Rebirth of the Entrepreneurship Era

Vol 2 Chapter 229: Sunk costs

Many people look at problems one-sidedly.

For example, when I saw a good business in a store, I felt that the boss must have made a lot of money. In fact, it is very likely that this store has just protected the capital, and may not even make ends meet.

For another example, when you see a purchase price of fifty cents and sell one for five, you feel that your boss has a horrible profit of 200%.

In fact, all businesses have a lot of sunk costs.

Why are there not many video sites, and most of them die halfway?

It is because the bandwidth cost of the video website is almost incredible. The bandwidth is not broadband, not the one hundred million broadband that the user's home opens, the five hundred trillion broadband, the bandwidth is the total amount of data transmission of the server per unit time.

Is equivalent to the main water supply pipeline of a community.

If there are only one thousand households in the community, and the peak water consumption is 50 ml per second per household, the carrying capacity of the water supply pipeline cannot be less than 50,000 ml per second, that is, 50 liters of water per second.

If the supply capacity is higher than this number, then there is no problem, but if it is lower than this number, all users ’water consumption will be affected, and there will be little water output, slow water output, and unstable water output.

This is the same as the website card.

Sometimes, your own Internet speed is very fast, but when you visit a website or an APP, you are stuck.

At this time, don't think that there is a problem with your network or router. It is most likely that the water supply line there exceeds the carrying capacity. Rao is that your home's pipeline can enter one ton of water per second, and the other party can divide it into your hands. Only one drop per second, then you can only stare dryly.

Therefore, if a website wants to provide stable service and experience, it must ensure that its bandwidth is greater than the needs of users.

If it is one MB of bandwidth, it means that the server can transmit one MB of data in one second.

If it is a fiction website, and users visit a text-based page, the per capita bandwidth occupancy per second may be a few KB. Therefore, 1 MB of bandwidth can carry hundreds of people.

However, if it is a video website, a user may occupy 1MB in one second, and one million people, the bandwidth requirement is about 1TB, that is, the bandwidth must support the transmission of 1024G of data in one second.

The cost is so high that it is beyond imagination, and it costs 20-30 million less a month.

Switching to sites like Youku and iQiyi has higher bandwidth costs.

Iqiyi's financial report shows that since 2018, their annual cost of bandwidth has exceeded 2 billion yuan, and is still increasing.

Besides the bandwidth cost of 2 billion RMB, it also has to bear the cost of content purchase and production of 4-5 billion or more. Coupled with operating a huge team, the cost may be several tens of billions a year.

Most of the tens of billions of costs are sunk costs. Like a bridge across the sea, tens of hundreds of meters of pier are sunk in the sea water. Most people ignore the engineering cost under the sea water.

Like people who do n’t understand the Internet, they may not even see the huge sunk costs behind video sites like iQiyi. Instead, they would scold the street because of the need to pay for member content. They feel that such a company has too little conscience. Laozi watched a play on your platform, and you let Laozi become a member.

In fact, the sunk cost of the Internet industry is much higher than ordinary people imagine.

Otherwise, how could Wang Sicong's Panda die?

Ordinary people look at Panda's business model, and they may not even think how this thing might lose money.

Wang Sicong comes with traffic, so advertising costs can save a lot of money;

The income of the anchor should be divided with the platform. When the anchor earns fifty cents, the platform also earns at least fifty cents;

A small number of big coffee heads need a high signing fee, but most big coffees not only bring their own traffic, but also can drive user consumption, so the overall platform will not lose, or not much loss.

Why is a big company so cool?

It is because the cost of bandwidth is tens of millions a month, hundreds of millions a year, and it is losing money every year. It is so bad that we need to constantly find new capital to invest in blood supply. The entire large group of critically ill patients who live in the ICU are willing to invest once there is no capital It means that there is no plasma supply, and the heart will immediately stop beating.

The reason why Xu Yiyang told so many roommates so that they could understand the truth.

Millions, don't feel uncomfortable because you can see that the website advertisement can sell money, feel that you haven't brought them to play, and made a lot of money yourself.

In fact, this ghost thing, it is still early to make money. In the early stage, it was burning money until it was large enough.

Fortunately, everyone can understand this truth, and they all have a heart that knows gratitude.

Afterwards, Xu Yiyang received the address of the restaurant from the other party, and said to several people: "Let ’s go to this restaurant after class in the afternoon. Let ’s take a field inspection and take a look at how they taste. If the taste is good, the ingredients It ’s good and the environment is good, so I ’ll advertise it to him. If it ’s not good, I wo n’t receive this ad, so I wo n’t pit the user. ”

Xu Yiyang feels that doing a website is like training, and you must have a conscience.

