, packaging, and repetitive consumption), which is something that any other link cannot achieve no matter how well it is done. Therefore, for a company that intends to do long-term business, product quality is always the top priority.

The products we discuss here are all-encompassing, but good products have the same common characteristics, which are determined by people's way of understanding things. So what exactly is considered a good product? In simple terms, there are actually two:

First, it must have the same distinctive features, and second, there must be no flaws in other aspects. Distinctive features can leave a deep impression on consumers, while the absence of flaws in other aspects is to avoid giving consumers obvious reasons to give up. Both are indispensable.

You can imagine this process as a girl going on a blind date. Man A comes from an ordinary family with a normal job and looks 6 points, but is extremely humorous; Man B is talented, worth over 100 million, looks like Daniel Wu, but unfortunately he is blind. In comparison, for most women, A may be a better choice.

The feature of Man Coffee is its elegant environment and unique decoration, and the taste of its drinks is mediocre but not bad; the feature of BMW cars is its excellent driving experience, and although the interior is not as good as Audi and Mercedes-Benz, it is acceptable; the feature of the movie "Everything Grows" is that Fan Bingbing is charming, and the other plots are not outstanding but not too bad...so the above are all relatively excellent products.

In the mobile phone market, the machines with good reputation in 2014, such as Xiaomi 4, vivo X5, Huawei Honor 6, OPPO Find 7, OnePlus, etc., are typical "features, no flaws". In comparison, many friends with more difficult fates do not meet these two requirements: Nokia 1020 has 41 million pixels, but unfortunately the system is Windows; HTC M8 has a beautiful metal shell and Beats sound effects, but unfortunately the double chin is unbearable to look at; Sony Z3 has no flaws, but unfortunately, it seems to have only three-proof features that are not very attractive, except for its high price. Hammer T1 has a beautiful system and outstanding feelings, but unfortunately it often has no signal for unknown reasons, it is as hot as a heating pad, and it is so heavy that you want to buy it. It needs to be charged three times a day, and changing the card is a pain in the ass...

The last thing worth discussing in the product (Product) is called details. Details are also a significant sign that reflects the business literacy of merchants. Why do you have to be obsessed with details pathologically? Because although consumers have a slow thinking ability, their intuition is keen. They are not enough to see through the differences in each link, but they can feel that the iPhone is "easy" and Samsung is "not easy to use"; going to Haidilao to eat hot pot, the hot pot restaurant in the community is "uncomfortable"; professional players you meet at nightclubs make people "feel", and the "uninteresting" you met on a blind date.

For friends who are familiar with the Internet, if you compare similar products launched by different manufacturers, you will find that although the same function is achieved, Tencent's products are better than other people's experience. QQ eventually forced MSN out of the stage of history. If you are used to using QQ email, then exchange it for 126 or Sina email, let alone the omnipotent WeChat. Even if it is not because of the traffic import of QQ, the experience of WeChat products itself has long left Whatsapp, communication, and Yixin thousands of miles away. These are the power of details generated by Tencent because of its best product manager.

Revisit

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Let's look at another case. If you invested $1 in a company in 1968, you could get a return of $6,638 by early 2015, while the S&P 500 index returned $87 during the same period. Interestingly, this company has neither conquered cancer nor landed on the moon. Not only is it impossible to climb any high-tech, but the products it has produced for more than 40 years have changed. It is the Altria Group, the parent company of Marlboro cigarettes.

The R (repeated consumption) link of TTPPRC discusses the difference between cheese cake and cigarettes.

Let’s start with a simple example. As consumer-grade electronic products, laptops and smartphones are similar in popularity. Moreover, the average price of computers is higher than that of smartphones. But why are businessmen around the world making mobile phones instead of laptops? Why can an iPhone make Apple soar from a 70 billion company to 700 billion? From the perspective of TTPPRC, the trend, traffic, packaging, products and costs of Macbooks and iPhones are similar in terms of trends, traffic, packaging, products and costs, and the secret from 70 billion to 700 billion lies in the huge difference in this repetitive consumption (Revisit).

A computer with good quality can last for three to five years, but no matter how easy it is to use it, it can hardly escape the fate of changing it once a year.

