Video Editor

Chapter 2638 Consumer Closed Loop

After the first batch of flagship stores of Tianchao Internet Cafe opened, Suning asked its team to summarize and report the operating data of each store on the opening day.

When Zhuangzhuang received the data, she thought she had misread it and checked it three times before daring to send it to Suning's desk.

On the opening day of the flagship store in Zhongguancun, Beijing, the line of people stretched from the second-floor staircase all the way to the street.

Security guards had to set up barriers at the entrance to let people in in batches of fifty, with a few coming out and a few more coming in from outside.

However, to provide the best service, waiting customers can also order food, and there are also complimentary fruits and snacks.

Keep in mind that this was at the end of 1999. Such thoughtful service was unique and immediately created a strong bond with customers.

The computer booths at the Shenzhen Dongmen store were always occupied from 8 a.m. to 2 a.m. the next day.

When the network administrator handed over his shift, the handover sheet was filled with the mobile phone numbers of the customers waiting in line.

Some customers even waited for two hours without getting a turn, so they simply ate a meal in the downstairs dining area and came back to continue waiting.

Moreover, the food in the dining area is not perfunctory; it is prepared with very high-level culinary skills.

The Nanjing Road branch in Shanghai was even more exaggerated. In the first three days after its opening, the daily customer flow exceeded 10,000. The chefs in the catering area were busy from morning to night, and the fire on the stove never went out.

One chef was so exhausted that he fell asleep on a bench in the locker room without even changing out of his work clothes when he finished get off work.

But Suning sees these figures as just the beginning.

The internet cafe I want is not just a place to surf the internet, but a place where young people can stay all day without getting bored, an offline consumption scene that can cultivate brand loyalty.

What is a traditional internet cafe?

The dark room contained dozens of computers, and the air was filled with the smells of smoke and instant noodles. Guests could do nothing but surf the internet; once they were done, they would leave and probably never come back.

Internet cafes in China cannot follow this path.

Suning wants young people to treat this place as their second home, a place with food, drinks, entertainment, and friends, even more interesting than home.

……

After the first batch of flagship stores opened, Suning held several rounds of debriefing meetings with the design and operations teams.

Every time they have a meeting, they add new things to the internet cafe's functional areas on the whiteboard. At first, the operations team diligently took notes in their notebooks, but later they found they couldn't keep up because Suning added a bunch of new projects every time they had a meeting.

The food court initially only served simple boxed meals and drinks, such as a braised chicken leg rice and a Coke, much like a university cafeteria.

Suning said it wasn't enough; they wanted to offer full-service meals, hire professional chefs, change the menu every quarter, and include Sichuan, Cantonese, and Northeastern cuisines. Stores in different cities would adjust the proportion of different cuisines according to local tastes.

The executives were all sweating profusely, trying to remind Suning that they were running an internet cafe, not a restaurant.

However, seeing Suning's frenzied expansion and the booming Tianchao Internet Cafe business, the executives immediately abandoned their attempts to advise against it.

The leisure area initially only had a few vending machines selling potato chips, cola, and instant noodles.

Suning said that wasn't enough; they wanted to add a board game area, a pool table, a basketball shooting machine, and mini karaoke rooms so that people who don't play computer games could find a reason to stay, and so that people who come with friends but don't play games themselves won't feel bored.

The accommodation area was initially just a few rooms upstairs with a few bunk beds, so that guests who stayed overnight to surf the internet would have a place to lie down.

Suning said that wasn't enough; they wanted to decorate it to the standards of a budget hotel, with private bathrooms, clean bedding, and soundproof doors and windows, so that young people who had spent the night playing games in internet cafes could take a hot shower the next morning before leaving, instead of going back to school with messy hair and an oily face and being laughed at by their roommates.

Later, during a post-mortem meeting, Suning even picked up a pen and added two more words to the blank space—"soaking in a bath" and "foot bath".

The meeting room was silent for about three seconds.

Zhuangzhuang was taking notes nearby, and paused for a moment with her hands hovering over the keyboard.

The operations team members exchanged glances.

Someone opened their mouth as if to say something, but then closed it again.

Suning put down his pen. "The flagship store has a separate bath and relaxation area on the third floor and above, equipped with a professional team of technicians. The bathing pool is made to the standard of Japanese hot springs, and the foot bath sofa is equipped with an independent screen, so customers can continue watching videos while soaking their feet. The bathing area is completely separated from the internet area, with separate traffic flow so that they do not interfere with each other."

"Mr. Su, we're an internet cafe, isn't this too much of a mixed bag?"

"Eating, drinking, playing, staying and relaxing should be integrated. Only by providing one-stop service can we build brand loyalty."

"But……"

"Take a school for example. An open school will lead to the development of nearby businesses, since many businesses cater to students. But if one day all schools become closed, and all the food, clothing, and accommodation can be taken care of on campus, then wouldn't all the money be made by the school?"

