No company fails because of marketing failure. The failure of a company is essentially due to the failure of its products.
By Duan Yongping
Source: Tiger olfactory network
This article is about the exchange and sharing between Duan Yongping and Chinese students on Stanford campus in 2018. Duan Yongping is a big man behind the scenes of Bugao, oppo and vivo, as well as the mentor and early investor of pinduoduo Huang Zheng.
In the dialogue, he revealed his “secret of success”: there is a “stop doing list”. It is more important to do something or not to do something wrong than to do something right. Duan Yongping still expressed his optimistic view of apple, and said bluntly that “cost performance is an excuse for poor performance”. As for Tesla, Duan Yongping also said directly from the perspective of investment: Tesla is a company with zero value and will be finished sooner or later.
The following is the transcript of the exchange:
What is the most important thing for you? Why?
Duan Yongping: different ages have different answers. Now it’s family, family and friendship. Do you need to say why?
2. Without sales department, what is your price decision mechanism?
Duan Yongping: do market research, set the price as much as possible when listing, and adjust in time if it is wrong. The essence of (electronic products) competition lies in product differentiation and doing what others can’t provide. If there is no differentiation, it becomes a basic commodity for daily use. It can only compete by price and it is difficult to make money.
Have you ever tried to change your character and way of thinking?
Duan Yongping: I don’t think so. It’s hard to change my character. According to the statistics of China and Europe, CEOs of the world’s top 500 have all kinds of personalities, but they have only one common feature, that is, integrity.
4. How should Chinese private enterprises cope with the challenge of trade war?
Duan Yongping: the most important thing is that it depends on the enterprise itself. It doesn’t matter whether there is a trade war or not. Many enterprises that do not do well will take the trade war as a cover up. A good enterprise is an opportunity when the crisis comes. We don’t borrow, we have plenty of cash flow, so every crisis is an opportunity.
5. What is the logic of investing in early enterprises?
Duan Yongping: I don’t invest in the early stage, I only invest in listed companies. I vote for Huang Zheng for personal reasons. He is my friend. I know him and believe him. Huang Zheng is a rare and intelligent person I know. He pays attention to the essence of things.
6. Talk about marketing methodology?
Duan Yongping: (outside) there is a misunderstanding that we attach great importance to marketing. In fact, for us, marketing is not important at all. The most important thing is the product. No company fails because of marketing failure. The failure of a company is essentially due to the failure of its products. Of course, I’m not saying that we don’t want marketing. In fact, we do a good job in marketing. Marketing is to spread the information you want to spread (to your users) in the simplest language.
I want to emphasize here that marketing is not the essence, the essence is the product. The most important thing about marketing is not to talk nonsense. Corporate culture is the most important. Advertising can only affect 20% of the people at most, and the remaining 80% are affected by these 20%. If the marketing is not good, at most, it will sell slowly. However, as long as the product is good, no matter whether the marketing is good or not, the result will be the same after 20 years.
7. What are the opportunities for Chinese brands in emerging market countries?
Duan Yongping: I don’t understand this, but I don’t think there will be too much difference. We should pay attention to the needs of users. Ordinary mind is to return to the origin of things.
8. What happened to Warren Buffet’s dinner?
Duan Yongping: I do public welfare, Lao BA (Buffett) also do public welfare. I donated directly. It was the same as donating through Laoba, so I photographed buffet’s lunch, which was only used as public welfare and could learn from Laoba. You don’t have to eat. Just watch the videos, speeches and shareholder letters of Laoba on the Internet. Lao BA’s things are logical and sound like music.
9. There are two modes of mobile phone (enterprise). One is Xiaomi, which first circles users and then cashes in other ways; the other is apple, which makes money on its products. Which is better?
Duan Yongping: first of all, from the perspective of customer circle, apple is better than Xiaomi; secondly, in the long run, no enterprise can make money by cheap. Cost performance is all about making excuses for yourself. We must focus on users. It is not that we have to be high-end or low-end. We just do what we can to meet the needs of some people. Even apple doesn’t satisfy everyone.
In the early years, we often raised the cost performance ratio, until I once talked with a Japanese who is a Chinese expert about cooperation. When talking about the high cost performance of our products, the other party was puzzled and asked, “what is the cost performance ratio? Is it the” sex price “ratio? I was stunned at that time. It seemed that there was no such thing as cost performance in Japanese dictionaries. Then it took me a long time to realize that “cost performance” is actually an excuse for poor performance. I hope our company won’t use this word anywhere.
10. Future investment / entrepreneurial trends?
Duan Yongping: this problem is a little difficult for me. Personally, I don’t care much about the cutting-edge things. I’m generally lagging behind. If I understand a good company, I can invest again. Companies like apple focus on cutting-edge things. What I do is find companies like apple.
