The essence of Internet thinking summarized: 1. User thinking; 2. Minimalist thinking; 3. Extreme thinking; 4. Iterative thinking; 5. Traffic thinking; 6. Social thinking; 7. Big data thinking; 8. Platform thinking; 9. Crossover thinking.

　Pre-class show: three anecdotes

The first anecdote: A person with no restaurant industry experience opened a restaurant, and in just two months, it achieved the highest sales per square foot among the restaurants in the shopping mall. VC invested 60 million yuan, and the valuation reached 400 million yuan. This restaurant is Diaoye Niunan.

It has only 12 dishes, and spent 5 million yuan to buy the beef brisket recipe from Hong Kong's "food god" Dai Long. Every pair of chopsticks is custom-made and brand new, and can be taken home after the meal. The boss spends a lot of time every day staring at complaints about the dishes and service. Before opening, it burned 10 million yuan on six months of closed beta testing, during which it invited various celebrities, influencers, and big Weibo accounts to try the food for free...

Why did Diaoye Niunan arrange things this way? What is the logic behind it?

Now let's look at the second anecdote: This is an online brand. It launched on Tmall in June 2012, and after 65 days it became China's No.1 online nut seller. During "Double 11" in 2012, it created a miracle of daily sales of 7.66 million yuan, ranking first in China's e-commerce food category. In January 2013, monthly sales exceeded 22 million yuan. In more than a year since then, cumulative sales have exceeded 100 million yuan, and it again received $6 million in investment from IDG. This brand is Three Squirrels.

Three Squirrels' package includes a parcel with the brand's cartoon image, a box opener, courier messages, nut packaging bags, sealing clips, trash bags, a micro-magazine conveying brand philosophy, cartoon keychains, and wet wipes.

Why would an online brand go to such trouble to do all this?

Now the third anecdote: This is a company founded only three years ago. In 2011, sales were 500 million yuan; in 2012, sales reached 12.6 billion yuan; in the first half of 2013, sales reached 13.27 billion yuan, and full-year sales are expected to exceed 30 billion yuan. In a new round of financing, its valuation reached $10 billion, ranking fourth among domestic Internet companies.

This company is Xiaomi. Lei Jun said that the sense of participation is the biggest secret of Xiaomi's success. How should we understand "sense of participation"?

These three companies belong to different industries, but they are strikingly similar. We all call them Internet brands.

What exactly is the Internet thinking behind them?

The "Dugu Nine Swords" of Internet thinking

I have defined Internet thinking as: under the continuous development of technologies such as the (mobile) Internet, big data, and cloud computing, a way of thinking that re-examines the market, users, products, the enterprise value chain, and even the entire business ecosystem.

"Dugu Nine Swords" is the martial arts masterpiece of Feng Qingyang of the Sword Sect of Huashan. It emphasizes "no move beats a move" and focuses on sword intent, which has the same effect as Internet thinking. It also means that Internet thinking, just like Dugu Nine Swords defeating all martial arts schools in the world, will reshape and subvert various traditional industries.

Let me talk about the Internet thinking system as I understand it.

1. User thinking

The first move of Dugu Nine Swords is the General Formula. If you cannot learn the first move, it will be difficult to comprehend the later moves. The same is true for Internet thinking. The first and most important aspect of Internet thinking is user thinking. User thinking means considering problems "user-centered" in every link of the value chain.

As a manufacturer, you must establish a "user-centered" corporate culture throughout every link of the value chain. Only by deeply understanding users can you survive. Without recognition, there is no contract.

There are several laws here:

Law 1: Those who win the "diaosi" win the world.

Successful Internet products mostly capture the needs of the "diaosi group" and the "grassroots generation." This is an era when everyone calls himself "diaosi" but deep down believes he is a "tall, rich, handsome man" or a "white, rich, beautiful woman." If your product cannot make users part of the product and cannot connect with them, your product is bound to fail. QQ, Baidu, Taobao, WeChat, YY, and Xiaomi all built their dominance by riding on the "diaosi."

Law 2: Sell a sense of participation.

One situation is made-to-order: manufacturers provide products that meet users' personalized needs, such as Haier's customized refrigerators. Another situation is optimizing products through user participation, such as the online brand "Qigege." Every time a new product is launched, the designed styles are placed in the fan groups they manage for fans to vote. These fans determine the final trend, and naturally they will also pay for these products.

Letting users participate in brand communication is the fan economy. Our brand needs fans, not just users, because users are far less loyal than fans. Fans are the highest-quality target consumers. Once emotional factors are injected, even defective products will be accepted. In the future, brands without fans will all die out.

The movie "Tiny Times" scored less than 5 on Douban, but the average age of its audience is only 22. These fans are precisely Guo Jingming's rich mine. It is precisely because of a large number of fans "**" that "Tiny Times 1" and "Tiny Times 2" created a box office myth totaling more than 700 million yuan.

Law 3: Experience comes first.

A good user experience should start from details and run through every detail. It must be perceptible to users, exceed their expectations, and bring them surprise, spanning the entire chain of brand-consumer communication. In short, it means keeping consumers feeling great all along. The folding of official accounts in the new version of WeChat is a typical example of the "user experience first" choice.

