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As one of the few internet players still active in the used car industry, Guazi decided to take another risk in 2021.
According to the new plan of founder Yang Haoyong, Guazi changed the offline model of the original Yanxuan store and migrated the second-hand car transaction to online. Yang Haoyong said that this change will make melon seeds live longer, and he does not want a competitor to defeat melon seeds with this model in the future, so he decided to take the initiative to adjust.
Yang Haoyong's concerns are precedent-based. In the United States, an online used car trading platform called Carvana has more than twice the market value of Carmax, a used car retail company that focuses on the offline model. The former's share price has risen by more than 600% in the past three years, and the latest market value is $41.604 billion.
However, in this adjustment that can be said to be "broken", the challenges facing melon seeds are also huge.
Continuing according to the previous strict selection model, melon seeds are expected to achieve profitability this year. Now, along with business adjustments, employees need to adapt to new rhythms and ways of working. Secondly, the transformation of melon seeds into a pure e-commerce model means that it is necessary to persuade car dealers who were originally opposed to each other to enter the melon seed platform. Finally, whether consumers can accept pure online car purchase methods is also a new issue facing Melon Seeds.
This is a redistribution of interests and the resolution of contradictions with all parties involved in melon seeds.
"Talk to all the people above the senior director about the new model"
The industry has always held a high degree of recognition for the execution of the melon seed team.
From the beginning of its establishment, Yang Haoyong led this team to break into the second-hand car industry in a "high-minded" manner. During this period, they experienced a fierce advertising war, many model changes, business adjustments. Almost every adjustment, Yang Haoyong and the team endured many doubts, but in the end became the only one who survived.
Yang Haoyong has repeatedly told the visiting media, "The melon seed team is known to be able to fight hard battles. Looking at the entire Internet circle, the combat effectiveness of melon seeds is also in the forefront. ”
However, no matter how strong the execution, for any organization, frequent changes can have an impact on the team. Especially for Melon Seeds, deciding to transform at the moment when it is about to make a profit means that the team needs to take a new path. Business processes, performance appraisals, and organizational structures are all facing readjustment.
So, when an organization decides to transform, the first problem that needs to be solved is the "human heart."
"In order to make employees recognize the new direction, Haoyong will pull colleagues above the senior director level of the company to lunch almost every day before the model adjustment, and tell them what the new model is all about." A guazi insider told the titanium media App that not everyone recognized the transformation of the online road at that time, and Yang Haoyong persuaded one by one to make everyone believe that e-commerce is the future of second-hand cars.
In the training room on the second floor of Guazi, Yang Haoyong explained the new model to different teams in batches, one lecture for two or three hours, and each employee had heard it at least once. Yang Haoyong believes that only by unifying everyone's thinking and understanding what the underlying logic of this model is, can we proceed to the next step.
After that, the HR department of melon seeds also participated and went to various cities to preach. From management to front-line employees, several rounds of communication are made clear about what the company's strategic goals are.
At the same time, investors in melon seeds are also testing whether this pure online second-hand trading model can run through.
"One investor also specifically looked for someone in the United States to compare the user experience of Carvana and Carmax." According to the above-mentioned person, after the test, investors found that Carmax's trading model was more limited to the local, and Carvana's e-commerce model was the real sense of breaking the geographical restrictions, and its transaction efficiency was much higher than that of Carmax.
More importantly, the online model experience is better, and the trend of user flow to Carvana is becoming more and more obvious. Carvana's user satisfaction is 96% and NPS (Net Promoter Score) is 83 points.
In January, Guazi chose Tianjin to take the lead in the closed-loop test of the e-commerce model, and then expanded to 10 cities. After realizing the unification of the business model level and the employee ideological level, Guazi began to promote the e-commerce model to the whole country in May.
Under the new model, the employees of Guazi's previously strictly selected business were transferred to online sales, delivery, logistics, etc.; offline stores were demolished from large to small, becoming urban warehouses for offline performance.
In June, in the latest round of financing of 300 million US dollars, investors also chose to continue to follow up.
"Re-befriending car dealers"
Another challenge for melon seeds is from the outside — how to re-make friends with car dealers who were previously opposed to each other.