11. Why Apple is the most successful mobile phone company?
Duan Yongping: apple is very rare. Focus is on what it does. Apple’s pursuit of profit is to make the best products. Apple’s culture is very strong. It has a strict “stop doing list”. It must satisfy users and make the best products. We don’t compare with apple, because some of the 1000 features are better than apple, which doesn’t mean anything. It’s like CBA Basketball can’t play NBA. It’s not bullshit to say that we know kung fu.
12. The relationship between social “stop doing list” and investment?
Duan Yongping: I’m anti social. I’m tired and time-consuming. In general social intercourse, there are too few friends. It seems that you know many people, but it is difficult to understand them deeply. I prefer to play when I have time. I invest only as a hobby. Average can beat S & P.
13. Why do you say “dare to be the first in the world, and the second in the world”?
Duan Yongping: all the masters dare to do better than others. The success of our company is not accidental. If we adhere to our “stop doing list”, we will gradually accumulate a good circle of partners and suppliers, which is very valuable in the long run.
Dare to be the world after, refers to the product category, because you guess the market demand is often difficult, but others have made the demand clear, you will be more sure to meet this demand. (daring to be the world’s second refers to the category of products, while the latter refers to the ability to do a good job in products. In other words, daring to be the world’s second refers to “doing the right thing”, while the latter refers to the ability to “do the right thing”)
14. Have you ever made any investment mistakes?
Duan Yongping: no investment mistakes, no speculation. (in fact, investment has been made, but the mistake is very small. I may not remember it at that time.) When speculating on Baidu, I was short squeeze and lost 100-200 million US dollars. I learn from Lao Ba: I can’t think of it. If I don’t touch it, I will surely miss a lot of good opportunities, but I promise to seize them all right. Investment follows Lao BA’s logic: first look at the business model and understand how enterprises make money. 95% of people invest in the market with focus, which means they don’t know how to invest. Be sure to focus on business. Companies want to make money.
15. When and why to sell apples?
Duan Yongping: good companies don’t need to sell!
16. After you came to the United States, how has the ability circle improved?
Duan Yongping: the ability circle is not to draw a circle on the ground with a golden cudgel, saying that you should stay inside and not go out. There are monsters outside. Ability circle is: be honest with yourself, know what you know, and don’t know what you don’t know. Have such an attitude, and if you can understand a thing, it is in my ability circle, otherwise it is not.
Apple’s 1 trillion market value? I never care about this. I only care about its ability to make money. Unless the company is willing to sell the target at a lower price, or it does not have the ability to change its price.
17. How do you think of the “hold on only hope” and “stop doing list”?
Duan Yongping: “stop doing list” means to do the right thing. If you know it is wrong, you should change it immediately. Entrepreneurship still applies. (that is, we must insist on the right things and correct the wrong things as soon as possible!) As for how to do the right thing, it is a method level, which can be solved by learning.
If you don’t know right or wrong, it’s hard to achieve anything in your life. The concept of right and wrong should be cultivated and adhered to by ourselves, and there is no shortcut. For example, smoking, many people do not quit because they don’t know it’s bad, but because they can’t resist short-term temptation.
18. Why not see the media?
Duan Yongping: I don’t want to give the public the impression that I am in charge of the company and rob the CEO of his sense of achievement. It’s very important not to take credit from them, because in fact, I haven’t been on the front line for more than 10 years. If I were still the CEO, the company might not be able to do so well.
19. How do you see the difference between the market environment of China and the United States on entrepreneurship?
Duan Yongping: the environment in the United States is better. It’s harder to be an enterprise in China. When you finish your own business, you have to do police, fire control and security. Trouble
20. You advocate no loan and no margin. What if you miss the opportunity?
Duan Yongping: loans and margin are faster to earn and faster to compensate. If you often walk by the river, you can’t wet your shoes. Once you wet your shoes, you’ll stay wet all your life. Why take this risk? (some opportunities will always be missed. It is enough to make sure that what is grasped is right.) Most of our competitors in the past have disappeared and we are still alive. That’s probably why.
21. What do you think of the smartphone shell industry?
Duan Yongping: I don’t understand. But I know that good things don’t need to be promoted. As soon as smart phones come out, they become popular. If you don’t catch users quickly when your products are launched, it is certainly not good enough. You must come back to think about your problems.
22. Suggestions for career development of new employees in the workplace?
Duan Yongping: do your job well, don’t jump around. Many people in silicon valley like to change jobs, but 30 years at Apple is better than jumping to most start-ups.
23. How to treat entrepreneurship?
Duan Yongping: if you don’t know what you’re doing, it’s impossible for investors to believe you. Huang Zheng is a little bit good. He will keep asking what this means, what does this mean, and pay attention to the nature of the problem.
