On November 9, Hello Travel announced that it had accepted a new round of financing of up to $280 million, and Alibaba participated for the first time. This is the latest round of financing since Hello Travel announced that it would abandon its listing in the United States.
As one of the few surviving platforms in the shared bicycle industry, its expansion at the business end is no longer limited to sharing bicycles, but has expanded the business of sharing motorcycles, hitchhiking, electric vehicles, hotels, train tickets, attraction tickets, delivery, car rental and other businesses, and has become a comprehensive living platform.
Shared travel is still the main business, and two rounds of sharing have been losing money for consecutive years
At the beginning of 2021, Haro Travel began the listing process, according to its prospectus, until 2020, sharing two wheels (that is, sharing bicycles, sharing motorcycles) still accounts for 90% of Halo Travel's revenue. From 2018 to 2020, Halo's revenue was 2.114 billion yuan, 4.823 billion yuan and 6.044 billion yuan, respectively, and gross profit was -1.147 billion yuan, 419 million yuan and 715 million yuan, respectively. The data shows:
Net loss of 2018 was RMB2.208 billion;
Net loss of 1.504 billion yuan in 2019;
Net loss in 2020 was RMB1.134 billion.
The business of sharing bicycles and sharing motorcycles is not easy to do.
Under the B2C thinking, the asset-heavy model of sharing bicycles naturally has certain disadvantages. According to public data, it can be inferred that a shared bicycle takes at least two years to recover the cost, and if depreciation, maintenance management and other expenses are added, the time to recover the cost will be longer.
The revenue of shared motorcycles is higher than that of bicycles, but the cost of recycling is also more than one and a half years. And also face hardware iteration, hardware damage and other costs.
How to make a profit has become a "sharing" problem in the shared bicycle and shared motorcycle industry.
Hello's mobility services, in addition to two-wheel shared services ("Hello Bikes", "Hello Motorcycles"), also have hitchhiking services ("Hello Rides").
According to Hello Travel's previous prospectus, in 2020, the total transaction amount (GTV) of Halo Travel was 13 billion yuan, the annual transaction users were 183 million, and the total number of transactions reached 5.2 billion. By the end of 2020, 34% of Hello users had used two or more of the company's services.
According to Hello Travel, the daily transaction volume of the Hello Ride-hailing platform has exceeded 100 million yuan. The data shows that Hello Hitchhiker has covered more than 300 cities across the country and certified more than 10 million car owners. At the same time, Hello has also launched a taxi business in Guangzhou, Chengdu and other cities.
Shared travel is restricted, from "sharing" to "selling"
After the rapid expansion of shared motorcycles in the past few years, as the government regulatory authorities' understanding of the industry has become clearer and clearer, the regulatory authorities have gradually clarified, and the corresponding control and access thresholds have also risen. Various local governments have introduced corresponding regulatory management measures, and in 2020, many cities have issued the "one helmet and one belt" policy, and in 2021, many cities have issued shared electric bicycle management measures, of which many cities "do not encourage the development of shared electric bicycles".
This has caused the shared tram industry to put on the brakes, and shared motorcycles have been forced to retire in many first-tier cities.
However, in the context of the policy of "carbon peaking and carbon neutrality", the electric vehicle industry, which represents green travel, is still promising.
According to iResearch data, China currently has 325 million electric bicycles, which is the world's largest electric bicycle market. With the implementation of the new national standard, China's electric bicycle market will transition from lead-acid batteries to lithium batteries, and the industry will enter a stage of rapid development, and the total sales of electric bicycles are expected to reach 258 million units in 2021-2025.
At the same time, according to the statistics of the Prospective Economic Research Institute, the market transaction scale in 2019 and 2020 was 85.1 billion yuan and 104.6 billion yuan respectively, with a growth rate of 19.9% and 22.9%. This humble means of transportation contains a large market worth hundreds of billions.
Rebuilding a calf electric car is facing many difficulties
In the face of a huge market cake, Halo Travel launched the "Hello Electric Vehicle" and cooperated with CATL and Ant Group to launch the "Xiaoha Replacement".
