Introduction: Although "the consensus of fools" is also consensus, it quickly collapses once the trend passes. In recent years, various industries have been swept by a trend of "disintermediation." It is called a "evil wind" because middlemen have been demonized, and some business laws have been artificially distorted. Many people, under the banner of "removing middlemen," become middlemen themselves, claiming not to earn the difference while profiting from both sides. Many manufacturers, who actually operate B2B2C businesses, would have basically completed their duties by doing well in branding and products. However, they are fooled into directly doing B2C business, allegedly to avoid being eliminated. Frightened, they quickly set up flagship stores, hire customer service, create product detail pages, run promotions, do keyword optimization, handle orders, shipping, and customer complaints themselves... They themselves are confused about whether they are brand owners or distributors. The problem is that although they have taken over the distributors' work, they have not gained the distributors' profits, and even their own profits have been sacrificed. Originally, by selling offline through distributors to retail terminals, they could earn a profit margin of about ten percent. But after removing the middlemen and doing it themselves, they only have a profit margin of two or three percent, and many even suffer losses. They do more work but earn less profit, and many business owners cannot understand why. In previous articles about distributors, Lao Miao has put forward several viewpoints:

  1. Middlemen emerged in the development of the market economy; under normal circumstances, there are not many redundant links to remove.
  2. The existence of middlemen greatly improves business efficiency, not reduces it; therefore, we see that direct sales without middlemen often result in higher product prices, and online flagship stores without middlemen often fail to make money.
  3. The role of middlemen is not only to reduce transaction links but also to provide promotional promotion, negotiation, ordering, information collection and organization, inventory transfer, and bear financial risks. They are the most critical link in business, so Kotler calls them the "main source of economic benefits" for achieving commercial success.
  4. Our country's market economy started late, and agricultural civilization has a long history. In public perception, the value of "middlemen" is not recognized. "Profiteers, speculators, pimps, all merchants are cunning..." Middlemen have been professionally demonized for thousands of years, with a long history. Behaviors that go against business laws, like "factory direct sales," always have a market. Li Xiaolai once said a piercing truth: "The consensus of fools is also consensus." This movement is the most massive and thorough disintermediation movement in the past forty years. It leverages changes brought by new technology applications, exploits people's common cognitive misunderstandings, creates false trends, and vilifies middlemen. And those who shout "no middleman to earn the difference" the loudest are precisely the bigger middlemen formed during this wave. They have enclosed a large amount of "land"—massive capital and massive traffic. Their scale is enormous, but their value is far lower than that of traditional middlemen. They claim to no longer earn the difference, allowing sellers to sell more and buyers to spend less. They claim not to do e-commerce themselves but only cultivate others to do e-commerce. They are "living Lei Feng," always thinking about "empowering" upstream and downstream. They never call themselves middlemen because, in their mouths, middlemen are "profit-seeking unscrupulous merchants," the targets of their revolution. So they all have a nice name: "platform." Although business efficiency has not improved, this time they have indeed eliminated a large number of traditional middlemen. Many surviving traditional distributors open their eyes and see that almost every industry faces one or two super-giant "platforms" that they cannot bypass. When they go to negotiate cooperation, the platform says, "We only cooperate with manufacturers, not with distributors," and dismisses them. However, the "manufacturers" that have been "flipped" are not so lucky either. Since the "platform" does not do the retailer's work, these tasks fall on the manufacturers themselves. But they are not good at it, so they have to bite the bullet. Yet the "platform" cannot "empower" you for free; fees are inevitable. To maintain its low-price advantage, the "platform" also uses various means to force you to sell at low prices. As a result, manufacturers act as both father and mother, but in the end, they earn the money of a grandson, and sometimes they don't even earn that. In the value chain of production, supply, wholesale, and retail, the "platform" has formed a dominant position and uses its discourse power to squeeze other value links. This has been regarded as a "public hazard" in many industries. Facing them, brand owners and traditional distributors cannot fight, cannot bypass, cannot afford to offend, and cannot hide. How to break through? Chairman Mao said: despise the enemy strategically, but