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It is hard to imagine that at that time, few people raised the issue that, like most mobile games, Draw Something’s repetitive consumption was a serious problem, especially when Zynga had the most repetitive consumption capacity in the English Internet mobile game world, Texas Hold’em. In less than half a year, Draw Something fell at the speed of light, and Zynag also plummeted due to the failure of the 200 million US dollars of investment, which became a lesson that everyone in the Internet and investment circles must talk about. If they could use the TTPPRC model to strictly analyze this project, when they analyzed the repetitive consumption, would the 200 million US dollars still be so happy?

There is nothing new in the sun, and history repeats itself every day. So whenever I see the app that is full of fantasy, cute face, and foot memory, but does not have any repetitive consumption capacity at first sight. I have to sigh that this is indeed a golden age of entrepreneurship that will be inexhaustible after I come here.

Of course, it must be mentioned that not all commercial projects require revisit. In the product section, we talked about the quality of the product directly affects revisit. For example, a restaurant tastes good, so we will eat it repeatedly, and a writer will buy his next work. However, for most people, such as wedding etiquette, college entrance examination training, tourist attractions tickets, etc., commercial projects that most people only consume once in their lifetime. The role of excellent products is mainly to win reputation and import new traffic (traffic) and automatically enhance packaging (package) for new traffic. Despite this, for most commercial projects, repetitive consumption capacity still directly determines the development direction and life cycle of an enterprise.

Since repetitive consumption is so important, what determines it? In other words, as an entrepreneur, how can your business project have strong repetitive consumption power? There are two key factors: one is the natural attributes of a business project, and the other is the entrepreneur's design of the project.

The natural attributes of so-called repetitive consumption of commercial projects are determined by people's long-term behavioral habits and some historical traditions. For example, mobile games receive screen size restrictions. In addition to traditional games such as Doudizhu Chess and other games transplanted to mobile phone screens, the repetitive consumption capacity is generally much worse than that of computer games. Blizzard can eat with a World of Warcraft map and props for ten years, and Plants vs. Zombies are almost the limit of repetitive consumption of mobile games. The temple escape is out of date.

It should be noted that whether commercial projects naturally have the attribute of revisit is often extremely difficult to predict and analyze. As ordinary people, it is enough to just observe and compare. For example, the repetitive consumption capacity of cheese cakes is not as good as puffs, and the cisco shops in shopping malls basically cannot survive for a year, but octopus meatballs can flourish all year round. Even if you have been working in the catering industry for many years, it is difficult to judge in advance. But what we can know in advance is that their repetitive consumption capacity must not be as good as pancakes, ramen or ice cream, so the competition in the latter will inevitably be more intense.

When natural properties have been determined, whether the same commercial project can obtain higher repetitive consumption power depends on the entrepreneur's ability to design specific links of the commercial project. There are many internal interaction forces between TTPPRC, one of the interesting rules is that projects with weak repetitive consumption often have stronger traffic (traffic) and packaging (Pacakge) in the short term.

For example, in the face of the relatively poor revisit problem of creative dishes restaurants, Diaoye Beef Brisket has adopted the solution of changing menus every month for one small month. In order to retain the advantages of creative dishes vs. home-cooked dishes (traffic) and packaging (Pacakge), it has improved the ability to repetitive consumption. Although at present, Diaoye’s solution on this issue is not perfect, and we will discuss it in detail if there is a chance in the future.

Movies are typical products with relatively poor revisit consumption (Revisit). No matter how good the movies are, we usually go to the cinema to spend one or two times. However, Guo Jingming can make a movie like the young age into a long film, and work hard on traffic and packaging, and split it into four MVs. And from another perspective, the same story was first published in a magazine for several years, then merged into a book and published, then made into a series, and then made into a movie. It can be regarded as a fully tapping into the same group of consumers' repetitive consumption ability of a story, and it is worthy of being a top generation of profiteers.