"This……"

"Therefore, our Tianchao Internet Cafe has created a closed-loop consumer complex, which can not only better catalyze Tianchao's internet business, but also create a brand that lasts for a long time."

"President Su, I understand."

"Remember! The motto of Tianchao Internet Cafe is service first."

"clear."

After the debriefing meeting ended, Zhuangzhuang was organizing the meeting minutes when, while Su Ning was drinking water, she quietly asked, "President Su, wouldn't the idea of ​​adding bathhouses and foot baths clash with the brand image of an internet cafe? In people's minds, internet cafes are still related to computers. Wouldn't adding bathhouses seem out of place?"

Suning put down his water glass and asked, "What do you think young people want most after playing games all night?"

"This……"

"A cigarette, a hot meal, a hot shower, a clean bed. I give them these four things, and they stay here. Once they stay, our internet cafe is no longer just an internet cafe, but a lifestyle."

"Understood! Service first."

"Yes! Service is paramount."

……

After this model was successfully implemented, the number of Tianchao Internet Cafe's directly operated flagship stores expanded rapidly.

After the direct-sale stores in Hangzhou and Shanghai opened, the East China region, which was overseen by Jack Ma, immediately expanded to cities such as Nanjing, Suzhou, Ningbo, Hefei, and Wuxi.

Jack Ma's approach to expansion is exactly the same as his approach to building Alibaba—fast, aggressive, and decisive.

When choosing a location in a city, the first thing to do is to ask how many college students there are, and then to find out where the busiest commercial street in the city center is. By combining the two answers, the location is decided.

After the pilot stores in Shenzhen and Guangzhou, which were overseen by Ma Huateng, generated positive data, stores in Dongguan, Foshan, Zhuhai, and Zhongshan were all launched within two months.

Ma Huateng is meticulous in his work. Before the opening of each new store, he personally reviews the decoration renderings and equipment configuration list to ensure that the system version and pre-installed software of each computer are correct before signing off on the project.

Suning itself is focusing on the Jiangbei region, starting from its Beijing headquarters and expanding to Tianjin, Shijiazhuang, Jinan, Qingdao, Shenyang, Dalian, and Harbin, selecting locations that are all densely populated with universities and core urban business districts.

The second flagship store in Beijing opened on Xueyuan Road in Haidian District, surrounded by seven or eight universities. On the opening day, the student crowd filled the third-floor bathing area with reservations for three days in advance.

……

While the flagship store was being developed, the franchise model was also being promoted simultaneously. Tianchao Internet Cafe's franchise manual was quite thick, with each page printed in color on coated paper. The cover featured a large photo of the bustling crowds on the opening day of the Zhongguancun flagship store, and the first page contained the sentence: "Tianchao Internet Cafe - More Than Just Internet Access."

The manual details all the support provided by headquarters: unified decoration, unified equipment, unified software environment, unified management model, and unified membership system.

Franchisees invest money, the headquarters provides brand and management, and Tianchao Capital offers equipment financing and leasing solutions.

Franchisees don't need to spend hundreds of thousands of yuan upfront to buy computer equipment; they can pay in monthly installments with interest rates lower than bank loans.

This plan is extremely attractive to investors in third- and fourth-tier cities because Tianchao Internet Cafe is more than just an internet cafe...

With everything from food and lodging to entertainment, leisure, bathing, and foot massage, this kind of store has a much larger radius of influence than a regular internet cafe.

A typical internet cafe can cover a radius of one kilometer, while a Tianchao internet cafe can cover an entire urban area or even a county-level city.

Many franchisees drove hundreds of kilometers to the directly operated stores in Beijing or Shanghai, saw them in person, and signed franchise agreements on the spot.

A franchisee from Baoding, Hebei Province, took a stroll around the Zhongguancun flagship store, going from the restaurant on the first floor to the bathing area on the third floor, and then back to the internet area on the second floor to sit for a while.

Then I went downstairs to the operations department and said, "This isn't the internet cafe I imagined. This isn't an internet cafe at all; it's clearly a complex. Get me a schedule, and I'll go back and find a shop."

"Okay! Our team will have dedicated personnel to assist clients with site selection, and we will absolutely not let franchisees' money go to waste."

"I came here because I trust the reputation of your Tianchao Group."

……

As stores have sprung up rapidly in cities of all tiers, the term "Tianchao Internet Cafe" has gradually lost its original meaning in the minds of young people.

It is no longer just a place to access the internet, but has become a consumer trend indicator.

University student unions hold club gatherings in the private rooms of Tianchao Internet Cafe because there is food, drinks, billiards, and karaoke. The cost per person is cheaper than going to a restaurant and karaoke, and there is no need to change venues. After eating, you can go upstairs to sing, and if you get tired of singing, you can go online.

Young couples no longer go to the mall for their weekend dates; instead, they go to the lounge area of ​​Tianchao Internet Cafe to drink milk tea, then go upstairs to play online games, and finally go downstairs to soak their feet.