take them seriously tactically. There are too many tactics to discuss; today we will talk about how to despise them. First, be wary of those intimidating concepts: "If you don't do X, you will die," "If you don't use X platform, you will die," "If you don't do new retail, you will be eliminated." Such clichés have been around for decades, just with different concepts. If you follow these concepts that scare you, you will really die. Especially those concepts that first make you lose money and promise future profits—be extra cautious. Brand owners should have sufficient brand confidence, and distributors should have sufficient operational confidence. In fact, if you do your basic duties well, you won't die without e-commerce, you won't die without new retail, and you won't die without new media. Moreover, someone will naturally come to help you do these things. Have you seen iPhone rely on e-commerce platforms? Do they search the world for new retail? Or do they bury their heads in creating viral content? The second key point is to abandon the false thinking of bubble traffic and return to value thinking. In 2018, many celebrities passed away, and there were also many big and small business failures. Some failures were due to falling into the trap of bubble traffic. Many people are bound by platforms because platforms have huge traffic. A Double 11 or Double 12 can generate such huge sales, which is tempting. But how much of this traffic is valuable? Even if it is valuable, how much belongs to you? Traffic brought by ultra-low prices is bubble traffic; traffic brought by excessive service is bubble traffic; traffic brought by high subsidies is bubble traffic. These bubble traffics often bring you few valuable users, many "junk" users, and high costs. How can you not lose money? Back to business common sense: Users who are willing to pay for you are valuable users. "The consensus of fools" is also consensus, but it can only be glorious for a while. Once the trend passes, it quickly collapses. What truly has vitality is consensus that conforms to business laws. Similarly, whether brand owners or distributors, they should focus on shaping their own value. Brand owners should build brands, innovate products, have great product ideas and meaningful brand concepts; distributors should understand operations, be good at management, and closely adhere to the core functions of middlemen. Never be led by the nose by someone throwing a bone; it wastes resources and may even cause you to lose your core competitiveness. Third, return to "people." Since Marketing 3.0, Kotler has been advocating human-centric marketing. New retail also talks about the reconstruction of "people, goods, and places," with people being the most critical factor. The initial state of business was from producer to consumer. With the improvement of human-centricity, the use of big data, and the increased predictability of consumer behavior, the basic form of future business will definitely be from consumer to producer, i.e., C2B. People become the core of business. There are many methods to capture "people": relationship marketing, brand resonance, niche marketing, circle interaction, extreme fans—these methods have been sought after in the internet environment in recent years. These are all effective ways to return to users. No matter how the market changes, capturing people is the fundamental way to capture the market. Finally, it must be said that platform merchants will die, and soon. The powerful but distorted platform merchants are inherently intermediate products of business development, special existences in a special market. After the capital burning game ends, there will be few such backward business models as platform merchants; they will become professional service providers. Platform merchants have developed to today with enormous scale but full of loopholes: traffic growth is nearly exhausted, and traffic has become ridiculously expensive; sellers are awakening to losses, consumers expect better options, and logistics providers are difficult to control. Externally, platform merchants are already surrounded on all sides. Professional brand owners and professional distributors use their own traffic to impact platforms: Apple, Huawei, Xiaomi, Nike, Adidas, Durex, Laoganma, etc., have enough self-generated traffic to contend with platforms, giving more brand owners hope and a good example; social e-commerce is springing up, WeChat mini-programs, Douyin's strong sales capability, community micro-business, and Luoji Thinking-style micro-business will all be gravediggers for platform e-commerce. Watch him rise a tall building, watch him entertain guests, watch his building collapse. The seemingly powerful platforms are already tottering, waiting for a signal to turn everything into soldiers. The good days of platforms are coming to an end. Professional distributors who adapt to market changes can be reborn from the ashes. Only the prosperity of middlemen can bring prosperity to the market economy. Source: Lao Miao Tears Marketing (ID: yiheyingxiao) Registration channel is now open. Long press the QR code below or click "Read Original" to register. The opening course is limited to 100 seats, first come, first served! Click here to register in one click.