Chapter 102: Suppressing Competitors, Expanding the Shangcheng Cashback Version

February 8th, the sixth day of the Lunar New Year.

A black BMW 750 pulled onto the Hefei-Xuzhou Expressway and sped off.

Wang Zihao sat in the driver's seat, in charge of driving.

Meng Jie leaned against the back row, binge-watching the latest hit drama "Palace: The Locked Heart, Jade," and after hearing two lines of "Erta's供养," Chen Yansen silently put in earplugs and lowered his head to scroll through the news.

"Mama Ali Baba and Yahoo's equity dispute escalates, relations between the two sides further deteriorate."

"Group-buying sites like Meituan, Lashou, and Nuomi are locked in fierce competition—who will laugh last?"

"Weibo's new user additions continue to climb in February; Yang Mi and Feng Shaofeng join, firmly holding the top spot in social media."

Chen Yansen squinted, thinking: once the first year of group-buying passes, the intensity of competition on this track will be nearly cutthroat. It looks like a fight between group-buying platforms, but in reality it's a game between the venture capital firms behind them.

To pull in new customers and merchants, every company pulled out all the stops, driving down service commission rates again and again—yours is 5%, mine is 4%, and well-capitalized sites even shouted the slogan of 3%.

Compared to the 10% of a decade-plus later, this can be called a conscientious fee.

Currently, the highest market share belongs to Lashou, followed by Nuomi, then Meituan, with Dianping fourth; 24quan, Gao Peng, and Wo Wo Net split the remaining forty percent of the market.

No one could have imagined that Meituan would become the ultimate winner of the Thousand-Group War.

"While the rivals haven't reacted yet, grab the group-buying business first."

Chen Yansen decided on the spot.

Mogu Street, Meilishuo, and Taofenba are all imitating Fox Taobao's Super Rebate model, yet they don't realize that Shangcheng cashback and search cashback are the other half of the moat for shopping-guide sites.

Thinking of this, Chen Yansen called Lin Chenfeng of Penguin Capital; after a brief exchange, the other party said in surprise: "Group-buying is already a service-flash-sale model—do you still want to take a cut from them?"

To put it bluntly, today's group-buying sites are all propped up by capital; a service fee under five points can't even cover operating costs, let alone the hefty ad-spending costs.

"If they can send money to Baidu, why can't they send money to me?"

Chen Yansen retorted.

At present, group-buying sites' external promotion relies mainly on search engines, portal sites, and ground pushes—especially keyword bidding ads. During the Thousand-Group War, Baidu raked in piles from ad fees alone.

After hearing this, Lin Chenfeng said with a smile: "I'll try reaching out to the head of Gao Peng's marketing department for you."

Gao Peng is a group-buying site jointly established by Penguin and Groupon; its offline business drew a large number of staff from QQ Group. Though just founded, its business expansion is lightning fast.

Penguin holds half the shares, and with Lin Chenfeng stepping in, the odds of pushing the partnership through are much greater.

Half an hour later, Gao Peng Net's marketing director Zheng Yun called back.

"How does Mr. Chen want to cooperate?" Zheng Yun asked politely.

"Two ways to cooperate—Shangcheng cashback and Super Rebate. I suggest Mr. Zheng try both." Chen Yansen answered briefly.

"But group-buying and e-commerce have different models. Products have very strong city attributes—for example, a hotpot group-buying package in Shanghai would see low purchase intent and scattered traffic from users in other regions…"

Zheng Yun looked at Fox Taobao's daily active users of over a million and was tempted, yet worried the results would be poor and waste the marketing department's manpower and budget.

"That's easy to solve. On one hand, we can pick group-buying packages from nationwide chain stores, like KFC, McDonald's, etc.; on the other hand, Fox Taobao can push products in a targeted way based on users' IPs."

Chen Yansen said without hesitation. In his view, these problems troubling Zheng Yun would have dozens of solutions a decade-plus later.

"Mr. Chen, great idea! I really take my hat off to you. Being able to link shopping-guide and group-buying—no wonder you got Fox Taobao to a 2.8-billion valuation in just half a year."

Zheng Yun praised without stint.

By rights, he, a marketing director with an O2O background, should have thought of this approach first, but his thinking was boxed in by shopping-guide e-commerce.

"As for the cooperation details, let's set up a group chat and talk it through slowly. Once it's nailed down, we'll discuss Shangcheng onboarding and the CPS interface."

Chen Yansen didn't waste words with him—a few sentences and the intent to cooperate was set.

Gao Peng had just completed its Series A funding, with a valuation of only 130 million USD—a far cry from Fox Taobao. Chen Yansen had Zhang Yifeng play matchmaker, so naturally they were only too eager.