Before Melon Zi entered the second-hand car industry, the original trading model of this industry was basically "making money with poor information". Since used cars are typical non-standardized goods, the transparency of car conditions and the professionalism of consumers will greatly affect the selling price of the same car. For a long time, consumers' trust in used car dealers has been relatively low.
Based on such an industry background, as soon as the melon seed entered the market, it adopted a high-stakes marketing method, using the overwhelming "no middleman to earn the difference" advertisement, which quickly occupied the user's mind. This also means that the relationship between melon seeds and car dealers has since gone to the opposite side. Therefore, for a long time afterwards, melon seeds and car dealers competed in all aspects of the transaction.
For example, in the earliest C2C direct sales model of melon seeds, car dealers disguised themselves as individual users, or bought and sold a large number of high-quality car sources on the melon seed platform. In order to prevent this behavior, Melon Zi later launched an offline strict selection store, controlling the car source in his own hands, in order to fight back against the car dealer.
"Before the melon seeds came in, the car dealer could earn about 25% of the difference. After the melon seeds came in, the car dealer could only earn 6%-8% of the difference. That's why car dealers have always hated melon seeds. A melon employee told the Titanium Media App.
But now, with the transformation of Guazi into an online model, the number and richness of vehicle sources have become the key to the success of the platform. This also means that melon seeds need car dealers to join in and make the scale of car sources larger.
"It's relatively easy for us to switch on our own, and the bigger challenge comes from the more than 4,000 car dealers we've worked with before." Yang Haoyong once said that at the beginning, almost 80% of car dealers were unwilling to accept the platform's new rule of "7 days without reason to return the car". Therefore, Guazi can only arrange for the car dealer BP to persuade the car dealer again.
"The first is to talk about feelings, let them believe in us, and tell them about the long-term trend of e-commerce in the future." Yang Haoyong said that in fact, car dealers understand, they also want to do business. Originally, car dealers could only sell cars locally, but now Melon Seeds have the ability to help him sell cars to the whole country. Many car dealers who have followed melon seeds since the open platform 1.0 era have chosen to believe. They found that the return rate was acceptable and sales were climbing. As a result, little by little, the trust of the car dealer was regained.
At present, there are more than 6,000 car dealers on the guazi platform, and the sales volume of the melon seed platform has accounted for about 30% of the total sales of car dealers. Yang Haoyong believes that when more and more car dealers can earn more money on the platform, the contradiction between melon seeds and car dealers will naturally be resolved, and the road behind will become better and better.
"7 days no reason to return the car"
When the internal and external interests and contradictions are redistributed, the last link in the success of the melon seed online is whether consumers are willing to pay for it. In this regard, the countermeasure given by Guazi is - not satisfied, 7 days no reason to return the car. This is also what Melon Seed is good at, constantly breaking through the level of after-sales protection in the industry.
Since the beginning of this year, Guazi has restarted large-scale advertising, including implantation at talk show conferences and asking Luo Yonghao to endorse them. Users in subway stations, bus platforms, video websites, everywhere can see the "second-hand car new purchase method, try 7 days, not satisfied with the full refund" slogan.
Such brainwashing advertising, after blowing the horn of melon seeds to enter second-hand cars last time, also opened the door to the transformation of melon seeds e-commerce this time, so that consumers re-recognized melon seeds.
"You bring me the car, and then I drive for seven days. I said no, you better not ask me why, don't argue with me, I don't need to make up a reason, just don't want. We now offer such an option, for no reason. We have about 30% of the sales that users have returned and bought again, which is a good experience. Yang Haoyong told the Titanium Media App that this is the future consumer trend they bet on. Such an experience makes Guazi feel that it should be an endgame in this industry.
Yang Haoyong believes that in the next five or ten years, the main consumer group of second-hand cars will be 25 to 35 years old. When these post-95s and post-00s grow into the main group of used car consumers, they will say - why do I need to go to the used car market, shouldn't buying a used car should be like this (online)?
Now, after the melon seed switched to the e-commerce model, the latest buyer user NPS (Net Promoter Score) reached 43 points. That's a big gap from Carvana's 83 points, but the latter has been doing it for nearly 10 years. Both Gua Zi and Yang Haoyong are betting on a certain future, and the adventure begins well.
(This article was first published on the Titanium Media App, the author丨 technology refers to the north)