In 2020, Haro officially opened a copy of "car-making", released the VVSMART (abbreviation of "Vehicle Valuable Smart") hyper-connected car machine system suitable for two-wheeled electric vehicle products in April 2021, and launched the first three models equipped with this system, and has begun to lay out internal production capacity.
Hello and Tianjin Ninghe District Government have also reached a cooperation to build a "two-wheeled electric vehicle super factory" in Tianjin Tianning Industrial Park, with an estimated annual production capacity of 3 million vehicles. The story of heavy assets may be repeated in the electric vehicle business.
While continuing to expand its green mobility and local life service business, Hello Travel is developing towards a real economy oriented by intelligent manufacturing. In addition to accelerating the layout of products and production capacity, Halo Electric Vehicle has also developed sales channels with extremely high efficiency and speed.
As of March 31 this year, Hello Electric Vehicle has 1,400 franchise stores selling cars in 100 cities. In addition, the two-wheel power exchange model will usher in new market opportunities. Up to now, Xiaoha power exchange covers nearly 300 cities, with an average daily power exchange service of hundreds of thousands of times.
From the financial data of the head brand of electric vehicles Yadi and Emma, the profit margin of electric vehicles does exist, in 2020, Yadi's overall revenue is close to 20 billion yuan, net profit reached 957 million yuan, and Emma's total revenue was nearly 13 billion yuan and net profit was 610 million yuan in the same period.
But as of the end of 2020, Yadi has 17,000 stores and 3,000 dealers, and Emma has more than 30,000 stores, and it is not difficult to see that its huge profits are related to its sales outlets. Compared with the number of stores of old players, Hello Electric Vehicle is undoubtedly still in its infancy.
The just-started Hello electric vehicle, what to subvert the ecological pattern of existing players, how to make a profit, will still be a problem that Haro needs to consider.
We see that the model used by Hello Travel is to use traffic to lock users, and then divert traffic, such as the sales of electric vehicles, the above idea seems to be good, but the problem is that electric vehicle sales are a low-frequency scene after all, and the daily traffic support is a high-frequency scene, and the conversion between high frequencies and low frequencies, especially whether effective communication can be formed between profit guarantees, is actually the most core problem that plagues Hello Travel.
In the case of sharing bicycles and sharing motorcycles without making money, recreating a calf electric vehicle can save the decline in profitability and need to be verified by the market.
It is difficult to create a living platform for local services, and it is difficult to replicate the glory
Hello travel's shared bicycles, shared motorcycles continue to lose money, but its business boundaries are constantly expanding, hitchhiking, small Ha power exchange and other businesses have covered more than 300 cities across the country, of which shared bicycles and shared motorcycle business settled in more than 400 cities, when Hello's "travel territory" density is large enough, the emergence of local service business seems logical.
Recently, the Harrow Travel App launched a local life consumption portal, providing services including catering to the store, finance, maps, wine and tourism, etc. Subsequently, Hello has successively launched the errands business. The business of Hello Travel is concentrated in its independent APP, due to the lack of its own traffic, the life service business such as hotels and ticket bookings has not caused much waves.
Relying on the resources of the Ali system, Hello has made certain achievements in the shared bicycle industry, but its local life business is difficult to repeat the previous ideas. On the one hand, the Ali department has its own local life services, wine tourism has flying pigs, takeaway food has word of mouth, and Hello rushes in to grab traffic, which is not Ali's intention. As can be seen from the Alipay page, Ali guides Hello only the traffic of cycling.
Alibaba's strategic layout of the newly established life service sector on July 2, in which Ele.me and AutoNavi will become the main user entrances for local services "to home" and "to the destination" respectively, while Fliggy, as a tourism vertical service platform, will continue to be committed to organizing high-quality hotel, transportation and scenic service supply.
Prior to this, Fliggy focusing on the wine and tourism business has not been included in the territory of Ali's local life, this adjustment means that Ali has also formed a takeaway + wine tourism formation in the local life battlefield, according to the "2020 China Online Tourism Industry Market Competition Pattern Analysis" released by the Prospective Industry Research Institute, in 2019, in the ranking of China's online travel manufacturers' transaction scale index, Fliggy ranked third second only to Ctrip and Qunar, and was relatively leading in the OTA market.