A conscientious training institution, while making money, it will definitely do everything possible to make its students learn, and a non-conscientious training institution, only to make money, it is best not to come to class if you have paid the money;

A conscientious website, while advertising, should also consider for its own users.

Not to mention everything for their sake, at least not to harm it.

And a website without conscience, advertising is just about making money.

Even if he knew that a private hospital for cancer treatment, he might not even cure a cold, but as long as he gave more money, he would still recommend this hospital to cancer patients.

Even if he knows that a certain board game is pit money, it is possible to ruin the player pit, but as long as he gives more money, he will also advertise this game.

But Xu Yiyang will never let himself embark on this lucrative path.

Therefore, he feels that he must first go to this restaurant to see and try it, if it is really good, then recommend it to the users on the forum.

This year, not many people are willing to spend 30 yuan to eat a buffet. If they read the advertisement to try, most of them are couples dating, classmates dinner, or simply want to have a good meal, it is unlikely to just follow Just find a place to redeem a meal mentality.

If the restaurant is doing poorly in all aspects, it is not only causing a psychological gap, but also additional psychological damage.

……

After class in the afternoon, seven people came to the old John Western-style cafeteria near Jiaotong University. Xu Yiyang also specially brought the digital camera with low pixels.

From the outside, the restaurant is really large, and the decoration is relatively high-grade, the scale can accommodate at least 100 people to eat at the same time.

But it's almost six o'clock now, it's dinner, but the business in the shop is average.

Xu Yiyang counted through the window, and there were not many waiters for dinner.

In terms of the number of customers, this store rents one day with manual equipment depreciation, let alone a loss of one or two thousand.

A middle-aged man who looked like a restaurant manager saw seven college students at the door. He looked through the window and was very happy. He trot all the way out and smiled and said, "Several, do you want to eat? Can you try?" Try our buffet, Orleans roasted chicken wings and fried chicken ... "

Xu Yiyang said with a smile: "Sorry, we are from the New Century Forum. Let's find Manager Liu."

"I am! Are you Mr. Xu?" The other party hurriedly greeted with a smile, then suddenly disappointed, probably because they realized that seven of them were not customers who came to dinner.

Xu Yiyang smiled slightly and said, "Yes, I am the person in charge of the website."

Said, he said again: "Actually, we came here to try the food here, if the overall is good, we will take your advertisement."

The other party immediately said, "Come and come inside, please treat me today."

Xu Yiyang laughed: "No, we will pay for it today."

Entered the store, Xu Yiyang went to the bar to pay the money first, that Manager Liu was going to stop, but Xu Yiyang had already handed out exactly 210 yuan to the cashier.

Manager Liu said embarrassedly: "Look at you, how can you even pay for your own meals when you come to the store?"

Xu Yiyang said with a smile: "If we cooperate happily, you can invite us to eat again."

Said, Xu Yiyang said again: "Manager Liu, please go ahead first, don't worry about us."

The manager Liu said quickly: "That line, the meal-taking area and the fruit-drinking area are all inside. You can do it yourself!"

Xu Yiyang selected a large table, and then he greeted everyone to take a meal. What surprised him was that none of the six people had eaten the buffet, and they did n’t know how to follow the flow.

So Xu Yiyang said: "The buffet is to eat and drink casually. Everyone goes directly over there. When you see what you want to eat, you can take a plate and everything can be done. ~ Www.novelmtl.com ~ Eat, but do n’t waste it. You can take a little less first, not enough. "

Chen Meng asked: "Brother Xu, just take it casually?"

Xu Yiyang nodded: "What to eat and what to eat!"

"Good!" A few boys burst out.

This restaurant is mostly American fast food, a variety of chicken products are very complete, and there are pork chop, American barbecue, all kinds of pizza, sausages and bread, dessert.

In addition, the variety of fruits is also relatively rich, Xu Yiyang deliberately made a little bit of each, and found that they are quite fresh.

Beverages are all made from beverage machines, and the taste is no different from KFC and McDonald's, but it is normal to be lighter than the bottled ones.

Everyone took some food and piled it on the table, it seemed very rich. Xu Yiyang took a few photos specially, and then everyone began to wind up the clouds.

After tasting many kinds of food, Xu Yiyang felt that the taste of this restaurant was quite good, at least worth the price of thirty yuan.

As for why the business is not good, it may be because the publicity is not in place, or it may be because consumers have not seen the specific types in it, but they are simply scared away by the price and feel that the price of 30 yuan is too expensive. .

Therefore, at this time, it is necessary to make a more detailed advertisement on a powerful channel. Once consumers understand what these thirty yuan can be exchanged for, they will be willing to try it.

Thinking of this, Xu Yiyang decided to take over the advertisement of this restaurant and use it to try his hand to see how strong the transformation ability of the New Century Forum is.

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