There are countless examples of repetitive consumption capacity (Revisit) of products similar to the above products being developed by merchants. For example, I always think that the inability to replace the battery of a mobile phone is a huge conspiracy. The natural decline in lithium battery power will make consumers unable to bear it and buy a new mobile phone. After three years of use of the IBM laptop, I still walked steadily after changing the battery and hard drive (IBM lost a lot of money and finally acquired it... Samsung phones can change the battery, so it has its own attributes that stuck to you after using it for a long time); textbooks with the same content in American universities are reprinted every year, and in recent years, many bookmakers have simply attached a one-time online course activation code to each textbook; the coupons shared by Didi Taxi to Moments can be obtained, on the one hand, it imports traffic, and on the other hand, it also enhances the desire to consume again...

Looking back, Draw Something's rapid fall back then, perhaps its repetitive consumption (Revisit) is only part of the reason. Anyone who has played this game knows that as a mobile game, it did not have a system of points, upgrades, obtains props, unlocks new tasks and other basic addiction systems when it was at its highest traffic. So when it was played, it only saw the same words appear repeatedly, and naturally lost interest. The operation team has an unshirkable responsibility for the failure of this project. Moman and Face Cute, which also became popular on the circle of friends, have not had strong natural attributes of repetitive consumption, but the former's commercial creativity is obviously better. After introducing Alibaba's strategic investment, Moman Camera launched a series of derivative products and embarked on the international route. Recently, it is said that it will also sell customized versions of physical products. Unfortunately, it has missed the golden development period with huge traffic in the Chinese market.

In summary, the repetitive consumption capacity of a commercial project is mainly born. An excellent entrepreneur or investor must always remember this link. On the one hand, it is used to judge whether a project is worth doing, and on the other hand, it is to better design details to improve its repetitive consumption.

Cost

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I thought about the last link of TTPPRC for about a year and finally decided to put the cost here. Because compared with the previous five links, it seems to come from another dimension. As I mentioned in the foreword, the TTPPRC model comes from consumers' cognitive process of a business project, not based on the business operation logic of the merchant. To do any link in TTPPR well, it requires first-class execution and efficient management. But I finally realized that the essence of any business activity is for profit, and the source of profit for any project is based on the value of the service provided that can exceed its own costs (although more and more businesses in the Internet era seem to have shifted to the profit method of financing and listing and cashing out, this does not mean that capitalists will never care about gross profit margins). All business models that put aside costs are empty talk.

This is also the biggest misleading thing of the famous book "The Method of the Male of the Male", because he did not tell the losers that the most important issue that needs to be thought about when taking girls is the time and emotional cost of a person. Therefore, even if a man travels across the ocean one day to catch up with Liu Yifei, he is also a loser in my eyes. In addition to picking up girls in a man's life, there are too many important things worth doing. What's worse, if you truly understand the method of the Male of the Male of the Male, it will be difficult to have pure love.

In summary, the relationship between cost (Cost) and trend (Trend), traffic (Traffic), and packaging (Package) products (Product) is not in sequence, but is included in every link. There is no doubt that each link must be restricted by cost. For example, the core advantage of Weibo celebrities opening a Taobao store is that they do not need to spend a lot of money to buy direct bus Juhuasuan bidding rankings and orders, which not only saves a large amount of high traffic costs, but also saves the packaging costs of celebrity endorsements, so profits are naturally much easier. When the same product is placed in a grassroots Taobao store, if the boss does not have outstanding business skills and wants to obtain the same traffic and packaging, most of the profits will be contributed to Jack Ma.

Here we use a specific example to elaborate on the importance of cost to the first five links. It is my personal cake shop in Dalian High-tech Wanda Plaza - no second product is available.

The fanatical trend of cheese cake (Trend) probably came to the north at the end of 2013. Although in the long run, a cake-only shop is not a good trend, if you want to grasp the short-term trend of this bubble, the key is one word, fast. When I planned to do this project, I was already far behind my peers in terms of time. As a project without core technology, the cost of joining is much higher than that of making original brands. But in order not to waste valuable trends, I decided to join first. It only took more than a month from the first time I met the investment manager to the opening of the store, which is impossible to achieve in an original brand. Here you can see the analysis of trend costs.