24. Corporate culture?
Duan Yongping: the corporate culture is mission, vision and core values. Why “mission” is established; “vision” is where we are going; “core values” is what is right and what is wrong.
Recruitment is divided into qualified person and suitable person. Fit refers to cultural matching, and qualification refers to ability. Those whose values don’t match should not. It is often the qualified but unsuitable people who make trouble for the company. A group of suitable ordinary people together can do great things together.
25. How do you think Chinese enterprises love overtaking on curves?
Duan Yongping: there is a saying in Alaska that shortcut is the fastest way to get lost There is no overtaking on a curve. It is most important to pay attention to the essence! Otherwise, even if it surpasses the past, it will be overtaken back.
26. How to judge whether the stock price is not cheap?
Duan Yongping: This is a question that the talents who pay attention to the market in the short term will ask. I don’t think about it. I focus on the long term and don’t touch what I don’t understand. Any practice of thinking about the market and timing may be wrong. I don’t look at the market, I look at the business. How do you know? 10 years ago, it was estimated that everything was expensive. You stand in 10 years to see now, can understand and cheap company, buy on the line.
27. How to understand “stop doing list”?
Duan Yongping: the main thing is to do the right thing. It’s not a skill or formula, but a way of thinking: if you find something wrong, stop it immediately, because the cost is minimal at this time. I can’t tell you right or wrong, how to judge right and wrong, you should accumulate by yourself.
You should not cheat users or investors. Every word is a promise, which you should know. If you go to invest and say that there is no business, no skill, nothing, then go to your father. You have to have something to meet investors. If you don’t know what to do, how can investors believe you?
As for how to do things right, take time to develop skill sets. Stick to the “stop doing list”. You can save a lot. Compared with apple, oppo is the same in doing the right thing, but there may be some gap in doing the right thing. But we have accumulated. We are better than most companies.
There is no shortcut to “stop doing list”. You have to accumulate, accumulate and realize by yourself. Stop doing means that if you find a mistake, you have to stop it. The effect is obvious after a long time. A lot of people couldn’t let go of the temptation, and they were still there 30 years later. If you are wrong, you must stop and resist short-term temptation.
28. How to bring children better in Silicon Valley?
Duan Yongping: the most important thing is to give children a sense of security. How? It is to give quality time, that is, to accompany them with high quality and to make friends with them. High quality company is to stay together and hide the mobile phone.
Love unconditionally. Chinese people are easy to conditional love, “you get the first, Dad loves you very much”, these two words can not be put together. Chinese people also like to boast that their children have won the first place, which is easy to put pressure on children. Children will think: I have to second, do you not love me? I take care of my children and insist on not saying “no” to them as far as possible. In addition to the big right and wrong and matters involving the boundary, the children are allowed to explore boldly.
29. What do you think of Laoba?
Duan Yongping: Lao Ba is a very good man. He is sincere and kind to people. He is very wise, any complex problem, he said a word or two to the essence. He is so wise, so successful and so kind to people. I haven’t seen such kind of entrepreneurs in China, and few entrepreneurs in the United States.
30. Why sell Netease?
Duan Yongping: because Ding Lei is a big boy, he is worried about putting so much money in his hand, although the share price proves that I may have sold it wrong.
31. What do you think of Tesla?
Duan Yongping: Munger said that musk is a proven genius, his IQ may be 190, but he thinks he is 250. But run a company, you must be rational. In my eyes, Tesla is a company with zero value and zero value, and it will be finished sooner or later. His culture is terrible.
32. How to build long-term friendship?
Duan Yongping: it means dealing with people sincerely. What I learned from Lao Ba is that friendship is the most important thing in one’s life. So be tolerant to your friends, friendly and honest. But he didn’t say that he needed to have many friends. A dozen good friends would be enough.
33. How to inherit the culture?
The secret is that there is no choice for Duan Yongping. Because you can’t convince people who don’t believe you. People who don’t believe you, when you talk to him, his eyes are floating, you can see. And then we talk about it year by year, month by month, every day, and eliminate the inappropriate ones by years.
How to select people, including partners and employees?
Duan Yongping: it’s luck to find the right one time. The main thing is to have standards, to eliminate, to break up. Know wrong, have the courage to stop. The earlier you stop, the less it costs.
35. Your “stop doing list” as an example.
Duan Yongping: what I think is not in front of me. I studied radio, but I didn’t do it because it’s not something I love to do. The job that graduate student looked for at that year said how many years you can be a director, two years can be divided into houses, chicken, duck and fish score. But I’m not interested. So I left. Later I went to Foshan radio No.8 factory. At that time, the company with only a few hundred people recruited 100 undergraduates and 50 graduate students. Everyone is not satisfied, many people want to go. As a result, two years after I left, little overlord was made. When I went back, I found that the gang were still there (only one left).
