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Starting with NetEase, let’s look at the 8 ways Internet giants rent apartments.

There is another Internet giant entering the long-term rental apartment market from the front.

At the end of 2019, NetEase quietly purchased a piece of land in Shanghai, which can provide at least 659 rental housing units. There is another Internet giant entering the long-term rental apartment market from the front. What new opportunities will these business giants, who carry “huge traffic”, “numerous users” and “sufficient capital”, bring to long-term rental apartments? We might as well start with NetEase and take a look at the 10 ways that Internet giants rent apartments, and then analyze them one by one.

On 8 ways for giants to rent apartments

At the end of 2019, NetEase acquired a rental plot in Qingpu District in Shanghai for 99.42 million yuan. According to the relevant conditions for the construction of the plot, it is expected to provide at least 659 rental houses in the future. At this point, Baidu, Tencent, JD.com, Alibaba, and NetEase have all gathered in Changchang Rental Apartments to participate in various ways. Looking back at the entry of several other giants, we found that these companies have different "postures", with 8 different "postures".

① Direct purchase of leased land

At present, there are not many Internet companies that directly purchase leased land. On the one hand, it is related to the purchase conditions of previous leased land. On the other hand, purchasing properties is an asset-heavy behavior and will not be adopted by giants who are good at asset-light management operations. However, judging from the land purchased by NetEase, there is a piece of commercial land nearby, which also belongs to NetEase. When the relevant supporting construction can keep up, we can boldly try to self-sustain the land.

② Cooperate with long-term rental apartments to create offline sales scenarios

In 2018, Xiaomi entered into long-term rental apartments with its lifestyle shopping platform Xiaomi Youpin, and strategically cooperated with Country Garden's long-term rental apartment BIG + Bijia International Community to create "Bijia x Youpin" full-scenario living apartments. The 263 rooms in Dongguan Fangfang Creative Valley store are equipped with high-quality home products such as air-conditioning companions, smart home kits, and 8H latex mattresses as standard. Create experience scenarios and find entry points for Xiaomi Youpin’s offline sales.

③Invest in long-term rental apartment brands

Whether it is Ant Financial, which belongs to the Alibaba family, expressed its stance on the financing of Danke Apartment, or Tencent’s support for Ziroom’s US$4 billion financing, it has always been the way for Internet companies with “deep pockets” to show their “side” through investment and financing. Routine practice.

④Launched a housing rental platform

A company that must be mentioned here is Alibaba. As early as October 2016, Xianyu, a second-hand trading platform owned by Alibaba, launched a house rental function, where landlords can directly publish house rental information. Also in August 2017, it reached a strategic cooperation with the Hangzhou Municipal Government to create the country's first "smart housing rental platform". When Xianyu participated in Double Eleven for the first time in 2019, it launched the "Double Eleven Renewal Plan" in the rental sector to fully attract traffic. From the perspective of building a platform, among the current non-professional rental platform players, Ali has spent a lot of effort.

⑤ Launch rental financial products

This type of financial product is mainly rent installment product. Taking Baidu as an example, it has launched rental-related platforms including Baidu Rental Platform and Baidu Youqianhua Rental Installment Service, as well as Baidu Youqianhua and Renrente.com’s joint product “Rentale.com Wallet”. Looking back at Baidu's layout in the leasing field, it is not difficult to see that finding business scenarios that are consistent with its financial services may be its purpose.

⑥Enter the upstream and downstream of the industrial chain

In the "Jingpin Apartment" launched by JD.com in 2018, JD.com has positioned itself correctly as a "three landlords": using its own commodity capabilities, trading capabilities, decoration and design capabilities, etc., to decorate and upgrade the cooperative brand apartments , creating “JD quality” exclusive housing. In this way, there is no need to look for additional rental housing, and you can smoothly enter the industry chain related to long-term rental apartments. In addition, JD.com can also provide a traffic platform for cooperative brands, which can be said to be a win-win cooperation model.

⑦Soft penetration: resigned executives rent an apartment with the director

In recent years, more and more former Internet company executives have switched jobs to long-term rental apartments. For example, former Baidu Vice President Gu Guodong joined Danke in June 2019 and was appointed chief COO; Ziru CEO Xiong Lin, and Youkeyijia CEO Liu Xiang was born in the Internet. This type of talent is good at big data operations, opening up online and offline channels, and getting closer to clients.