The traffic volume of physical stores is mainly determined by the store rent. The direct traffic on the third floor of Dalian High-tech Wanda Plaza is quite poor, so the rent is not expensive. But later it turned out that because the mall is in the high-tech zone of Dalian, most of the young consumers, the effective traffic ratio of the target customers is relatively high, and other means such as group buying, the cost-effectiveness ratio is still possible. In contrast, many of my peers have won the store locations with more than three times the rent, but have not obtained the corresponding proportion of traffic that is sufficient to convert into sales. Instead, it closed early because of the high traffic cost.

The cost of packaging of cheese cakes mainly depends on the brand selection and store decoration design. Among the optional franchise brands on the market at that time, it was obviously not the most appealing one-time investment of millions per store. Compared with the VIs provided by Shi Si, Grandpa Ruike often requires a one-time investment of millions per store, the VI design and decoration style provided by Erpin is quite good, and the franchise fee is less than one-fifth, and the final packaging effect is still worth the franchise fee. However, the expensive equipment forced to purchase by the head office and the inflated decoration quotation are very poor.

The cost of a cake product mainly comes from the choice of raw materials. In addition to the goods that must be ordered from the headquarters as a franchisee according to the contract, the cost of other raw materials mainly depends on the role of these raw materials in the product experience. Specifically for a cake, cheese must be expensive, and milk can be selected with high cost performance. Of course, the catering industry is not only the manufacturing industry, but also the service industry, so labor costs are also important factors that need to be considered in part of the service link of the product experience. Due to the limited space, I will not go into details. In short, the experience I finally learned is that while ensuring the same service effect, the number of employees is streamlined and the salary exceeds the average level, rather than recruiting a few more people to provide average market treatment.

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From the above analysis process, we can see that cost analysis is permeated in every link of TTPPR, and it must be a process of continuous compromise and optimization. TTPPR without using cost as the basic analysis factor is meaningless. Considering costs does not mean being petty in every link, but the final solution must be to maximize profits. After all, a business that does not aim to make money is either a liar or a hooligan.

If you know TTPPRC, then what is its use?

Dear friend, if you read this with thoughts all the way, if nothing unexpected happens, at least half an hour has passed. During this precious hour, you must be constantly thinking, what is the use of seeing this?

Then I will tell you the answer now. Whether you have done business, studied business school, run a company, or only watched Korean dramas, listened to Mayday, read Zhang Jiajia, and TTPPRC are likely to be the best reading material you can find anywhere to understand all the complex and mysterious business phenomena of all sizes in the world in half an hour. If you can also write down the content represented by Trend, Traffic, Package, Product, Revisit, and Cost, and think about all business-related issues from now on, you can far exceed the average level of the people around you.

I said at the beginning that business is fascinating because it is the result of the combined effect of many complex factors. Although the threshold is low, it contains considerable uncertainty. Just like when playing chess, you need to memorize the chess score, you must first learn language, and stock trading requires a trading system. When you see order from disorder and find the rules in chaos, you will naturally begin to believe in strength rather than luck. I think this is the origin of the gap between people.

For example, you can easily know now that the reason why Hollywood actors’ income can be so high is that their works serve the global market and have huge traffic, while the entire income of small theater drama actors comes from tickets to audiences in small theaters, so they naturally don’t make much money.

Why can oil companies in a certain country make money every day? Because they can directly monopolize traffic. Standardized commodity business basically does not have packaging (Package) and product (Product) links. Revisit is naturally strong and has considerable pricing power, so there is no need to worry too much about cost.

The barbecue restaurant on the roadside can be opened for more than ten years, but the exquisite restaurants in the mall are updated very quickly because the repetitive consumption capacity of the skewers is particularly strong. The same is true for Holilai in recent years. After all, consumers' repetitive consumption of bread is far more than that of cakes.

Xu Jiayin's Evergrande Ice Spring is selling a mess. Experts say that its product positioning is not clear, but what does it mean? TTPPRC tells you that it means that consumers already know your product, that is, after the traffic level has been solved, there is no desire to consume, that is, there is a problem with the packaging (Package). Bottled water business is generally a business dominated by packaging, and normal people cannot distinguish the quality of the product. How to solve the packaging problem? Let's read Mr. Sally's "Famous" first, and see how many Evergrande Ice Spring occupies, and how many Evian has taken?

Look, do you think these problems that once seemed complicated have become much clearer in an instant?