The user thinking system covers the most classic Who-What-How model of brand marketing. Who: target consumers — the "diaosi." What: consumer needs — selling a sense of participation. How: how to achieve it — putting user experience first throughout the entire process.

2. Minimalist thinking

In the Internet age, information **, and users' patience is increasingly insufficient. So you must capture them in a short time!

Law 4: Focus; less is more.

Apple is a typical example. In 1997, Apple was close to bankruptcy. When Jobs returned, he cut 70% of the product lines and focused on developing 4 products, turning Apple from loss to profit and back from the brink. Even by the 5S, the iPhone had only 5 models.

Brand positioning also requires focus. Give consumers one reason to choose you; one is enough.

A recently very popular online flower brand, RoseOnly, positions itself for the high-end crowd. Buyers must bind their ID number with the recipient's ID number, and each person can only bind once, meaning "love only one person in a lifetime." It launched in February 2013, and by August it achieved monthly sales of nearly 10 million yuan.

The greatest truth is simple. The simpler something is, the easier it is to spread and the harder it is to do. Only with focus can you have strength, and only then can you achieve the ultimate. Especially in the entrepreneurial period, if you cannot focus, there is no possibility of survival.

Law 5: Simplicity is beauty.

In product design, you need to do subtraction. The appearance should be concise, and the internal operation flow should be simplified. The Google homepage is always a clean interface; Apple's appearance and Tesla's car appearance are all such designs.

3. Extreme thinking

Extreme thinking is to make products, services, and user experience extremely good, surpassing user expectations. What does "extreme" mean? Extreme means putting your life into it.

Law 6: Create products that make users scream.

Use extreme thinking to create ultimate products. There are three methodologies: first, "grasp needs accurately" (pain points, itch points, or excitement points); second, "push yourself hard" (to the limit of your abilities); third, "manage tightly" (those who have product managers win the world). All industries are media. In this social media era, good products will naturally spread by word of mouth.

Screaming means the product must be taken to the extreme; extreme means surpassing user imagination!

Law 7: Service is marketing.

Afu Essential Oil is a well-known Taobao brand. Two small details show its extreme pursuit of service experience: 1) Customer service works in shifts 24 hours a day, using ThinkPad laptops with the red TrackPoint, because switching windows on this computer is more convenient, allowing consumers to wait a few seconds less; 2) There is a "CSO," namely Chief Surprise Officer, who every day looks for potential promoters or experts among user messages. After finding them, they send a package to create a surprise for this possible "opinion leader."

Haidilao's service philosophy is highly praised by many people. But under the wave of Internet thinking sweeping across the entire traditional industry, if Haidilao cannot restructure the enterprise with Internet thinking, then the one that fails to learn may be Haidilao itself.

4. Iterative thinking

"Agile development" is a typical methodology for Internet product development. It is a development method centered on people, iterative, and incremental, allowing shortcomings and constant trial and error, improving products through continuous iteration.

There are two points here: one is "micro," the other is "fast."

Law 8: Focus on small things and make micro-innovations.

"Micro" means starting from subtle user needs, being close to user psychology, and gradually improving through user participation and feedback. "You may think it is an insignificant point, but users may find it very important." 360 Security Guard was only a security protection product back then, and later it became an emerging Internet giant.

Law 9: Lean startup, fast iteration.

"Among all martial arts in the world, only speed wins." Only by responding quickly to consumer needs can products more easily stay close to consumers. Zynga updates its games several times a week, Xiaomi's MIUI system insists on weekly iteration, and even Diaoye Niunan's menu is updated monthly.

For traditional enterprises, iterative thinking here focuses more on awareness of iteration, meaning we must pay timely or even real-time attention to consumer needs and grasp changes in consumer needs.

5. Traffic thinking

Traffic means volume, and volume means weight. "Where attention gathers, money will follow." Traffic is money, traffic is the entrance. The value of traffic needs no further explanation.

Law 10: Free is for better charging.

Most Internet products use free strategies to vigorously attract and lock in users. Back then, 360 Security Guard invaded the antivirus market with free antivirus software, stirring things up. Looking back now, Kaspersky, Rising, and other antivirus software are probably no longer installed on many computers.

"Free is the most expensive" — not every business can choose a free strategy; it depends on the product, resources, and timing.

Rule 11: Persist until the "critical point" of qualitative change

For any Internet product, once the number of active users reaches a certain level, a qualitative change begins to occur, bringing business opportunities or value. If QQ had not persisted back then, it would not have the corporate empire it has today. In the attention economy era, you must first grow your traffic before you have the chance to think about what comes next; otherwise, you won't even have a chance to survive.

6. Social thinking

The core of social business is the network. The customers a company faces exist in the form of a network, which will change the entire shape of the enterprise's production, sales, marketing, and other operations.

Rule 12: Make good use of social media

There is a smartwatch brand that, through 10 WeChat posts, nearly 100 WeChat group discussions, and over 3,000 reposts, sold 18,698 T-Watch smartwatches through pre-orders in 11 hours, with an order value of over 9 million yuan.

