After “de-LeTVization”, where are the opportunities for Xinyidao?

With Sun Hongbin taking over the company and Jia Yueting leaving the United States, the assets of the old LeTV are being reconstructed. Yidao, which has sticky users, has finally been redeemed by Taoyun Capital. But what are the opportunities for Yidao to get back on the road?

At least the mystery of this puzzle game has been revealed.

1. The end of team shock

It was easy for LeTV to take over. Although it repeatedly claimed that the company's governance structure would remain unchanged, rumors that Zhou Hang was sidelined by Peng Gang still persisted. From Zhou Hang’s open letter, his switch to Shunwei Capital, and the collective departure of the founding team, to today’s departure of four LeTV executives, and the rumor that Peng Gang may step down within 6 months.

That Yi Dao was troubled by all kinds of external information, and the change of afternoon tea within the company was considered to have ulterior motives. Today's personnel turmoil has not just begun, but is almost over. Although Yidao Yongche, a subsidiary of Taoyun, has not announced a new strategy yet, it is well versed in the principle of "pacify yourself first before you can calm others."

2. Resolution of disputes over funds and debts

What are the two reasons why Yidao got into trouble?

First of all, after LeTV took over, Zhou Hang had an optimistic estimate of the market structure. In order to quickly start the market, he started an unprecedented campaign of recharging 100 yuan to get 100 yuan back;

Secondly, LeTV's own crisis affected Chiyu, putting pressure on Yidao's operations to deliver, which in turn resulted in Yidao being unable to advance its strategic vision at the planned pace.

But looking at it from another perspective, Yidao has not gained everything. The 40 million users and 6 million car owners it has established with recharges are still effective barriers. Especially the resumption of driver cash withdrawals on June 30 with the support of Tao Yun has also restored confidence in the market.

3. “De-LeTVization” is basically completed

Many people could not understand the original business logic of LeTV Holdings Yidao, but in essence it was nothing more than a common practice of making good use of external forces and building momentum. At that time, Jia Yueting was obsessed with the SEE project. He was building a platform for Faraday in the United States. He was mainly adding communication methods to the content ecology to counter the aggressive Xiaomi after Chen Tong joined. In addition, it was to inject high-frequency scenes into the raging car-building movement.

Today's Yidao "de-LeTV" is not so much a clear break with the old financial backer LeTV as it is a break with the kind of greedy and flashy operating style.

Although the mystery is clear, whether Yi Dao can successfully solve the puzzle and complete the level depends on several points:

1. Reactivation of existing users

Yidao's recharge program started in November 2015 and reached its climax in July 2016. According to the data released at that time, 6.53 million users recharged, effectively driving the growth of revenue and user scale.

But since then, almost all third-party data show that the user activity of Yidao APP has begun to decline. This was described by Zhou Hang as "the money comes to the users, and the money goes to the users," but it at least solved one important problem.

That is to say, Yidao, which originally focused on user experience and closed itself in a relatively niche scenario, was able to complete the delineation of basic users on a large scale during the winter break of the subsidy war between Didi and Uber, although the cost was high.

There are only two paths to recovery:

Deprive users from friendly businesses through subsidies. However, today's online ride-hailing market is already a mature market under policy control, and reckless competition methods are difficult to achieve. In addition, users have been unable to request a ride and drivers have been unwilling to take orders. For Yidao, the time has not come yet to use subsidies to compete for users, and the cost is too high. Building reputation through services also has a time cost.

Find monetization opportunities from existing users. On the surface, it does not seem to be in the interests of Yidao to continue to serve these users who have entered the rebate consumption stage. However, the orders brought by the latter have a lubricating effect on Yidao's two-way stabilization on both ends of supply and demand. It also means that the downward trend of user activity has been curbed and the virtuous cycle has returned. As for the issue of rebate consumption affecting revenue, it is more about the ability of the postgraduate operation team and revenue management department in product design and scenario operation.

