Baidu establishes LBS Division

Traditional search engine-based search services are challenged in the era of mobile Internet, and LBS (geographic-based services) will be another form of search. With the LBS service, the search target is more accurate and the effect is more direct. Therefore, it has obvious advantages over traditional search.

For example, when a user travels or travels in a foreign country and wants to find a hotel accommodation, if he uses a search box to find a hotel and enters the keyword “hotel”, most of the search results may not be suitable for the needs of the user at that time. However, if you use the LBS service to find a series of hotels that are closest to you, the search results will be much more accurate.

With the arrival of the mobile Internet era, more and more users are accustomed to acquiring services through mobile phones. The potential for LBS applications is huge. The traditional search giant Baidu is also actively deploying LBS. On October 17, Baidu announced the formal establishment of the LBS Business Unit. According to Baidu's introduction, the LBS business unit will use map products as a carrier to extend LBS services and promote the full penetration of smart living by providing multi-terminal and one-stop services. "Fully open, equal support and service, in the form of API calls," Baidu will provide developers and partners with free access to various data sources such as map data, traffic data, and satellite image data.

This means that the LBS service will become an important fulcrum for Baidu's mobile Internet strategy. Baidu did not replicate the PC-side business model on the mobile side, but instead launched business innovation in accordance with the characteristics of the mobile Internet. And jumped out of the traditional search form, opened another world.

From Online to Offline

Google, Baidu and other companies based on search engine search model so successful, that when it comes to search, the user first think of the search box, keywords and other concepts, in fact, this search is online search, which can cover the scope of limited. Many offline merchants, because of their small scale, have not established their own websites or launched online marketing so that search engines cannot capture relevant information and cannot be displayed in search results. Searching for future development trends is expanding from online to offline.

Sites that provide domestic services, such as the public comment network, have already implemented LBS services on mobile clients. According to statistics, as of the second quarter of 2012, the number of monthly active users in Public Reviews exceeded 48 million, and the number of reviews exceeded 20 million. The number of merchants included exceeds 1.5 million, covering more than 2,300 cities across the country. The monthly total page views was nearly 1 billion, of which the number of unique users of mobile clients will soon exceed 40 million, and the mobile client's monthly page views has exceeded the PC side.

It is not too early for Baidu to enter LBS at this time. However, relying on Baidu maps, Baidu layout LBS also has obvious advantages.

The newly-established LBS Business Unit is a spin-off of the original Baidu Maps business. It is understood that the number of Baidu map users exceeds 77 million, data cooperation with more than 40 merchants, and building a new marketing platform for more than 4,000 merchants. Based on this, Baidu can gather a large number of developers by establishing an LBS service platform, launch various APP applications, and serve businesses and users.

Sun Yunfeng, chief product architect of Baidu, introduced that Baidu's LBS business unit will improve the construction of Baidu's LBS cloud platform and deeply cover consumption depth information to restaurants, movie theaters, KTVs, shopping malls, hotels, public transportation, supermarkets, and park attractions. The independent APP satisfies the user's characteristic needs, and uses UGC and BGC methods to build the LBS ecosystem.

In fact, earlier, Baidu launched e-commerce services and has been expanding to the line. Baidu's “Yeah” e-commerce website was formally launched in October 2008. It operates the C2C e-commerce business, but by March 31st, 2011, Baidu’s C2C business has issued an adjustment announcement, saying that it will begin immediately. Ah business adjustment, one month after the date of release, there will be closure of goods, stores, and transaction-related functions of the shopping platform. The business of the shopping mall will be transferred to Lekuten and Yaodu 100 partners. Baidu has a few folds, indicating that Baidu’s expansion into offline is not going smoothly.

Insiders analyzed the reasons that for Baidu, search is Baidu's most important business, the company has a "721 strategy", Baidu will invest 70% of the company's resources in search, 20% of resources will be invested in search-related businesses, and 10% of resources. To invest in innovative and search-independent businesses, “Yeah,” apart from the need to use search when shopping, the rest are basically “non-search related” businesses, and people rarely see “yes” advertisements in public media. .

It can be expected that Baidu will not only invest 10% of its resources in the LBS Division. Baidu CEO Li Yanhong recently revealed in a Stanford University speech that Baidu’s 25% of R&D expenditures are spent on the mobile Internet, but revenue accounts for less than 10%. This shows its determination to enter the mobile Internet. Li Yanhong appointed the original Baidu Business Applications Product Marketing Department responsible for Phoenix Nest's director Shen Li to co-ordinate the LBS Business Unit. Compared with the previous, the newly established LBS has greater rights in the autonomy decision, especially in the promotion will receive greater support from the company.

Baidu map was originally launched as a service of Baidu search, its main function is to provide services for users to travel, and did not establish a complete ecological chain with merchants and developers. Therefore, Baidu's move into LBS is not only a continuation of the traditional offline business, but also shows a new way of thinking: after the advent of the mobile Internet era, it is difficult to complete the task of gathering users simply by using the search box, and building a mobile based on LBS. The Internet platform became another choice for Baidu.

New "enclosure movement"

On the PC side, Baidu’s search business profitability model is “traffic monetization,” and it first obtains users through high-quality search services, and then achieves commercial goals through advertising. In the field of mobile Internet, although traffic does not necessarily represent revenue, it is clear that Baidu needs to acquire a large number of users to form large-scale traffic.

Then Baidu needs to provide services. Baidu chose LBS. However, Baidu does not use LBS as a business, but as a platform to capture users by gathering a large number of resources such as merchants, developers and other industrial chains. Bai Qiu, vice president of Baidu, pointed out that the Baidu LBS business unit will open up the upstream and downstream links of the industrial chain, achieve data exchange, share users and information markets, and establish the LBS industry ecosystem.

On the mobile Internet, it is difficult to get a large amount of traffic through a killer application. A large number of APPs divert users, and users' choices of APPs are becoming more and more critical. Baidu set up the LBS Business Unit to open up maps and other resources to form a platform, and it is possible to “circle” traffic.

On the PC side, Baidu’s success is fundamentally the success of the ecosystem. Baidu relied on traffic distribution mechanisms to benefit a large number of webmasters and formed a huge ecosystem. On the mobile Internet, this rule also applies. Wang Mengqiu said, "Whatever the concept, product or organizational structure adjustment, Baidu's ultimate goal is to 'make people the most equitable and convenient access to information, find the desired.' Baidu hopes that with the establishment of the LBS business unit, will lead users to enjoy smart The convenience of life, the joint development of the market for developers, and the promotion of digital marketing of 'internetization' by traditional businesses and merchants, so that all parties can give full play to their respective values ​​and gain full growth and benefits. The industrial chain and the way to improve the ecological circle will promote the development and co-prosperity of the entire industry.”