Mr. Ma has been quiet for a long time, and I miss him. Without Mr. Ma, the business world has become much colder. In 2016, Mr. Ma proposed New Retail. In the following two years, the concept swept through all commercial sectors in China with the force of a pancake rolling up a scallion, and bubbles of 'New Retail' floated across the land. At that time, I wrote several articles about 'New Retail' and was frequently mistaken for a 'New Retail expert.' I still clearly remember an industry forum inviting me to speak on 'New Retail.' I asked what kind of companies would attend, and they said 'manufacturers and distributors.' I asked, 'Then why are you talking about New Retail? Isn't that digging a hole for yourselves and jumping in?' They didn't understand what I meant. I said, 'What if my speech topic were "New Retail Is a Big Scam"? Would that be acceptable?' They never replied, and out of politeness, they didn't insult me either. I don't know if they blocked me. They probably thought I was crazy. Although I've seen all kinds of crooked commercial pseudo-concepts, I'm still shocked by the waves of 'New Retail' back then. It created two miracles: First, despite the conceptual confusion, so many people flocked to it. Second, it was clearly a platform-positioned concept that severely weakened the channel power of brands and distributors, digging a pit for them, yet brands and distributors competed to learn from it. As Uncle Benshan said: 'A mouse serving as a companion to a cat—you're risking your life for money.' The problem is that brands and distributors learning this won't make money; they'll only lose more. Normal thinking: If something emphasizes being 'new,' it must clearly define what is 'old.' Only then can it claim what's new, what's different, and what changes it brings. Only with facts can people be convinced. A 'new' that doesn't clearly define the 'old' is just 'hooliganism.' Let's recall how Mr. Ma and others defined New Retail. There were two most dazzling hats. The first was 'reconstruction of people, goods, and scenes.' The second was 'providing users with value-for-money experiences and services at all times.' Wow, that works? What does 'reconstruction of people, goods, and scenes' mean? Retail has always been about customers, products, categories, business districts, locations, and shelves—isn't that what you call 'people, goods, and scenes'? What does 'reconstruction' mean? Isn't it just a fancy way of saying 'new'? What does 'providing users with value-for-money experiences and services at all times' mean? Isn't it just saying your company is good? In plain language, these two high-sounding hats translate to: when asked what New Retail is, they say, 'New Retail is newer retail, better retail.' It's like listening to a speech and hearing nothing new. This is the pinnacle of internet language corruption—I give it a big thumbs up. If you're confused yourself, how can you make others clear? If you're muddled, no matter how much you talk, you can't do well. So, starting in 2018, various New Retail business models began to fail, suffering heavy losses. I won't mention specific casualty numbers; let's be kind. If interested, you can search yourself. Manufacturers and retailers who played along with the platforms: a few got some benefits, but most followed the trend, lost money, and gained nothing. On the other hand, some small offline retail stores and secondary wholesalers who saw things clearly, along with various social retail, community retail, group buying, and subsidies, managed to reap some benefits. By 2021, platforms faced unprecedented rectification, and the already disgraced 'New Retail' gradually faded from discussion. Now, if you tell someone, 'You're doing New Retail,' it sounds like an insult and might get you beaten up. Does that mean 'New Retail' is a big scam and absolutely unreliable? Of course not. 1. The current mainstream retail formats indeed don't adapt to business development. Productivity determines production relations, so there must be a New Retail that revolutionizes old retail. 2. The biggest problem with old retail is the absence of retail entities. No one performs the retail function (i.e., no one sells goods). Retailers become platforms, degenerating into real estate retail, advertising retail, property retail, profiting by charging tolls and head fees. 3. The various 'New Retail' concepts represented by Mr. Ma in the early years were precisely representatives of old retail. When these old retail formats were about to be disrupted, they refused to exit the historical stage. They used new concepts and technologies to package themselves, trying to survive. New Retail should certainly rely on new technologies, but more critically, it needs new concepts. That means abandoning the old concept of just collecting money without performing retail functions, and becoming professional retail operators who truly understand buyers and product rules. The biggest conceptual shift of true New Retail compared to traditional retail is: Traditional retail sells goods, buying in bulk and selling piecemeal; represented by traditional department stores, small retail shops, and peddlers. Old retail collects tolls, like 'this mountain is mine, this tree is mine'; represented by traditional large platform e-commerce like Tmall, JD, Pinduoduo, and traditional large supermarkets like Auchan and Carrefour, as well as various 'new' formats under the banner of New Retail. New Retail, on the other hand, uses internet technology to buy goods on behalf of consumers, essentially serving as buyers for consumers. Traditional large stores have thousands of SKUs; they collect tolls, so the more people, the better. But Sam's Club has less than a third of the SKUs of traditional stores, and Costco may have even fewer. I act as a purchasing steward for customers. Through professional judgment, I only provide what you need most. Why display so many dazzling products? It's wasteful and inefficient. This is New Retail logic. Some good community group buying platforms, like Dingdong Maicai, roughly follow this logic; some good live-streaming e-commerce also follows New Retail logic—Weiya is indeed a pity; NetEase Yanxuan also has traces of New Retail; JD's founding intention was more like New Retail logic rather