Millet throws heavy money to buy a payment license, financial map and then expand

From the beginning, Xiaomi has shaped the "Millet Miracle". It took only five years to become one of the world's most highly valued technology start-ups. Now this myth has begun to crack with the overall slowdown of the Chinese smartphone market.

The decline in sales of Xiaomi mobile phone is almost inevitable. Whether it is the price/performance advantage or the cheap social network dividend, the advantage of Xiaomi's rapid growth in the past five years has disappeared. In addition, the mobile phone market has entered the post-smart era. The proportion of change users is a large proportion, all of which have caused the growth curve of Xiaomi's rapid rise to bow.

Xiaomi tried a variety of ways to seek breakouts when the supply was low, such as laying out offline stores and even developing chips, but the layout of channels and technologies required long time and high cost, and it was difficult to achieve immediate results in one fell swoop. How does Xiaomi restart high growth, commercial eco-strategy expert Zhou Shucai said that Xiaomi's ecological strategy needs to recognize its long-term competitive advantage. Xiaomi's genes are Internet and software application genes, and user fan operation and application software innovation to promote strong user growth should be placed One, overcorrection will weaken the core competitive advantage.

In this context, can payment become a squad that guides Xiaomi to defeat?

On September 1, Mi Pay officially debuted. Like Apple Pay and Samsung Pay, Xiaomi Payments uses NFC (Near Field Communication) technology to complete transactions by placing the phone close to a POS terminal that supports the "UnionPay Cloud Pay" feature. There are 21 Mi Pay cooperative banks, supporting bus cards in Shanghai, Shenzhen, Beijing, Guangdong, Suzhou and Wuhan.

Just one day ago, Huawei also launched Huawei Pay, which also uses NFC technology, and supports POS terminals and bus cards with the function of “UnionPay Cloud Flash Payment”.

"For the ecology of the entire software Internet, payment is an indispensable part. Only after payment is made, the entire ecology can become a closed loop." Xiaomi paid general manager Qian Bird (original name: Song Zhenzhong) said.

With the launch of Mi Pay, Xiaomi's software and Internet service ecosystems have become more complete, and their ecological strength has gradually taken shape. The battle between Xiaomi and Huawei has not reached the end, and the return of Xiaomi to its ecological advantage means that a new round of war has begun. "Xiami used to put too much bet on the mobile phone." A person who has worked closely with Xiaomi told reporters that although Xiaomi’s core foundation is still a mobile phone, Xiaomi is facing a lot of mobile phones both inside and outside. Pressure, millet adjustment strategy to develop ecology, which at least can make the millet roots stable.

Dual identity

Just like the mall is the support of Jingdong, Taobao is the support of Ali, WeChat is the support of Tencent, Xiaomi's e-commerce is also the most important support for Xiaomi to enter the payment field. Mobile phone manufacturers to seize the payment scenario is only the appearance, the root of this battle is that mobile phone manufacturers become a conduit. They either work for Alipay, WeChat, or work for UnionPay, and it is difficult to play a leading role in the field of third-party payments.

Huawei has three business groups (BG) - consumer BG, enterprise BG and carrier BG. At present, the product division of Huawei Pay belongs to the cloud service department of consumer BG and is called “Huawei Wallet”.

"Huawei itself is a channel and a channel for payment. We don't want to be users. We want Huawei users to feel Huawei Pay by using Huawei's mobile phones." Su Jie, President of Huawei Consumer BG Cloud Services, at the launch ceremony of Huawei Pay Say. He said that Huawei's original intention for mobile payment is based on Huawei's mobile phone users, and through cooperation with partners to provide more convenient and secure services.

The key to understanding Xiaomi's payment is that Xiaomi is not a pure mobile phone manufacturer. The third e-commerce identity in the country makes Xiaomi more ambitious than other mobile phone manufacturers including Huawei in the layout payment business and financial business.

The field of payment for millet layout was as early as four years ago. In mid-2012, the “Millet Payments” department was established, and initially began to incubate third-party payment services with “Miancoin”. The department is affiliated with MIUI, which provides software and Internet services. The department also includes the “Millet Finance” business unit that provides services such as wealth management, insurance, and loans.

The layout was early and valued. However, the Xiaomi payment business has not been done. At that time, the NFC payment market was very chaotic. The industry chain was long and the participants were many. The interests of banks, UnionPay, mobile operators, mobile phone manufacturers and technology (patent) providers were difficult to balance, which led to slow development.

During the slow development of near-field payment, Internet payment companies used the QR code to preemptively distribute offline mobile payments and bypassed UnionPay in the payment process. According to Analysys International data, in the first quarter of 2016, UnionPay's mobile payment market share was only 0.69%, and Alipay and Tencent's Tenpay accounted for 86.44%. In the face of fierce competition, UnionPay accelerated the coordination of related interests and launched “UnionPay Cloud Flash Payment” in December 2015, which supports both iOS and Android operating systems. This year, various mobile phone manufacturers have successively launched NFC mobile payment services, all of which are in cooperation with “UnionPay Cloud Flash Payment”.