After that, Chen Yansen pulled Song Yuncheng and Xiang Pengfei into the group; Zheng Yun also pulled in colleagues from marketing and tech. Both sides began discussing product selection, commissions, and new-customer rewards.

By the time Wang Zihao drove off the expressway and headed straight for Virtual City College, Chen Yansen and Zheng Yun had already locked in the flash-sale products.

KFC Family Bucket meal—commission 30%, release 20%, users get it at 20% off;

Kungfu Mushroom Chicken meal—commission 35%, release 25%, users get it at 25% off;

Dicos Gun Chicken Leg Burger—commission 25%, release 15%, users get it at 15% off;

Little Sheep Two-Person Enjoyment meal—commission 20%, release 12%, users get it at 12% off;

Product selection focused mainly on nationwide chain brands. Apart from the 3%–5% merchant commission, the remaining price difference was covered by Gao Peng Net.

So Gao Peng strictly limited the campaign inventory, kept subsidy costs at 8 million, and added a 40-yuan new-customer reward—almost betting all of February's ad budget.

Twenty minutes later, Wang Zihao parked the car at the entrance of the startup park.

Chen Yansen handed the luggage to Meng Jie, asking her to put it in 0418, and went upstairs himself.

"Brother Sen! Happy New Year!" Xiang Pengfei's eyes were like they had auto-aim—he could always spot Chen Yansen first.

"What's the backend attendance rate?" Chen Yansen walked into Room 206, patted Xiang Pengfei's shoulder, and asked casually.

"Only two are still on the train, expected this afternoon; the rest are all here." Xiang Pengfei replied.

"How long roughly to nail the CPS interface with Gao Peng Net?" Chen Yansen asked again.

"Technically it's about the same as a B2C platform—three to five days at the fastest. But since it's our first cooperation, order tracking and data caliber need to be unified." Xiang Pengfei thought for a moment and answered.

"Then add Hu Yun to the coordination group. Song Yuncheng is in charge of this project—any issues, go to her."

Chen Yansen instructed.

"Got it." Xiang Pengfei turned and went into the meeting room together, preparing for the upcoming group-buying cooperation.

Chen Yansen returned to his seat, turned on the computer, logged into the data backend, and first checked the website traffic recovery.

During Spring Festival, daily active users dropped below a million for three days; things improved after courier services resumed on the fifth day—yesterday's DAU was 1.09 million.

At that moment, Yuan Wei walked over with a serious face to remind him: "Brother Sen, there's merchant feedback—some merchants who joined Super Rebate have also signed up for brand flash-sale events on Mogu Street and Meilishuo."

"You and Yifeng hold a meeting with the merchant-recruiting team. Whoever brought the merchant is responsible. Warn them first; those who don't listen get blacklisted permanently—no more cooperation. Anyone on the recruiting side who doesn't handle it actively gets their monthly commission rate cut."

Chen Yansen was instantly on alert, realizing the seriousness of the problem, and immediately gave orders.

He had a first-mover advantage and would never give the imitators a chance.

If merchants want to go to Mogujie and Meilishuo to make up their numbers, he won't stop them, but if the commission rate, net price, and terms over there are the same as Fox Tao's, or even better, don't blame him for playing dirty.

"I'll handle it right away," Yuan Wei replied.

Chen Yansen gave a slight nod. He felt the pressure, but he wasn't flustered—the head effect in the e-commerce industry was extremely obvious.

Mogujie had just been founded, with daily active users under ten thousand; Meilishuo had been established less than two years, with daily active users only in the tens of thousands.

The reason merchants signed up was simply because neither platform charged a deposit nor a slot fee—pure commission model. Anyone who didn't sign up would be a fool.

Although it wasn't much of a threat to Fox Tao, Chen Yansen wouldn't let his guard down and give his rivals a chance to rise.

Not long after, Xiang Pengfei came back from his meeting.

"Pengfei, come here for a moment!" Chen Yansen waved him over.

"Sen-ge, what's up?" Xiang Pengfei asked, holding his laptop.

"Monitor the product pools of a few competing platforms. Use fuzzy title matching and ID matching. The moment you spot any product that has participated in our Super Return, send an email to notify the merchant acquisition team."

Chen Yansen arranged things in a leisurely, unhurried manner.

"What's the priority level?" Xiang Pengfei asked instinctively.

"P0, get it online ASAP," Chen Yansen said without hesitation.

That afternoon, the merchant acquisition team had one more task—flipping back and forth between several competing sites, terrified of seeing the merchants and products they were responsible for.

