In late April this year, Lianjia officially announced to upgrade to Shell Housing, providing consumers with second-hand homes, new homes, rental and other services. Peng Yongdong, CEO of Lianjia, once said in a Letter to Partners from CEO of Shell Zhaofang that Shell Zhaofang would take the lead in upgrading to an industrial platform in the areas of renting and buying houses, which indicates that Lianjia has started its own transformation.
Some people may ask, what does shell house search mean for Lianjia? Why would Homelink launch shell housing search on the basis of the original perfect system of homelink? According to the official website, on the one hand, Shell House is a collection of Subsidiary companies of Lianjia and a carrier of “platformization” and “Internetization” of all of Lianjia’s businesses. On the other hand, Lianjia wants to build an open platform for the real estate industry to empower the real estate agency industry while establishing its own enterprise database.
From the above point of view, the importance of shell housing for the chain is self-evident, the chain home launched shell housing is not difficult to understand the move. But some people will wonder why Lianjia chose to upgrade from this year alone? Not later, or before? You should know that Lianjia has long wanted to be a technology-driven real estate Internet intermediary, rather than just a traditional real estate intermediary. There must be a point at which the Linkers make this change.
Real estate agent winter arrival, lianjia eager to survive?
“I thought the market would turn bad, but I didn’t think it would come so quickly and force us to change.” This is what Mo Tianquan, chairman of Soufun, said in the second half of 2017, reflecting that the real estate market where Lianjia is located has not been easy in the past two years.
In 2017, Lianjia experienced a slump in the second-hand housing market in Beijing and Shanghai. The second-hand housing transaction volume of Lianjia in Beijing dropped 51% year on year. In Shanghai, the monthly transaction volume of Lianjia in 2017 was only about 10,000 units. The declines in Shanghai and Beijing, which have been two key cities supporting Transaction volumes for Lianjia, say a lot about the potential for trouble elsewhere. According to industry estimates, the second-hand housing market monthly turnover of 15,000 sets is the watershed of profit and loss, and the larger the scale, the more losses.
As a matter of fact, since 2016, the real estate agency industry where Lianjia is located has been affected by the real estate regulation policies introduced by the state, such as “destocking”, “shantytown renovation” and “property tax”, etc., all real estate agencies in the industry have started to see layoffs and shrinkage, shop closure and reduced transaction volume. Although these phenomena are normal market reactions, there is no need to panic, but for Lianjia, every loss of an offline store and every loss of a broker may be a big blow.
Yan Mi of Lianjia once said, “At present, how to improve the operation efficiency is a big problem faced by long-term rental apartment operators. The introduction of Shell House search can bring flow bonus to the subscribers on the one hand, and business upgrade to the participants on the other hand, and improve the efficiency of real estate transaction.” So, join the shell housing benefits. After all, there is no such thing as a free lunch. There must be a justifiable reason for Lianjia to give such benefits to the entrants. In fact, the long-term shell housing search in the above mode can help Lianjia realize the maintenance of real housing data. If this is the purpose, then the launch of shell housing can be seen as Homelink under the pressure of the industry to seek self-rescue measures.
Lianjia embraces third-party platform, real housing data is the ultimate goal?
If you want to ask where the core resources of Lianjia are, there is no doubt that the data of about 70 million real houses in China is the core of Lianjia, which is the blood for the operation of the ecosystem of Lianjia and also something that Lianjia often mentions in external speeches. As can be seen from the introduction of Lianjia’s official website, Lianjia has been involved in real estate transaction services, big data processing, asset management and other businesses, most of which are based on real estate data transaction. Therefore, if there is a problem with housing data, the consequences can be imagined.
The main body of real housing data screening can come from two aspects, either by yourself, or let someone else to help you complete the screening. For homelink, the main product of real housing, offline stores are the favorable guarantee of real housing of Homelink. After homelink put forward the concept of real housing at the beginning, its offline stores began to expand without stopping, so even when the industry is flooded with false housing information, Homelink can also have the confidence to put forward the concept of “real housing”. And with the reduction in the number of offline store in August 2017, HOME LINK start and which has 1800 stores, covering 54 cities of the 21st century real estate in China, to enter into negotiations for the joining cooperation, and in January this year, HOME LINK restart, on brand, to join the layout of the model, the visible HOME LINK joining mode for emphasis.