This is the charm of social marketing on WeChat Moments. One thing to remember: word-of-mouth marketing is not talking to yourself; it must always stand from the user's perspective and communicate with users in the user's way.

Rule 13: Crowdsourcing collaboration

Crowdsourcing is an Internet collaboration model centered on "swarm intelligence" and hierarchical architecture. Wikipedia is a typical crowdsourced product. Traditional enterprises should think about how to use outside brains, and without recruiting, "bring all the world's talent into their fold."

InnoCentive, founded in 2001, has become an important R&D supply-and-demand network platform in the chemistry and biology fields. The company introduced the "Innovation Center" model, increasing the proportion of external innovation from the original 15% to 50%, and improving R&D capability by 60%.

Xiaomi's deep involvement of users in its R&D process is also a form of crowdsourcing.

7. Big data thinking

Big data thinking refers to the understanding of big data and the comprehension of corporate assets and key competitive factors.

Rule 14: Small businesses also need big data

Users generally generate data at three levels on the Internet: information, behavior, and relationships. The accumulation of this data helps enterprises make predictions and decisions. Everything can be datafied. Enterprises must build their own big data platforms — small businesses need big data too.

Rule 15: Your users are everyone

In the era of the Internet and big data, corporate marketing strategies should target individual users with precision marketing.

After Intime.com went online, it connected offline physical stores with online member accounts and deployed free Wi-Fi in department stores and shopping malls. When a registered guest enters a physical store and their phone connects to the Wi-Fi, all their interaction records with Intime are displayed one by one in the backend. Intime can then determine the consumer's shopping preferences. The ultimate goal of this is to achieve visibility of products and inventory, as well as communication with users.

8. Platform thinking

Internet platform thinking is thinking of openness, sharing, and win-win outcomes. Platform models are the most likely to produce industry giants. Among the world's largest 100 companies, 60 derive their main revenue from platform business models, including Apple, Google, and others.

Rule 16: Build a multi-party win-win ecosystem

The essence of the platform model lies in building an ecosystem where multiple parties achieve win-win mutual benefit.

Future platform competition will certainly be competition between ecosystems. Baidu, Alibaba, and Tencent — the three major Internet giants — have each built powerful industrial ecosystems around search, e-commerce, and social networking, so later entrants like 360 find it very difficult to shake them.

Rule 17: Make good use of existing platforms

When you do not have the strength to build an ecosystem-type platform, you need to think about how to leverage existing platforms.

Jack Ma said: "If I were a post-90s generation starting a business again, with an Alibaba and a Tencent ahead of me, I would not challenge them. I can't have too big an ambition."

Rule 18: Make the enterprise a platform for employees

The organizational transformations of Internet giants all revolve around how to build internal "platform-type organizations."

This includes Alibaba's split into 25 business units and Tencent's adjustment into 6 business groups, all aimed at leveraging the platform effect of internal organizations. Haier divided more than 80,000 people into 2,000 self-managed business units, turning employees into true "entrepreneurs" and making everyone their own CEO.

Internal platformization means becoming a self-organizing rather than an externally organized entity. An externally organized entity always takes orders from others; a self-organizing entity innovates on its own.

9. Cross-border thinking

With the development of the Internet and new technologies, the boundaries of many industries have become blurred. The reach of Internet companies has penetrated everywhere, including retail, books, finance, telecommunications, entertainment, transportation, media, and so on.

Rule 19: Command the market with "users"

Why are these Internet companies able to participate in and even win cross-border competition? The answer is: users!

On the one hand, they hold user data; on the other hand, they possess user thinking. Naturally, they can command the market with "users." Alibaba and Tencent have successively applied for banking licenses, and Xiaomi has made phones and TVs — all based on this principle.

The next decade is an era of large-scale disruption in China's business sector. Once users' lifestyles undergo fundamental changes, enterprises that fail to transform in time will surely encounter their doom!

Therefore, the final rule: use Internet thinking to boldly engage in disruptive innovation.

A truly remarkable person is surely a cross-disciplinary person, able to find their coordinates at the intersection of technology and humanity. A truly formidable enterprise is definitely an organization that holds user and data resources and dares to innovate across boundaries.

Robin Li pointed out: "The biggest opportunity for the Internet industry lies in leveraging its own network advantages, technology advantages, and management advantages to upgrade and transform traditional offline industries, change the original pace of industrial development, and establish new rules of the game."

The above is my summary of Internet thinking — the "Nine Swords of Solitude."

Today, to judge whether an industry has potential, just look at how far it is from the Internet. Only enterprises that can truly reconstruct themselves with Internet thinking can truly win the future.

Cai Wensheng of Meitu Xiuxiu said: The future belongs to those who understand the Internet within traditional industries, not those who understand the Internet but do not understand traditional industries.

Fu Sheng of Kingsoft Network said: Industry opportunities belong to Internet people who dare to use the Internet to attack traditional industries.

We believe that the future certainly belongs to those who deeply understand the essence of traditional business and also possess Internet thinking. Whether you come from a traditional industry or the Internet field, the future definitely belongs to such O2O "amphibious talents."