The cultural and tourism industry ultimately did not escape internal competition. On the one hand, the competition for market share is intensifying, and cultural and tourism enterprises are constantly increasing their price competition; On the other hand, product homogenization is severe, causing consumers to experience choice fatigue in terms of scenic area style, commemorative surroundings, and hotel services.
During the third quarter financial reporting season of cultural and tourism enterprises, we are trying to find a more benign business model that avoids internal conflicts. In the rapidly recovering hotel industry, Yaduo's performance can be described as impressive. Q3 revenue was 1.899 billion yuan, a year-on-year increase of 46.7%; After adjustment, the net profit was 384 million yuan, a year-on-year increase of 41.2%, with both revenue and profit growth.
According to data from the Ministry of Culture and Tourism, the number of domestic tourists traveling in the third quarter was 1.512 billion, a year-on-year increase of 17.2%. The cumulative total expenditure of domestic tourists traveling in the first three quarters was 4.35 trillion yuan, a year-on-year increase of 17.9%. How to transform the industry opportunity window into a competitive opportunity for enterprises?
It is not difficult to find that the best way to get rid of internal friction is through differentiation when dismantling Yaduo's financial report. The key to the long-term existence of structural opportunities lies in whether they can be keenly captured and effectively grasped.
Anti inertia thinking: finding differentiation opportunities
In recent years, the hotel industry has shown a clear trend of differentiation. On the one hand, the era of "lying down and winning" for traditional full-service international hotels is gradually fading away, and brand premiums have decreased to varying degrees. On the other hand, Chinese domestic chain hotel brands have further broken through in the mid to high end market, with better overall growth.
If we look back at 10 years ago, the domestic hotel industry was still in a "dumbbell shaped structure", with luxury five-star hotels on one end and economy hotels on the other, with large ends and small middle. The mid to high end hotels located in the middle are almost blank.
From the perspective of habitual thinking, more than 10 years ago, before the rise of the new middle class and the dawn of new consumption, the mid to high end market may not necessarily be a deterministic business. If we look at it from the perspective of anti inertia thinking, there are structural opportunities in mid to high end hotels, which are deterministic opportunities that cannot be ignored.
After years of layout, Yaduo has formed a hotel network with mid to high end products as its main focus. And the expansion of hotel networks continues to accelerate, with 140 new hotels opening in the third quarter, a year-on-year increase of 72.8%, and 732 projects waiting to be developed in the pipeline, indicating sufficient project reserves. In the foreseeable next 1-2 years, there will still be strong scale expansion.
The hotel industry has undergone hundreds or even thousands of years of evolution, forming a relatively stable operating model and cyclical pattern. Especially in the mid to high end market, consumers' demand for high-quality accommodation experiences has always existed and remains stable. This stability enables the mid to high end hotel industry to have strong resilience against economic fluctuations.
Unlike disposable consumer goods, consumers in mid to high end hotels often have a higher repurchase rate. Taking business travelers as an example, consumers frequently travel between different cities due to work needs and have a high demand for hotel accommodation. Therefore, once a hotel brand can provide a satisfactory accommodation experience, consumers often form a long-term dependence.
So, how did Ado establish long-term dependence?
Cultivating endogenous energy: building a brand dependent closed loop
In Yaduo's financial report, you can see an interesting data. A deep sleep memory pillow PRO2.0, which was launched in July this year, sold over 800000 units in just over four months. Up to now, Yaduo has formed a two-way synergy between "hotel" and "retail".
If we continue to dig deeper into the connection between selling pillows and opening hotels, we will come to an intersection scene - sleep.
According to a survey by the Chinese Sleep Research Association, the incidence of insomnia in adults is as high as 38.2%. This means that one in every three adults is tossing and turning for sleep.
Yaduo draws a circle with "hotel+retail" to make consumers accustomed to the sleep experience within the circle. Accustomed to using Ado's pillow, familiar with the sleep experience brought by Ado, and then repeatedly choosing Ado's hotel during business trips, ultimately establishing a long-term dependence on Ado in terms of sleep.
If the pillow is a drainage "hook", then the key to consumers' long-term sedimentation in the Yaduo ecosystem is more reflected in the three-dimensional scene and multi sensory experience polishing of the hotel.
At the beginning of its establishment, each generation of its hotel products focused on creating a sleeping atmosphere. Whether it's just the right amount of lighting, "Zhuju" books, "Sahe" fragrances, as well as the flow of the guest room and the configuration of the shower, they are all guiding consumers into a relaxed and calm state.
These reflections on emotional value are also reflected in the hotel premium of Ato. In the third quarter, its ADR (Average Daily Rate) reached 456 yuan, which is at a relatively high level among hotels of the same class.
For consumers, once a long-term dependence is formed and a consumer mentality of "Ado=Good Sleep" is established, it will be difficult for other products and services to be compatible with it. As a result, the hotel and retail sectors have achieved two-way support and drainage, and have shown a sector rotation effect.
At the beginning of the retail business, hotel traffic diversion was relatively obvious. Consumers who enjoy high-quality sleep products in hotels often have a willingness to purchase, extending the hotel's sleep experience to their homes.
With the accelerated development of retail business, the support of retail for hotels is becoming apparent. When consumers use Ado products at home, they will have a deeper trust and dependence on the Ado brand. When faced with accommodation choices next time, it often translates into a preference for the Ato Hotel.
Once the rotation of sectors and two-way support are established, it brings an endogenous energy source for the brand.
Satisfying True Needs: Running a Business Model Without Internal Friction
The premise for hotels and retail to achieve bidirectional flow is precise and matching of traffic.
Whether it's the service touchpoints of hotels or retail products such as pillows and bedding, Yaduo's core scene is very focused on sleep.
Once the scene is focused, endogenous traffic becomes more precise. The improvement of traffic accuracy will inevitably drive the improvement of traffic efficiency.
That's also why the "Hotel+" model has been around for so many years, and only Yaduo has emerged. 'Hotel+Retail' is not just a combination of different business segments, but more importantly, it can generate precise traffic that can flow between segments.
Without an endogenous energy source, "Hotel+" would be like a tree without water. On the contrary, a brand with an endogenous energy source is like a precision operating celestial body, steadily revolving around its own value core, and able to achieve self consistency in operation, revenue, culture, and other aspects, forming a business model that is not internally consuming.
As for Yaduo, the ultimate goal of this' value core 'is to find the true needs and satisfy them.
High quality sleep is an irresistible and instinctive need for users.
Essentially, being able to approach real needs more deeply and comprehensively is the internal driving force for brands to cross the cycle. According to financial reports, as of the end of the third quarter of 2024, the number of registered members of Yaduo has exceeded 83 million. 140 new hotels opened in a single quarter, and hotel investors have a strong willingness to join.
Yaduo is on a positive cycle path from meeting real needs, expanding scene ecology, and benefiting hotel investors to achieve more efficient user conversion.
Brand building and business management are never about dealing with cold numbers, but about paying attention to real individuals. Seeing people's needs, putting people first, and forming a non internal consumption, positive cycle business model is just a natural result.