⑧Export your own product system

Whether it is Tencent or Alibaba, they are constantly exporting their own credit construction system by entering the long-term rental apartment market. Alibaba has introduced a rental credit system in the rental platform launched in cooperation with the Hangzhou government. Tencent has also launched a credit system with Shenzhen Construction Rental Platform to continuously increase the frequency of use of all its product systems among C-end users.

Why do Internet giants want to be "tenants"?

Compared with the Internet's ability to turn mud into gold, the role of "renter" has always made many long-term rental apartment operators laugh at themselves. Some brands even said, "Long-term rental apartments should not make money." Things are complicated, from finding a property, carrying out renovations, acceptance standards, and post-service services, etc., the entire ecological cycle of long-term rental apartments begins to operate and cannot stop. Therefore, many brand owners have said helplessly, "I only make money selling cabbage with the intention of selling white powder."

And these are experiences that Internet giants have never had before. As experts in light asset operations, Internet giants are better at rationally coordinating various resources and reaching out to clients through online and offline channels to promote brands and complete services. When the online dividends of the mobile Internet have reached a ceiling, how to find suitable offline integration boundaries will most likely become the key to winning the next decade.

Real estate is inherently asset-heavy. Under the traditional path of “land acquisition, development, and sales”, the combination with the Internet is often the icing on the cake. In compliance with the trends of all parties, the long-term rental apartments that have emerged are more like an "alternative gene" growing out of the big tree of real estate.

It is characterized by focusing on operations and light assets, and its customer base is targeted at the young urban population, especially young people in first- and second-tier cities, which is highly consistent with the user groups that BAT desires. Observed from multiple dimensions, the operating gears of long-term rental apartments have many overlaps with the Internet. For this reason, long-term rental apartments attract more attention from Internet giants than traditional real estate businesses.

Three new trends in long-term rental apartments as giants enter the market

With the gradual penetration of Internet giants, what kind of impact will long-term rental apartments be affected? From the perspective of Maidian Space Leasing, it will mainly bring new trends from three aspects: smart space, capital and marketing methods.

First of all, more powerful smart apartment systems will likely appear in the future. What is the use of such a system? A person in the long-term rental apartment industry said this: Mainstream long-term rental apartments have a certain degree of intelligence, usually equipped with smart door locks, smart water and electricity meters and other equipment. These seem to be just bonus points, but in fact they form a fundamental difference in the operation and experience between current branded long-term rental apartments and ordinary rental houses.

Jack Ma also spoke at the 2018 Artificial Intelligence Conference and said: Companies that do not use intelligent technology will all enter the field of failure. When the management of long-term rental apartments has entered the rental 2.0 era in advance, "data will be the means of production, computing will be productivity, and the Internet will be the production relationship." Internet giants' artificial intelligence, especially their system construction capabilities, will enable future apartment management to become intelligent and unmanned.

Secondly, the sources of capital will be more diversified. Some people often refer to the companies invested by several major Internet giants as "xx Family Bucket". This is because the giants will use various methods to inject capital into the companies they are optimistic about, or assist in their mergers. This is good news for those regional brands that have certain advantages but lack funds for scale expansion. For brands that are at the forefront, have scale and product advantages, giants will be more favored.

Finally, all-round marketing penetration is needed to create brand effects. Internet giants' grasp of big data is one of the capabilities that makes many companies in other industries jealous. Once long-term rental apartment brands can gain access to this kind of data capabilities, their marketing will be more targeted and they will be able to better reach customers. As Tencent has opened a service window for Beike House Search on WeChat, it can be seen that the traffic effects and customers that such platforms can provide will not be easily replaced by other types of platform advertising.

Although NetEase's purchase of land for housing and leasing is just a small move by Internet giants, it is not difficult to see from the frequent actions of several giants in recent years that they are still interested in this market and intend to invest more resources in it, so Those who wish to speak ill of long-term rental apartments need not do so in vain. In 2020, what other actions will these giants take next? Come and look forward to it together.

Source: (Editor: hsadmin)