Of course, just like "The Mysterious Method" cannot guarantee that you can catch girls, and TTPPRC cannot guarantee that you can make money. But it can provide you with a relatively clear idea. Whether you are starting a business by yourself or encountering related problems in work and life, help you break it down, break it down one by one, streamline it to six links, and quickly find a specific direction to solve the problem.

How to operate startups using TTPPRC

No matter how successful people brag about themselves, the core qualities of an excellent entrepreneur always include two points. The first step is to be able to reasonably disassemble some vague ideas into specific problems that need to be solved (TTRRPC). The second step is to find the best talents suitable for solving these problems to implement specific solutions.

For example, in my article "The distance between you and Escape from the O2O Death List is only a matter of understanding these 10 questions", no one has heard of many projects on the O2O Death List until they go bankrupt. If you have read TTPPRC, you must know that you don't have to analyze too much, and you will never have traffic.

So what should we do if there is a problem with traffic? It is obvious that users cannot keep up with the pace of Internet companies' development by relying solely on the quality of the product (Product) to obtain word of mouth. You already know that more traffic is needed, so where does the traffic come from?

An excellent entrepreneur must further refine this problem, so there are five cost-effective traffic acquisition methods (excluding ground push) mentioned in that article. The next step is to find the best talents to implement each method in detail and obtain quantifiable results.

1. Everyone loves 100,000+ tactics. Executor: Director of New Media

Investigate the common attributes of popular articles in recent circles of friends (article structure, narrative method, emotional appeal), write the company's products and services into stories with similar themes (inspiration, healing, funny), find excellent channels (Weibo large accounts, related fields KOLs, WeChat) to distribute, calculate the communication effect and backend growth.

2. The founder plays monkey tactics. Executor: Founder

Study the tone of public figures that audience users like and their common ways of exposure, talk about life in college speeches, be clever in entrepreneurship competitions, talk about feelings very well, and talk about old seniors on Weibo... Luo Yonghao's mobile phones are not very good, but if the same product is thrown to Nubia, I'm afraid it won't even be sold for a fraction of it.

3. Study media preference tactics. Executor: Founder + Director of New Media

This is actually the same as the first point, but the implementation idea is more specific. Look at 36 Kr, Huxiu, and Chuangyebang have been circulating "O2O Death List" recently, so why not give them a solution. "The Confusion of Our Generation" has received so many forwarding applications in a day. Can we integrate our products into similar articles? The Prime Minister vigorously calls for industrial upgrading, and even if I am a steelmaker, I have to write a transformation story to make up. Grasp the media's preferences, and you are the whole world.

4. Offline diversion tactics. Executor: Sales Director + Technical Director

Who said that O2O can only divert traffic online? The technical team explained the advantages of the product with the sales team. The sales director led the BD to talk one by one. If your product can provide convenience to merchants like Alipay, the merchant may also promote it for you. The community service official account on my mobile phone is recommended by the convenience store guy downstairs.

5. Elevator advertising tactics. Executive: Marketing Director + Design Director

The marketing director investigates the main activity locations of the target customers, counts the flow of people and corresponding indicators, selects the most suitable writing room, finds the corresponding elevator advertising supplier, sets the package and price, and selects the appropriate time to place the content produced by the design director according to the product development status.

The operating methods mentioned above are not necessarily correct, but they are an excellent entrepreneur’s idea of ​​solving problems, not complaining: What should I do if I don’t have users? You idiots, find users for me!

In summary, as a person with a chess and a late stage in obsessive-compulsive disorder, I have an almost crazy fascination with breaking down any project into one executable step, which is also the origin of the TTPPRC model. Only children are clamoring to change the world, and adults should care about how to execute it.

The biggest difference between business and chess is that every step of the former requires many excellent people to execute together. No matter how good I write my own jokes, I cannot make a living like Li Jiaoshou. I need to bring sales Tie Shun who can lead BD to shout slogans and do morning exercises, to bring 1024-like harmonious operation experts maintained by the user community, and to learn and play on Weibo and WeChat. I simplify powerful functions into product managers that my parents can understand together... Break down every link in TTPPRC one by one, and finally gather into a force that is difficult for competitors to reach.

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For those who can't, teach; for those who can, DO.