Many people say, “I didn’t find a better opportunity.” in fact, they didn’t have the courage to stop doing the wrong thing. So stop doing means that if you find something wrong, you should stop immediately. Otherwise, you may still stay in the bad place after two years. I’ve been thinking about long-term things. A lot of people are spinning around in front of their interests, and they will be there in 30 years.
36. American misunderstanding of China?
Duan Yongping: Americans have a good understanding of China as a whole. I support political right because if you’re not even politically correct, how can you be right? At present, the president of the United States is very confusing to me, but I believe it will be better in the end.
37. What is the most important thing about investment?
Duan Yongping: right business, right people, right price. (right business, right person, right price. This is what Lao Ba said.) Right business means business model, right person refers to corporate culture. Price is not so important, business and people are the most important. Culture has a lot to do with founder. Business model is the way to make money. You have to understand it by yourself. I can’t tell you. It’s like if you don’t play golf, I can’t tell you the fun of it.
38. How to persist in starting a business?
Duan Yongping: my understanding is very simple. If you can’t stick to it, you can’t. What you insist on is something you can’t put down. You will know it by then.
39. What about bitcoin / blockchain?
Duan Yongping: I’m not interested in things that don’t generate cash flow. I don’t understand the blockchain. I don’t understand it. I don’t understand it. I can’t make heavy bets if I don’t understand it. But I can’t understand, it doesn’t mean you can’t understand, you have to vote what you can understand.
40. How to find and keep a normal mind?
Duan Yongping: it’s not difficult to keep it, because it’s there. However, Ma Yun also said, “it is difficult for ordinary people to have a normal heart, so ordinary heart is also abnormal heart!” If you find out, you’ll lose. Because if you don’t have a normal mind, rational will fall flat.
41. How to find what you like to do?
Duan Yongping: if you always stay where you don’t like, you may never know what you really like. So if you find something wrong, stop. Try and find. Do what you like, there is no concept of overtime, because you will try your best to work.
42. I think failure is inevitable and success is accidental, right?
Duan Yongping: there must be a reason for success.
43. If I had the chance to live again, what would have been different?
Duan Yongping: I don’t know. I didn’t think about it like that. Maybe drink less red wine?
44. What do you want to say to your son?
Duan Yongping: it’s useless to say anything. What is important is what you do. (this is what Lao Ba said)
45. How to find the right / wrong thing?
Duan Yongping: have time to think about it. May think for a long time, one day suddenly a flash of light, want to understand is wrong / right. At that time, we thought about the ad words of XIAOBAWANG, and we thought about it for half a year before we thought about the word. Many people are busy all day and have no time to think about it and may never understand it.
46. Is there a big crisis in China?
Duan Yongping: some people also asked me on wechat whether there would be turbulence or not. I said I thought we were in turmoil all the time. I think we always have a crisis, some people are in danger, there are man-machine, just be good at ourselves.
47. What about trade war?
Duan Yongping: if you look at it for 10 years, it will surely be over. If there is a real problem in the stock market, apple must be more powerful if it has so much cash, so it is better to buy a good company at this time.
48. How did you find the mission of your company’s products?
Duan Yongping: product angle, is slowly groping out, found wrong, quickly stop. For example, Apple’s charger has been said for a year, but it hasn’t come out this year. They didn’t push it out. There must be a problem that hasn’t been solved. Don’t push until it’s solved.
49. Men are afraid of going into the wrong business. Which one will be popular in the future, what are you good at, what do you like?
Duan Yongping: if you know: will fire + be good at + like, then certainly do that line. The problem is that it’s hard to know, so give priority to what you like. More money is not a good thing, because making money is a great pleasure. If you have more money, you will lose a very important pleasure. Money is almost enough. It’s more important to do what you like.
50. Is FDA certification of Apple watch ECG valuable?
Duan Yongping: of course. First of all, it can attract people’s attention and let people know. Secondly, doctors will admit it only when they have certification.
51. The next breakthrough of human computer interaction?
Duan Yongping: I don’t know. But the machine must be stronger and stronger. People have already lost in go, and you can’t beat the machine in speculation. But in investment, machines can never beat people, because machines can’t understand companies.
How to give different pricing to customers?
Duan Yongping: the prices are inconsistent. First, they will find out sooner or later. Second, when customers find that they can negotiate, they will try their best to bargain with you, wasting a lot of your time. All these are troublesome matters. The same price will save a lot of trouble. Do products is to seize the needs of customers, not the price. Take a look at John Leahy of Airbus. (one man beat Boeing! Of course, the product is still behind it
53. What’s Huang Zheng’s advantage that makes you vote for him?