However, as a fourth-party platform, AutoNavi has integrated multiple life service brands, and Ali already has corresponding business lines in local life, which can provide limited traffic support for Hello. The script of Alipay and shared bicycles complementing each other is difficult to reproduce.
The "Hello" hotel has begun to take shape, positioning users in the sinking market
In the business map of local life services, the most eye-catching is the "Hello Hotel".
According to the official information, Hello Hotel has signed hundreds of franchise stores, covering more than 20 cities such as Guangzhou, Hefei, Wuhan, Nanjing and Chengdu. From traveling to hotels, Hello Travel's performance on this track has naturally aroused a lot of attention from the outside world.
From the current officially announced business form, it is mainly for small and medium-sized independent hotels. In addition to the unified change to "Hello Hotel" in terms of brand, Hello Hotel will take traffic empowerment, operation empowerment, and revenue management optimization as the starting point to achieve cost reduction and revenue increase for independent hotels. After the hotel joins, Hello will provide one-on-one professional guidance to help the hotel optimize the front-end display from the aspects of OTA platform optimization and channel development, and adjust the operation strategy in a timely manner through changes in business circle traffic data.
Hello Hotel adopts a light franchise model similar to OYO Hotel, with two forms, one is cash franchise, that is, paying 9888 yuan of brand usage fees per year, and 5000 yuan of service deposit, and the other is the "cash + replacement room" model. Compared with the operating costs of hotel chains, Hello Light Hotel is more cost-effective in a short period of time and has lower operational risks.
According to the relevant data released by the official, after the professional guidance of the operation team, the individual customer orders of a franchise store in Sichuan increased by 37% after 23 days compared with before the adjustment, the number of OTA clicks increased by 35%, and the average quality score of OTA services increased by 17%. Therefore, it is not difficult to see that Hello is really trying to incorporate individual hotels into this system and form a hotel chain group.
In fact, this franchise model is obviously a relatively lower-cost way to enter the hotel industry for Haro Travel, after all, compared with the huge investment in self-built hotels, there is also a greater risk for the situation that it is not yet profitable. At this stage, independent hotels are an extremely fragmented, relatively blue ocean market. According to the "China Hotel Industry Report", there are about 920,000 independent hotels in the domestic hotel stock market, accounting for more than 85%, and the market size that can be reached is close to 1 trillion. Although OYO's development in the domestic market has not been very satisfactory before, Hello clearly sees this market with great potential.
But it has also officially had OYO's attempts in this field, which undoubtedly gives Hello Hotel valuable experience. Previously, Yang Lei, CEO of Hello Travel, revealed that "most of Hello's users are ordinary people in the sinking market, based on such a user base, Halo hopes to do low-end hotels." In the case that such hotels have not yet established unified standards for service standards and operations, it will obviously bring them more room for development.
For Hello, which now has 400 million users, it seems to have shown the advantages of a traffic platform, in order to divert users from the new hotel business is obviously or just a way to monetize. But now in the field of hotel chains, according to the "2019 China Hotel Chain Development and Investment Report" released by Yingdi Consulting, as early as 2019, among the top 10 hotels in China's hotel chain brand scale, there were 553 all-season hotels with the lowest number of stores, while the number of stores in the 7-day hotel was the largest, reaching 2283, and the number of rooms in HomeInn hotel rooms reached 233226. Therefore, this also means that Haro Hotel wants to make a rapid breakthrough in this field, and there is still a long way to go.
In fact, independent hotels also face many unresolved pain points, and due to problems such as popularity, such hotels are also easy to be "kidnapped" by OTAs. It was revealed that OYO had paid 200 million yuan and 400 million yuan in channel fees to Ctrip and Meituan respectively, and at the same time paid a certain commission to reach transactions on the corresponding platforms. But in contrast, Hello Travel itself is a traffic channel, but at this stage, user habits still need to be cultivated for a certain period of time.
Therefore, at this stage, for Hello Travel, when the hotel business is just starting, how to complete the cold start, and import the traffic of the platform into this business, and cultivate the user's usage habits may be an urgent problem to be solved. As for whether this business line can expand its mobility business and complement its layout in local life services, it remains to be answered.