At present, the joining mode of lianjia can be divided into light joining and heavy joining. For some platforms, such as Lehu, Tongchuang, Chengjia, Gulfstream and other brand apartments, Homelink adopts the form of “quality alliance”, which can be understood as the mode of light franchise from another perspective. We sign a genuine agreement, and then you put your housing resources on my platform. However, for individual franchisees or even small and medium-sized intermediary platforms, Lianjia generally adopts the heavy franchise mode, which will intervene in the whole process from recruitment, training and management.
For example, In the second half of 2017, Lianjia encouraged its internal employees to join lianjia independently, and the franchisees should bear all the costs of the stores. At the same time, 10% of the turnover is paid to Lianjia as the franchise fee, and the staff of the franchisee is trained by Lianjia to ensure that the service of the franchise model is no different from its own direct operation model. These cases, to some extent, reflect lianjia’s desire to find the most cost-effective way to confirm real housing.
In fact, Lianjia knows very well that the severe vertical store model will occupy a large amount of capital, which will easily lead to difficulties in capital turnover when the business is in recession. However, Lianjia also understands that offline stores are the frontier for Lianjia to expand its territory and the most basic source of real housing data. Therefore, when offline stores are shrinking, the third-party platform will naturally become the best choice for Lianjia.
Hasty layout, the transformation of home chain is not smooth
According to the information released by Homelink, the launch of shell house hunting means that Homelink has been upgraded from a heavy vertical platform to an open platform in the industry, which is similar to the housing model of “Whole House Publishing Network” under 58 Group. 58.com, Ganji.com and Anjuke, together serve nearly one million brokers across the country. But in February this year, faced with an increase in port 58 fees, real estate agents formed a coalition and pulled listings to fight the increase.
The port is a platform for 58 home buyers to provide housing information promotion to real estate agents. After obtaining housing information, brokers will display housing information through the port, which is just like the shell housing search nowadays. Buyers and renters can search and read housing information on the platform. Such a mechanism was originally a mutually beneficial model, but with the coming of the winter of the industry and the pressure of the rising port fees, the real estate agency industry finally began to seek other ways.
Perhaps Homelink saw this opportunity and started to launch shell House search in March this year, which is enough to see the ability of Homelink to seize this opportunity. However, from the current interface of Shell Zhaofang, it is not very different from the previous lianjia, and Lianjia has not carried out publicity and promotion of it, which also shows that The layout of Shell Zhaofang by Lianjia is a little hasty, and also indicates that the road of transformation may not be smooth.
First, shell housing brand independence is difficult. It can be seen that Lianjia wants to seize the opportunity to act as another Internet real estate information platform. Lianjia once said that “In the near future, Shell Zhaofang will empower 100 agency brands, serve more than one million brokers, create a benign ecology of the residential industry, provide consumers with better living experience, and solve the service pain points of the entire industry”.
On both counts, shell House clearly moved 58.com’s cheese. On May 6, Yao published an article titled “Yao Jinbo answers Lei Jun: Who is 58 and why is 58 fighting?” The letter, this letter also indirectly responds to the outside world’s concern about how to deal with the attitude of housing shell. From this point of view, shell room in the brand independent process, hiding a strong opponent.
And for Shell House, brand independence needs a long process, in this process, a large amount of money to promote the essential. It is understood that Shell housing has been looking for Huang Xuan as a brand spokesperson, Huang Xuan as a male star, its advertising costs are naturally not low, which does not include the promotion costs of various channels. Therefore, when the industry is in recession, every time Lianjia invests a sum of money to promote the brand of Shell Zhaofang, it may be a potential financial burden.
