To be honest, Taobao's profit margin isn't actually that high; the real money-makers are Alipay, that incredible tool. Alipay's online payment function can attract a massive amount of funds, and with the rise of smartphones, this will become a continuous pool of capital. The daily service fees alone will be astronomical.
Moreover, Taobao is a real mixed bag, with most of the products sold being either made by small workshops or outright counterfeit goods. Its only appeal is its incredibly cheap prices, attracting a large customer base. Once JD.com's reputation and Pinduoduo's emergence take hold, Taobao's demise will essentially be sealed.
In other words, they seized the market early and took the initiative. If it comes to selling reputation and service, they absolutely cannot beat JD.com, nor can they beat Pinduoduo in terms of price.
While Pinduoduo's products offer little guarantee, they capitalize on group-buying periods, allowing them to outcompete Taobao on pricing.
To improve delivery efficiency, Pinduoduo has also established its own logistics team and invested billions of yuan to build smart warehousing centers across the country to solve the last-mile problem.
Unlike traditional e-commerce platforms, Pinduoduo has no entry fees or advertising; instead, it relies on social networks for promotion.
It directly saves merchants on store opening and operating costs. All they need to do is upload pictures and ask for a price to complete a transaction. It couldn't be more convenient; anyone could do it.
Moreover, Chen Fang has already instructed Zhang Xiaolong to begin preparing for the development of WeChat. Once WeChat is released, with the cooperation of China Unicom and China Mobile, they will capture the domestic chat user base. This will be a challenge for Taobao, Pinduoduo, and JD.com.
“If it weren’t for the fact that Pony Ma and his team found it too troublesome, I would have liked to start my own e-commerce platform.”
"Too much trouble?"
Shen Fang smiled and said, "That's right. They find it troublesome. Now Q coins are like a money printing machine, printing money everywhere. The consumer group is huge, especially during the Spring Festival. Everyone has more money in their pockets, and kids have more pocket money. The number of people recharging has surged. Now they have a discounted annual fee service, and many people have opened Penguin Membership, Red Diamond, Blue Diamond and other paid services. They are now focused on games and e-commerce because they think it is too troublesome."
Xu Xin laughed upon hearing this: "Mr. Ma and his team are really obsessed with money. But I can understand. It's a zero-cost product. The more you print, the more money you make. It's completely virtualized. It's just a string of code. Even if you're building an online sales platform, you'll still face many problems and need a huge operations team. Tencent is preparing to go public this year. If they can generate more revenue, it will greatly help with the IPO."
Shen Fang nodded: "What did your former employer say?"
"Zhuang Sheng has already started to help the tycoons in Hong Kong's financial district. As soon as Tencent is listed in Hong Kong, they will buy up shares on the first day of trading."
"It's a bargain for the big players. They can buy up a lot of stock as soon as the market opens, and holding onto it is like a gold mine that never ends."
...One was her former boss, and the other was her current boss, so she couldn't interrupt and had to change the subject.
"Mr. Shen, I think e-commerce is an untapped gold mine. Even if Pony Ma doesn't do it now, he will in the future. We can't let it pass us by. I've met with Lu Yun before, and his idea makes a lot of sense. Creating an online shopping platform that allows users to sit at home, place orders online, and buy what they want, achieving the goal of having goods delivered to their door without leaving home, and getting the goods they want in the shortest possible time, is truly a groundbreaking idea. It's so convenient."
Shen Fang shook his neck: "Let's wait a bit longer, I have a plan in mind."
If they do it now, they'll just be waiting for Lu Yun to copy them. Once Lu Yun's Taobao is established and Tencent has money from its IPO, they can start their own online shopping platform. With Taobao's template, imitating it won't be a problem. Tencent can only copy others; others can't copy Tencent. They can only get something for free. I wonder how Lu Yun will feel when he sees Tencent copying him.
"Mr. Shen, there's something else I'd like to ask you. Isn't it a bit too risky to have Mr. Wang invest heavily in gold? Although I'm quite optimistic about gold futures, with the continuous sharp declines over the years, if you try to buy at the bottom now, you could suffer heavy losses if you don't reach the bottom yet."
"Sister Xin, do you know what the price of gold is right now? It's 70 yuan per gram, isn't that ridiculous? Gold has always been a very scarce precious metal. When have we ever been short of gold? And Chinese people are particularly obsessed with gold. For Chinese women who love to grab bargains, go to the store now and you'll see that the gold shops are basically packed every day, and they can't keep up with demand. If it were silver, I might consider the risk, but at this price of gold, it's basically like picking up money. I'm not heavily investing now, but I'm waiting for the right time to invest heavily."
"Moreover, China's industry is developing rapidly. Many sectors, such as electronics, aerospace, and chemicals, use gold. Now that China has joined the WTO, its economy is poised for rapid growth."
Integrating into the global industrial chain will undoubtedly make China the world's factory, simultaneously lowering international industrial product prices. Meanwhile, major domestic investments in infrastructure and other areas will boost demand for commodities. Coupled with the quantitative easing policies of the US and China, a rise in gold prices is foreseeable, and I predict at least five consecutive years of increases.
Xu Xin nodded.
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