Business Model by Introducing Alipay free essay sample

To solve the problem of a clear decrease of revenue in September, we proposed to update our business model by introducing Alipay as one of payment methods, creating an evaluation system, and introducing cash-rebating system to customers as new sales promotion strategy. It will help us to attract old customers and new customers. *************************************************************************** Overview With the rapid development of technology, the Internet has been an unprecedented impact on peoples daily life. Shopping-online is no longer a privilege of the minority, but a fashion, or a way of life, to more and more people. However, ordering food online is a recent business on the Internet. This business develops quite fast, and more and more competitors are jostling into this field. Analysis of Problem Since more and more competitors are growing both in size and number nowadays, a clear decline of 22% in the market share of our company can be seen. Due to this decline, our revenue of September decreases by 6,000 yuan, which is indeed a dangerous warning. Here are the possible reasons for this decline. Low threshold for new entrants Our business has a low threshold for new entrants. Hence, other online meal-order companies can easily learn from our business mode, and put up the same menu on their websites at the same price. They even add other restaurants around other universities on their list. Therefore, some of our customers have turned to their websites to order meals. Sales Promotion of other companies Other online meal-order companies recently have held a series of activities to attract customers at a loss of money. Some of them use the coupon strategy, and some of them use the gift-presenting strategy. These competition strategies are blind and unhealthy, which cannot persist for a long time in theory and in reality. However, it indeed took our customers away. To sum up, our profit-making model has fallen behind the rapid development of this business. Its easily to copy and exceed. Therefore, we must update this model and seize every minute and second to run ahead in the online meal-order market. Illustration of Solution We propose that we should improve our marketing mode including payment model, evaluation system and sales promotion system. Introducing Alipay as payment method With the rapid development of online shopping and the great improvement of on-line payment system, people increasingly prefer to shop online and pay online. Therefore, by setting up an online payments system, we can attract those who like paying online and thus boost our website visits and increase meal reservations. Create an evaluation system We could start a star-rating system like the one in Taobao to let the consumer have an access to evaluate the food and the service provided by the restaurants. Thus, it naturally forms a constraint mechanism for the food providers so they will improve their food quality and accelerate food delivery to meet customers’ satisfaction. As a result, by increasing the credibility of our website, more and more people want to order meals on our website and more and more restaurants will want to join us. Consequently, our business performance will be boosted greatly. Creating a cash-rebating system as new sales promotion strategy: Since other online meal-order companies use many sales promotions, such as coupons, gift-presenting, and other strategies, which are all not directly and precisely satisfying customers needs, we suggest that we can use a long-term cash-rebating system, instead of copying other companies short-term activities. By adopting this system, we directly rebate cash to customers ordered from our website, instead of presenting gifts which they dont like at all. Moreover, on special days, like raining and snowing day, or holidays, we can double our rebating rate. In this way, customers will get profits by ordering from our website, and they will have greater satisfaction on the price. Hence, we will get customers back, as well as attract new one. More importantly, we can expands the sales of restaurants cooperating with us, which gives them incentives to rebate more to us, and thus we can get more profits. Benefits and Cost Analysis According to our calculation, these three solutions can take our customers back and attract new one as large as possible. Estimated benefits Item| Estimated benefits(yuan)| Estimated benefits per month(yuan)| Introducing Alipay| 36,000| 3,000| Creating evaluation system| 24,000| 2,000| Creating cash-rebating system| 60,000| 5,000| Total | 120,000| 10,000| To sum up , by these three solutions, we will get: Increasing financial gains; The new payment model and promotion model will bring us more customers and food-providers. As a result our financial gains will greatly increase by 120,000 yuan a year. Increasing credibility; The evaluation system could improve the quality of the food providers o meet the customers’ satisfaction. By doing so, customers and food-providers will choose to trust us, and corporate with us. Hence, our credibility will definitely raise. Enlarging market share. With our outstanding marketing strategies, we will be the leading on-line meal order company, which occupies the major marketing share. This will bring us more economic profits, as well as good reputation. Estimated e xpense Item| Cost(yuan)| Cost per month(yuan)| Introducing Alipay| 12,000| 1,000| Creating evaluation system| 6,000| 500| Creating cash-rebating system| 10,000| 833. 33| Total| 28,000| 2333. 3| Comparing with the sales revenue decline of 6000 yuan in September, and 10,000 yuan estimated increase in revenue per month, 2333. 33 yuan can easily be covered and the benefits we get from these systems will persist for at leat two years. Conclusion Facing fierce competition in the market, we must catch up other competitors in attracting customers. Therefore, we propose we shall introduce Alipay as one of payment methods, and create an evaluation system and a cash-rebating system as new sales promotion strategy. Take the action now and the decline of revenue will be solved in time.