Second, offline stores are still the main battlefield for Lianjia, which has been in transition. In fact, Lianjia can be regarded as an Internet intermediary platform for lianjia’s own business, and users can conduct transactions on lianjia. However, today’s real estate transactions are mostly offline, and online only plays a role in promoting users to understand their needs. AR, big data and other technologies can only help users to a certain extent, but cannot replace the role of brokers in a short time. As a matter of fact, Lianjia is quite clear about this industry rule, so we can see that a large number of offline stores are laid out on the basis of the original Lianjia.
According to Peng Yongdong, CEO of Lianjia, offline stores play a role of connecting brokers, landlords and tenants, and online stores cannot replace all offline stores. It is known that half of fangdd’s employees are still engaged in verification and transaction of offline housing sources, which indicates that offline is still the main battlefield of Lianjia. It may take a long time for Lianjia to realize the road of Internet intermediary platform.
There is a long way to go for Lianjia Internet intermediary
At present, not only Lianjia, but also most real estate agent players are fully aware of the importance of “Internet-based” platforms. For example, when I Love MY Family upgraded its products in January this year, it tried to bring Internet elements into its products. However, the transformation of Internet real estate agency is not a smooth road. For example, IUGV has cancelled more than 15 subsidiaries, Fangtian has readjusted its business structure, and Fangdd has cut off its financial department. Therefore, it can be imagined that lianjia must face a long road of transformation this time.
First of all, direct business model interests are challenged. According to The official statement of Lianjia, brokers of different brands can work together based on the rules of the platform to improve the efficiency of real estate transactions and reduce competition such as malicious bidding. Then the problem comes. When long-term rental apartments such as Rubik’s Cube, Meilu, Uke Yijia, Longhu Guanyu and You+ enter Shell House, it means that on the same platform, Lianjia will compete with these platforms. However, the direct operation mode of Lianjia has been mainly relying on the monopoly of housing resources to seize the right to speak the market price. If Lianjia opens its platform resources, it is obvious that over time, the cost performance will be the dominant factor, rather than the scale. Therefore, this challenge cannot be ignored.
Secondly, the real and false challenges of housing information. As a real estate information intermediary platform, the authenticity of housing information identification ability is indispensable. Although Lianjia has a lot of real housing data, with the further opening of the platform, there will be a large number of third-party institutions active on the platform, so the verification of authenticity of this part of the housing may be a big challenge for Lianjia in the future.
Third, intermediary platform jump single challenge. The Internet real estate intermediary mentioned by Lianjia actually belongs to O2O Internet information intermediary platform. Users and brokers connect through the platform, and then brokers and users conduct offline talks and transactions. Theoretically, mature buyers and sellers can bypass The platform of Lianjia to conduct transactions and move towards direct buying and selling services, which is a challenge lianjia must face after transforming into O2O Internet intermediary service platform.
Finally, there are many potential competitors. It is also said that Shell housing has moved the cheese of Anjuke, so anjuke will certainly not sit idle, and Alipay and JINGdong have entered the rental market, I Love my Family, Wheat field real estate and other large domestic real estate agencies are also trying to build their own platforms. Although the Internet real estate agent platform was once seen as a decline in the industry, since 2018, under the background of the national housing system to encourage both renting and purchasing, the rental market has ushered in another draught, under which the track will only become more and more crowded in the future.
Of course, after lianjia chooses this road, it faces more than these challenges. At present, how to make the head players recognize this system is very important, only a large number of industry head players to join, can be regarded as the open nature of the real estate industry platform. However, at present, each real estate agency platform more or less has its own O2O real estate closed loop transaction system. If it is attached to Shell Housing search, it will involve intermediary fees, platform data security and other issues. From these two aspects alone, many real estate agency platforms may not easily join shell search.
In general, there is a long way to go for Lianjia real Estate agency to become an Internet agent, and it may take a long time for Shell Zhaofang to achieve true brand independence. We wait and see what kind of product shell Zhaofang will become in the future.
Article/Liu Kuang public account, ID: Liukuang110