Focusing on your core business can promote business growth

A consumer walks past an advertisement for e-commerce platform Pinduoduo in a shopping mall in Shanghai. (Photo courtesy of China Daily)

In their recently released first-quarter financial reports, major domestic internet giants such as JD.com, Alibaba and Tencent reported revenue growth that exceeded market expectations.

In the early days of the development of the Internet, domestic enterprises learned about competition and scale expansion. Some Internet companies continued their offline development based on large-scale mergers and acquisitions and invested a lot of capital to create “flows” in financial, educational, healthcare, travel and other fields, which led to disorderly competition and expansion.

Pinduoduo, a popular e-commerce platform, overtook Alibaba, once considered the unshakable e-commerce leader in terms of market value, in November 2023, and Douyin, the Chinese version of the video-sharing platform TikTok, is expected to expand rapidly, posing a huge challenge to Tencent . Unlike other internet giants, Pinduoduo and Douyin focus on their core business and aim to expand their core business to overseas markets. Their core business focus strategy helped them gain an advantage over competitors obsessed with a diversified investment expansion strategy.

Pinduoduo upholds its principle of “preferential prices and good services”, which has helped it achieve rapid market development. At the same time, providing better services and consumer experiences has also helped attract new consumers while retaining old consumers. This has prompted Alibaba and JD.com to pay more attention to providing consumers with competitive prices and better customer experiences to consolidate their core businesses.

Businesses should move from scale expansion to a people-centric strategy that focuses on innovation, efficiency and quality. To pursue greater development, they should focus on foreign markets and rely on scientific and technological innovation. The era of “burning money” on development is over, and the era of truly testing the competitiveness of enterprises has come.

– BUSINESS HERALD OF THE 21st CENTURY