The Conjecture of the "Electrical Shock" Prospect of Small and Medium Enterprises

“With the arrival of the Internet era, electronic networks are constantly changing the traditional business model, which presents challenges and opportunities for SMEs.” Boao Forum for Asia, held in Boao, Hainan, from January 16 to 18, 2013 At the SME Development Forum, participating experts believed that the new business model is testing small and medium-sized enterprises. Enterprises should seize the wave of the Internet, achieve online and offline integration, promote enterprise transformation and win broad network business opportunities.

E-commerce replaces retail sales? Internet impact traditional business model

In the 21st century, e-commerce, which integrates modern information technology, has become the most active force in the world economy. It has shown strong vitality and rapid growth during the world economy's continuous setbacks.

According to statistics, the amount of global e-commerce transactions reached 26.8 trillion U.S. dollars in 2011, an increase of 42 times in 10 years. In 2000, China’s e-commerce was only just starting. By 2006, the scale of e-commerce transactions had reached a trillion-dollar step. The scale of transactions in 2011 was close to 6 trillion yuan, accounting for 13% of GDP.

Li Jinqi, Director of the Department of Electronic Commerce and Information Technology of the Ministry of Commerce, said at the sub-forum: “The rapid development of e-commerce in China has penetrated into all areas of social life, promoted the establishment of a modern market system, and effectively supported the modern service industry. With the development of e-commerce, a number of emerging service industries have emerged, and online consumption is becoming an important way to expand consumer demand.The deep integration of e-commerce and the real economy is having a profound impact on people’s production, consumption and life. It will also promote the important force for the transformation and upgrading of the national economy."

The senior education director of the Cheung Kong Graduate School of Business, Hongwei Wang, said that the formation of globalization started in large part due to the first commercialization of the Internet on April 29, 1994. He believes that "after 1994, the emergence of the Internet has wiped out the boundaries of business."

Earlier, at the 2012 CCTV China Economic Year Awards Ceremony, Ma Yun, Chairman of Alibaba's Board of Directors, and Wang Jianlin, Chairman of Wanda, were the winners. After 10 years, e-commerce companies could set up a half million yuan stake in the retail market.

"I must say that e-commerce will win." Ma's point of view is simple and direct. He pointed out that although e-commerce cannot completely replace the retail industry, it will also "substantially replace."

challenge? New Business Model Tests SMEs

The rise of e-commerce has brought about new business models. Open, transparent information has led to the continuous weakening of monopolistic price advantages, and people's constant “online” shopping habits have caused “traditional offline” traditional businesses to lose a great deal of purchasing power. It has been asserted that shopping malls will become customer experience stores in the future, and consumption will shift to a highly comparable network.

Ge Jingdong, general manager of Sina's marketing department, business channel and local station business department, said that the rise of mobile terminals and social networks has led to great changes in consumer spending behavior. He said that users had previously known products through advertising and public relations campaigns, and during the period of social networking and mobile networks, consumption patterns became clearer. Everyone may obtain product information by knowing what a friend bought or how his friend's reputation for a product is.

Ge Jingdong said that social networking allows individuals to immediately become a sharer at the same time of purchase and experience. His sharing will affect the next consumer. When consumers undergo reforms in consumer behavior, what our business brings is that today's investment in the brand's hard-working brands may be destroyed overnight by a microblogging.

A guest at the forum expressed his own difficulties in e-commerce but it was difficult to achieve results. He has two gold jewellery factories in Shenzhen and a jewellery mall in Chengdu. Now he wants to do e-commerce and builds a platform. However, he discovered that it is not simply “electric shock” that he will be able to obtain new business opportunities. The e-commerce platform is difficult to see profitable.” Basically, the money earned each month is not enough for advertising expenses," he said.

Li Bing, president of Beijing Calyon Technology Co., Ltd., said that today, under the impact of the Internet, for small and medium-sized enterprises, "no innovation is waiting for death, innovation is not good for death."

opportunity! Seize Business Opportunities to Create an "Online, Offline," Convergence Model

According to the China Internet Information Center survey, 25.3% of SMEs interviewed last year had conducted online marketing activities in the past year, 26.5% of the surveyed enterprises had online purchasing activities in the past year, and e-commerce shaped numerous networks. The brand helps small and medium-sized enterprises from China to create a transformation and upgrade in China. The rapid spread of e-commerce and good interactivity make the outstanding products of small and medium-sized enterprises stand out.

The combination of online and offline has become an important channel to seize the Internet business opportunities. Li Bing believes that the emergence of O2O and B2B2C models is all about the integration of online and offline companies. He said: "So how to integrate? In fact, it is still necessary to build a trustworthy platform. People in the online shopping or consumption, will certainly look at quality and word of mouth, which means they will tend to more honest platform of the network platform."

Ge Jingdong believes that online and offline integration has brought new business opportunities to social media. For example, he said that there are 9,000 resellers on Sina Weibo, and they can publish their quotes on Weibo's content, and can conduct repairs, receive consultations, answer questions, and so on. The opportunity brought by the development of social networking to SMEs is that the original SMEs had to open the market, and the most important thing was the lack of funds, that is, the difficulty of loans. Now that we have microblogging, we have an online shop, which can go through its own Operating social marketing means winning a word of mouth to win business.

The merged "offline" services also require new integration to complement "online." Li Bing believes that the integration of offline services must be suitable for the enterprise itself and must be clearly studied in the early stage. For small businesses, it is not recommended to be big and complete, but to have a stable customer base. He said: "SMEs must seize the two points, seize the customer base, and then do the positioning of the customer base."