Thousands of birds said that Xiaomi is currently the only payment company that is both near-field and remote. For Alipay and WeChat, Xiaomi has hardware that they don't have, and can do near-field payment. For mobile phone manufacturers, Xiaomi has its own unique Internet ecology, which can be used for remote payment. Xiaomi also laid out both at the same time, in order to find opportunities to overtake the corner.

“Xiaomi is going to make payments, not because it is a mobile phone manufacturer.” The biggest advantage of Xiaomi’s payment lies in the natural user group that its e-commerce business carries. Just like the mall is the support of Jingdong, Taobao is the support of Ali, WeChat is the support of Tencent, Xiaomi's e-commerce is also the most important support for Xiaomi to enter the payment field.

In contrast to Huawei, a Huawei consumer BG cloud service department told reporters that Huawei has not done remote payment at present, but Huawei has launched the "scan code second payment" function on its P9 mobile phone, that is, when the mobile phone is black screen, it can use fingerprints quickly. Calling out the payment function, Huawei also opened the function to payment service providers including Alipay, thereby providing Huawei mobile phone users with more convenient services.

Subsequently, on June 13, Xiaomi announced that Sichuan Hope Bank Co., Ltd. (hereinafter referred to as “Sichuan Hope Bank”), which was jointly applied by seven Sichuan enterprises including New Hope Group, was approved by the China Banking Regulatory Commission. Xiaomi accounted for 29.5%. Second only to New Hope Group's 30% share, becoming the second largest shareholder. Sichuan Hope Bank has a registered capital of RMB 3 billion and is the first private bank in Sichuan Province. Since then, Xiaomi has entered the banking industry.

Compared with Ant Financial, Jingdong Finance, etc., Xiaomi Finance is relatively scattered at this stage.

People who have dealt with Xiaomi for a long time said that Xiaomi’s business structure is centered on partners and partners are expanding into the financial sector according to their respective business needs. For example, Xiaomi payment is derived from the MIUI business demand that Hong Feng is responsible for. The bank license is derived from Lei Jun's industrial layout, and Xiaomi crowdfunding is more derived from the ecological chain business demand that Liu De is responsible for.

Some people said that Xiaomi is the third largest e-commerce company in the country. If it is in normal development, Xiaomi Finance now has at least one prototype of ants. Xiaomi’s financial sector is currently showing a significant lag. The main reason is that Xiaomi’s team lacks a partner who leads the financial structure. Otherwise, Xiaomi’s traditional “troika” (mobile phone, Micha, MIUI) is very likely. It is the “four driving”, and with the expansion of Xiaomi and its related product systems and revenue scale, the potential of consumer finance and supply chain finance in the later period is very large.

Realizing ecological advantages

Xiaomi is a consumer Internet gene. Now, to learn the industrial Internet, Huawei is just the opposite. With the launch of Mi Pay and the frequent layout of Xiaomi Finance, Xiaomi’s ecological empire has matured.

Xiaomi's ecosystem is based on the user-centered, integrated business model of hardware, software and services. The hardware section is divided into two parts: the first is Xiaomi's self-developed section - Xiaomi mobile phone (including Xiaomi tablet), Xiaomi TV (including Xiaomi box) and Xiaomi router; the second is Xiaomi's ecological chain products.

"Some people sing Xiaomi today, but the value of Xiaomi can't just look at the shipments. This view is one-sided." Yu Jun, the investment manager of Jiyuan Capital, said that Xiaomi's core and strategic basis must be mobile phones. But today is more than just a mobile phone. Xiaomi's software and Internet services, including a variety of active applications (and distribution), games, e-commerce, finance and eco-chain hardware business, constitute the "frigate" of Xiaomi's ecology.

After collecting payment and financial weapons, can Xiaomi's larger ecosystem bring value to Xiaomi? Can Xiaomi rely on its ecological advantages to regain a game in the next round of competition with Huawei?

In the process of Xiaomi's realization of ecological advantages, Huawei is also vigorously developing its own cloud strategy layout. On August 31, 2016, the three-day HUAWEI CONNECT 2016 was opened in Shanghai. At the conference, Huawei first comprehensively expounded its cloud strategy and positioning – “Customer-centric, focusing on ICT foundation” Facilities, providing innovative cloud technology, becoming a preferred partner of customers and actively participating in cloud ecosystem construction."

Zhou treasure cabinet analysis, ecological strategy has two major latitudes in the field of consumer electronics, one is the consumer Internet ecology, the other is the industrial Internet ecology, the logic of the two is completely different - the consumer Internet is the BAT era, the backward margin of zero marginal cost; industrial Internet It is mainly forward-oriented investment. Relatively speaking, Huawei is an industrial Internet gene. Now, to learn about the consumer Internet, Xiaomi is just the opposite.

He said that if Xiaomi wants to use the consumer Internet to pull back, he needs to pay more attention to the innovation of user fan operation and application software, and respect the fashion and youthfulness of consumer Internet marketing; if you want to pull back from the industrial Internet, you need to work hard, and The supply chain works closely together to make high-value products, because high-value products are the correct values ​​of the industrial Internet eco giant.

"If Lei Jun does not give up the thinking inertia of the successful consumption of the Internet, it will take time to find its own position in the new competition." Another person close to Xiaomi said.