Business travelers from other cities specifically book accommodations at Tianchao Internet Cafe because the prices are cheaper than budget hotels in the same area, the rooms are clean, there's a Galaxy computer for free internet access to handle emails, and there's a 24-hour restaurant downstairs.

Major business media outlets and financial newspapers have begun to pay attention to the phenomenon of internet cafes in China.

Why has an internet cafe become a new favorite among young consumers?

From Internet Cafes to Commercial Complexes: The Cross-Industry Ambitions of Internet Cafes in China

"The Expansion Logic of the Largest National Chain Internet Cafe Brand: Integrating Eating, Lodging, and Entertainment"

Such headlines frequently appear in the business section.

A reporter made a special trip to the flagship store in Zhongguancun, Beijing, and spent a whole day there, counting the number of customers entering the store.

As a result, the daily passenger flow exceeded 5,000 on weekdays and doubled on weekends.

The reporter also interviewed several young people who had traveled from other places specifically to experience the internet cafe.

When I got back, I wrote a long article, in which I quoted a college student from Hebei: "In the dormitory, you have to fight with your roommates for the internet cable. But in Tianchao Internet Cafe, you don't have to worry about anything. If you're thirsty, there's milk tea downstairs; if you're hungry, there's a restaurant; if you're sleepy, there's a room. I could stay here for a whole summer."

Of course, the most important thing is that Tianchao Internet Cafe and Tianchao-affiliated software have formed a perfect closed loop.

Every computer in every internet cafe, once turned on, has a neatly arranged set of Chinese-made hardware on its desktop...

QQ, Taobao, Xinghe Music, Tianmu Video, QQ Games Hall, Tianchao Input Method, Tianchao Browser.

When a user walks into an internet cafe, sits down, and turns on the computer, the first thing that pops up is the QQ login box.

After logging into QQ, I found that everyone in my friend list was online because they were all in the same internet cafe.

After chatting for a while, my friend sent me a link, which led to a game invitation in the QQ Games lobby.

After finishing the game, I'll browse Taobao to see if there are any cheap and good deals.

When you get tired of shopping, open Tianchao Music to listen to songs, or open Tianchao Video to watch a movie.

The whole process was seamless, requiring no downloads or registration of any new accounts; all services were linked together using the same QQ number.

More importantly, all the data generated by users in these apps—friend lists, game levels, shopping collections, playlists, viewing history—is stored in the cloud.

The longer they spend in the internet cafe, the longer this data accumulates.

When they bought computers for their own homes, the first thing they did wasn't to install the operating system, but to download QQ, because without QQ they couldn't find the friends they met in the internet cafes or join the group chats they joined there.

Once QQ is installed, other software such as Taobao, game lobby, music, and video will follow suit, because everything they have is in these software programs. Switching to any other platform means starting from scratch.

With the widespread adoption of internet cafes across the country, the number of internet users has begun to surge.

Previously, the bottleneck to the growth of Chinese internet users was the penetration rate of personal computers. A computer cost tens of thousands of yuan, which ordinary families could not afford, so they naturally could not access the internet.

Now, internet cafes in China have solved this problem—it costs three or four yuan an hour, and a dozen yuan for an overnight stay. Young people can use their pocket money to go online without having to save up to buy a computer first.

For those who have never touched a computer before, their first internet experience was in an internet cafe in China, their first registered account was QQ, and their first online shopping experience was on Taobao.

From the very first day they came into contact with the internet, they were immersed in the ecosystem of the Chinese system. By the time they became seasoned internet users, Chinese software was no longer a "choice" for them, but the "default".

The Chinese internet software ecosystem has risen rapidly thanks to this favorable wind.

QQ's registered users skyrocketed from several million to tens of millions, and then from tens of millions to over 100 million.

The number of registered merchants and daily active buyers on Taobao is also growing rapidly.

The number of users of Tianchao Music and Tianchao Video has increased significantly.

Several card and board games in the QQ Games lobby have seen daily active users in the millions, with "Legend of Mir" constantly breaking online player records after its launch.

At a monthly business analysis meeting of Tencent, Ma Huateng stared at the backend data in silence for a long time.

Then, with deep emotion, he said to his partner Zhang Zhidong, "In the past, Tencent grew slowly on its own, but now it's being pushed to grow by internet cafes. The number of new users this month alone is more than the number of users we acquired on our own last whole year."

Zhang Zhidong glanced at the data report and replied, "This is just the beginning. Franchise stores have only been established in less than half of the provinces."

"Mr. Zhang, do you think if we hadn't sought investment from Tianchao Capital in Beijing back then, we would have been killed by Tianchao Group's internet business by now?"

"I don't know! All I know is that Zeng Liqing's OICQ has been sued, and its user base is very low, it's on the verge of bankruptcy."

"..." Ma Huateng immediately understood Zhang Zhidong's meaning, after all, OICQ was their most likely fate.

...(End of this chapter)