2. How much strength will Taoyun Capital use to support Yidao?

Taoyun Capital has invested in many projects, but they are generally concentrated in finance, new energy vehicles, consumer goods, entertainment and other fields, indicating that the investment direction focuses on areas with broad markets and offline scenarios.

Wen Xiaodong, the head of Taoyun Capital, once said in an interview, "We can't worry so much. We need to manage Yidao first and then talk about it." He also said that Yidao needs to continue to invest about 2 to 3 billion. Recalling that Taoyun had a series of in-depth interviews with Yidao's management, users and drivers before taking over, it can be seen that Taoyun focuses on Yidao's potential and the ability to collaborate with different industries.

3. Who is Xinyidao’s opponent?

During the Zhou Hang period, Yidao had three different types of business partners. One is Didi, which is also a C2C model, and previously included Uber China; the other is the B2C model of Shenzhou Private Car and Shouqi Ride-hailing; and the third is Caocao Private Car, Shanghai Volkswagen Group's Volkswagen Travel, etc., which are backed by Geely.

Yidao, which has already obtained 8 online car-hailing licenses, will not be its real rivals like Shenzhou Private Car and Shouqi Private Car, nor will it be someone with a big tree to enjoy the shade. It is just a test product for car companies to promote new energy vehicles.

The real target is Didi. Due to the strict entry threshold for online ride-hailing, Didi has to accept differentiated competition with cruising taxis. The market capacity has shrunk, and it is shifting from subsidy momentum to refined operations. This is reflected in a series of recent actions to improve service experience. This is not a market that Didi is familiar with, but it has more experience.

Yidao's previous settings, such as configuring English drivers and allowing users to select drivers, have shown a deep service culture rather than the genes of a GMV culture. In the era of reckless competition, Yidao once fell behind because of this. In Zhou Hang's words, it was "not ruthless and bad enough". However, in a standardized market, this is the core competitiveness.

4. Is overseas expansion a gimmick or a strategy?

Yidao launched its North American service in 2014, focusing on the overseas Chinese market that calls for rides in Chinese. In March this year, it announced that it would join the Splyt Global Travel Alliance, which promotes one-click cross-platform ride-hailing in more than 280 cities on four continents. Yidao is also one of the service providers. But Splyt is neither a price comparison platform that Chinese people are familiar with, nor is it a "gizmo" that can share all bicycles with just one APP. For all participating companies, it is an order-taking platform that connects API interfaces and account systems.

Of course, Yidao's overseas expansion should not just rely on this kind of diversion platform without barriers. It is more likely to be deeply wedged in specific areas where Taoyun invests, or to seek opportunities for cross-industry cooperation.

5. Will derivative business continue to be promoted?

In the past, Yidao had many ambitious plans, not only taxi-hailing and special-car services before Didi, but also Yiqi Internet's car-making plan, which was earlier than LeTV, and Haiyi Travel's car finance plan. Yidao's concept has also changed from "private cars anytime, anywhere" to "car sharing ecology".

After Tao Yun takes over, these plans that have been dormant for a long time may be restarted.

So, what will be the market structure after Yidao’s return?

Didi's merger with Uber and the introduction of new policies for online ride-hailing have made the market surprisingly calm, but there are still many undercurrents. Both Shenzhou Private Car and Shouqi Ride-hailing have built C2C platforms to poach Didi, while Didi, which has invested in ofo, is committed to completing its product line.

The market shift from overt competition to covert competition has given Yidao a chance to recover, but the latter still needs to pay attention to two points:

1. Quickly restore the vitality of both supply and demand ends of the platform, increase user stickiness, and enter a virtuous cycle;

2. Develop effective product strategies to balance the pressure of concentrated consumption and rebates on existing users;

At the end of last year, Cheng Wei, who attended the Third World Internet Conference, said that "Didi's home game in China is over." He was also worried that Didi "lost competition, lost vitality, and lost its future."

Regarding Cheng Wei’s optimism and self-confidence, Xin Yidao, which has stood up again with the support of Taoyun Capital and is once again conquering the city, may have different opinions.