than platform toll-collecting logic, but it inevitably deviated along the way. Nowadays, from live-streaming sales to community group buying, from various platform self-operated selections to traditional hypermarkets trying membership store models, true New Retail has sprouted in many places and is quietly developing. Why is society no longer shouting about New Retail or hyping the 'windfall'? Take out your notes; let's learn a concept—the Technology Hype Cycle, also known as the technology adoption curve. This is a tool model used by Gartner, the world's largest IT consulting firm, to judge the development of emerging technologies. A new technology typically goes through five stages from birth to mature application: The first stage is the Innovation Trigger: At this point, it's just a cutting-edge technology, understood only by a few insiders. How to apply it commercially is unknown; people can only speculate. It's just 'lab technology.' The second stage is the Peak of Inflated Expectations: With a few success cases or large capital investment, media coverage explodes, aggressive and speculative companies flood in, and the technology's visibility quickly peaks. The third stage is the Trough of Disillusionment: Application flaws begin to surface; people find it's not so beautiful. The wind blows over, and dead pigs fall everywhere. Media kicks it when it's down, saying how unreliable it is, and then it gradually cools. The fourth stage is the Slope of Enlightenment: As flaws are fully exposed and details become clearer, true doers start solving problems, producing second and third-generation products, and rational companies begin to try. The industry starts paying attention again, media follows, public awareness grows, market acceptance rises, and related companies experience rapid growth, even becoming industry giants. Key point: The Slope of Enlightenment is the best business opportunity. The fifth stage is the Plateau of Productivity: The technology becomes mainstream and mature, and the competitive landscape stabilizes. Public and industry opinions converge, no more controversy, and the heat subsides. The internet development over the past thirty years is a typical example. In the early 1990s, it was the Innovation Trigger. Bill Gates talked about the internet and was ridiculed; it was like talking to a brick wall. Ma Huateng introduced QQ to Zhang Ruimin, who said it didn't 'move' him. In the late 1990s, many internet startups emerged, bubbles began to form and grew bigger, finally bursting in 2000 with the Nasdaq internet sector crash, which then affected China. In 2002, Chinese internet companies hit rock bottom; many early internet companies perished without a trace. The surviving BAT later became true internet giants. From 2003 to 2009, many internet companies developed quietly, entering the early Slope of Enlightenment, with little public attention. Singles' Day 2009 was a milestone; the public truly realized the internet had arrived, and media and capital focused again. In the following decade, super internet companies like WeChat, Toutiao, Didi, Meituan, and Pinduoduo emerged. 2021 was another milestone; the state began regulating monopolies, and internet platforms said goodbye to wild growth. But the internet had fully entered and changed people's lives. Large internet companies gradually became social and commercial infrastructure, taking on social and public welfare attributes. The industry structure is basically stable, and entrepreneurial opportunities are scarce. This is the Plateau of Productivity. We see that any successful commercial technology innovation, as long as it's not a pseudo-concept, basically follows this pattern. Pseudo-concepts die midway. This is the true law of development for new things and technologies, not what Mr. Ma said years ago: 'can't see, can't understand, look down on, can't catch up.' That's the rhetoric of cutting leeks and creating anxiety, not real business laws. Mastering the 'Technology Hype Cycle' will prevent anxiety because you know: The biggest risk for new technologies and models is during the Peak of Inflated Expectations, when public and media discussion is hottest. The biggest opportunity comes from the Slope of Enlightenment, the calm after the bubble bursts, which, despite being the biggest opportunity, is rarely noticed. That's why most people in the world can't grasp true business opportunities. As Buffett says: 'Be fearful when others are greedy, and greedy when others are fearful.' After learning the 'Technology Hype Cycle,' I believe you now understand what stage New Retail is in. Yes, the 'New Retail' bubble represented by Mr. Ma has ended. Now is the early Slope of Enlightenment, where few pay attention, but opportunities are plentiful and problems are not few. The Slope of Enlightenment is the stage for doers. We see some large retail stores transforming, some top livestreamers building supply chains, and some community group buying companies spending heavily on front warehouses to deliver fresher vegetables faster and more conveniently. And distributors—'the most important source of commercial vitality'—are also busy planning how to operate New Retail. They try to grow into professional operators of new retail formats, and some even help small retail stores evolve into new retail formats. New Retail in the Slope of Enlightenment is not perfect. In any format, when the tide recedes, you see people in the nude or in torn swimsuits; flaws are obvious. But the existence of these problems is where New Retail's opportunities lie. Solving these problems is the main driving force for New Retail to eventually replace the current mainstream old retail. True revolution is never announced with drums and gongs; it flows beneath the surface. And true market opportunities are never media hype or windfall talk, but the process where doers identify social problems and solve them. Only retailers who take on the responsibility of retail, know how to buy and sell, skillfully use new technologies to improve operational efficiency, and bring greater satisfaction to customers are truly New Retail. Only they match the function of retailers in this era to deliver and enhance value. Source: Laomiao Tears Marketing (ID: yiheyingxiao) Author: Xiangma Laomiao -END-