The big boss had spoken: for every three violating merchants caught in a month, the commission tier drops automatically one level. For example, on 500,000 in performance originally paying 5% commission, catch three merchants running promotions on competing sites and it drops straight to 4%; catch five and it drops to 3%.

Chen Yansen wasn't completely merciless either—first offense gets a warning, second offense gets blacklisted.

For a time, the merchant acquisition team was in a panic, and their tone when speaking to merchants turned stiff.

"Class monitor, the boss of Meilishuo @'d you on Weibo, cursing like crazy."

That evening, Xu Xingxing scooted over, holding up her phone.

"@FoxTaoCEO Chen Yansen, young man, don't be so overbearing in business! Merchants can only join Fox Tao's Super Return, not Meilishuo's Brand Flash Sale—are you trying to create a monopoly!"

Meilishuo's boss Xu Yi called him out by name and cursed.

Thanks to his identity as a college freshman, the 2.8 billion valuation, and the title of business genius, Chen Yansen's Weibo followers had climbed to 4.8 million. Xu Yi's @ instantly drew in a swarm of onlookers.

That afternoon, over twenty merchants broke their contracts on the spot, refusing to join Meilishuo's Brand Flash Sale. After inquiring around, Xu Yi learned that Fox Tao was playing the "pick one of two" game.

Merchants had to choose one—either Fox Tao, or Meilishuo.

The sales data on the two sides differed vastly; merchants quickly made their choice, terrified of offending Fox Tao.

"@MeilishuoXu Yi, being older means you can bully people? Your company copied the UI style and gameplay of Super Return one-to-one—when are you paying the copyright fees?"

Chen Yansen hadn't wanted to respond, but this Xu Yi kept desperately riding the hype, so he fired back.

The design team posted side-by-side UI comparison shots of the two sites in the comments—who copied whom was plain as day.

"@MeilishuoXu Yi, Boss Xu, come out and explain—color scheme, font size, layout, all identical. Just a coincidence?"

"Bah! What shamelessness!"

"This is the thief crying 'stop, thief!'"

The wind shifted instantly. Netizens who had originally thought Chen Yansen overbearing now turned sympathetic toward Fox Tao.

Xu Yi was cursed into the ground, and the episode finally ended with him deleting the Weibo post and closing comments.

Mogujie's situation was about the same—barely any merchants willing to sign up.

The merchant acquisition team spent enormous effort to drag in a few dozen white-label (no-name knockoff) brands, barely scraping together one Brand Flash Sale, with only a handful of buyers placing orders.

No fame, no promotional punch—users voted with their feet; everyone knew who to pick.

"Damn it! This kid doesn't play by the rules!"

Xu Yi slammed his desk hard in his office, but there was nothing he could do.

When merchants ran a Phase-one brand group event on Fox Tao, sales could hit 500,000 to 1,000,000, while on Meilishuo, they'd be lucky to sell thirty or forty thousand, and they'd need site-wide traffic driving.

After venting for a while, he told the merchant acquisition lead: "First, pick up the merchants Fox Tao doesn't want, and get the platform's traffic going before we talk about anything else."

……

……

The next morning, Chen Yansen had just arrived at the second floor of the startup park.

He saw a few people in sharp suits sitting in the meeting room, with Song Yuncheng and another business associate from the Key Account Business Department receiving them.

"Sen-ge, they're from eLong Travel—probably here to discuss moving into Shangcheng."

Wang Zihao, noticing Chen Yansen had glanced over, explained with a smile.

Chen Yansen smiled, thinking: this is the benefit of having a reputation. In the past, negotiating B2C partnerships meant running around finding channels himself, and if unlucky, running into idiots like Zhang Hanhua.

Now it was great—sitting at home, people came to him seeking cooperation.

The Shangcheng rebate piece involved vertical sites for beauty and personal care, maternal and infant toys, digital products and books, plus brand self-operated, travel ticketing, and group-buying businesses.

Once the ecosystem was fully fleshed out, whenever users thought of discounts, they'd instinctively open Fox Tao—contributing both gross profit and user stickiness.

There were at least twenty or thirty thousand such sites in the country. Even if he only closed 10% of them, Chen Yansen would rake in seven or eight hundred million just from deposits.

A week later, eLong Travel officially joined Fox Tao Shangcheng's travel ticketing segment under the rebate program, and a brand group event would be held at month's end.

The project team was busy onboarding B2C malls and increasing the daily number of new brand group listings, while Chen Yansen quietly established a new company—Senlian Capital.

He placed the equity stakes of Fox Tao, Miha You, and Yunsu Express all under the new company's name.

(End of chapter)