In fact, Didi was not only unprofitable on 20 18, but an email revealing the founder Cheng Wei showed that Didi had never been profitable since its establishment six years ago. In this case, whether it is profitable or not has little to do with the market or whether there are competitors. The deeper pain point lies in its own positioning and operation. Looking back, when Didi and Uber competed for the market, in fact, not only did Didi not make a profit, but Uber's entry into the China market was also quite tragic.
Uber has to pay 120% for robbing drivers and passengers when completing a single order in China. I believe many people have caught this wool. What about Uber, which withdrew from the China market? Evaluation Jun found some data from the Internet. Uber's data in the first two quarters of last year were not bad, with a profit of $2.456 billion in the first quarter of 20 18, a loss of $89 10/00000 in the second quarter and a profit of $0/5.65 million in the first half of the year. People who pay by car are passengers, and most of Uber's income naturally comes from passengers. Obviously, the basis of profit is that Uber can not only pay subsidies, but also collect some money from passengers.
Go back and analyze the reasons for Didi's huge losses. In fact, the foundation was laid from the beginning. Passengers who harvest at ultra-low prices and subsidies will leave you immediately when your price is no longer favorable. So a vicious circle is formed, and users can only be further retained by the same means. The amount of passengers' consumption is an important part of Didi's profit. If passengers are only willing to pay a small amount of money, it will become a big problem for Didi-money will not come out of thin air.
What are the pain points of traveling in China? In fact, taxi service can't meet the demand. As long as it can make travel faster and more comfortable, Didi has already realized its own value, and this value can be directly realized. But perhaps because of the fierce competition in the early days, Didi is now aiming in another direction, that is, the price is cheaper.
In the evaluation of Jun's view, both express trains and hitchhiking are favored by users because they are cheap, but the cost of car use is rigid and someone must pay the bill. If passengers are unwilling to pay more, the only way to maintain it is to pay for it by Didi. What's more, low prices have brought about an overall decline in the travel experience. For example, various vicious incidents that frequently occur on Didi have also appeared in these two types of products with low prices as their main selling points.
In the final analysis, everything is because Didi, as a network car platform, is willing to please passengers with low-cost and low-quality services. Since only low-quality services can be provided, passengers are naturally only willing to pay the bill at a low price. Over time, this has formed an irreversible consumption habit, which has become the root cause of Didi's huge losses and even layoffs. However, what can be done to reverse it? It is difficult enough for users who have been trained for 6 years to reverse it.