Why did Wuzhen succeed?

There are two points: first, innovation; second, hard work. These two points must always have a goal—the Wuzhen we want to create is different.

From a sightseeing town to a resort town to a cultural town, Wuzhen's core is to create differentiation in terms of resource products and spiritual forms, generate business models, and form competitive barriers.

Jiao Yulu once said something that left a deep impression on me: Don't chew other people's bread. What does it mean? I don't chew the bread that others have chewed twice. This is differentiation.

Phase 1 of Wuzhen's development and protection project—East Gate Scenic Area (sightseeing town): Amplifying the differentiation of resources, constructing the visual, sensory, and experiential aspects of sightseeing products, and forming the unique advantage of the scenic area's inherent superiority.

At that time, I spent half a year visiting several famous ancient towns in China, and I found that they had several common points:

All ancient towns were not developed at once. Their formation was a result of a leader initiating the process, followed by the local people, gradually developing them. There was no consideration of a complete product form, and there wasn't even a parking lot.

Therefore, Wuzhen's East Gate was the first scenic area to establish a parking lot.

The focus was on point-based operations. Even today, we can still see many scenic areas where things are sold here, and banners are hung there, with tour guides desperately saying, "Our place was visited by this emperor, produced so many saints, and had so many champions." These are all basic routines.

I saw that all other ancient towns only had one street or one area that resembled an ancient town. So, what did I want to do with the East Gate scenic area?

What I wanted to do was the overall appearance—not just a point, but an area.

So, I demolished the new houses in the old area: all buildings that were inconsistent with the old area, dormitories from the 1970s and 1980s, and clock tower buildings, I demolished them all. I wanted to subtract, so that the old houses could stand out.

Why was Wuzhen able to rise to the top after opening to the outside world in 2000? Because Wuzhen got lucky: everyone thought Wuzhen looked like an ancient town, a pristine small town, which is something other ancient towns didn't have.

Phase 2 of Wuzhen's development and protection project—West Gate Scenic Area (resort town): Using product differentiation to create and amplify the immersive experience of resort guests, and building the scenic area's differentiation from similar products.

If the East Gate has resource differentiation, then the West Gate has product differentiation. The East Gate is for daytime sightseeing, while the West Gate is for nighttime sightseeing, resort tourism, and staying overnight, making tourists want to come back again.

Things that modern communities have, this ancient town must also have. I did several things:

Building basic infrastructure. I built a liquefied gas station myself, so that every household had piped gas.

Establishing a drinking water plant. In today's ancient towns, the tap water is graded, some can be drunk directly, and some is tap water.

Building a wireless network. Allowing all residents of the West Gate to use WIFI for free.

For resort tourism, what kind of tourists are the most important? People who stay overnight are the most important. Why did I build all these facilities? For those who stay overnight.

In a certain sense, tourists' love for ancient towns is "pseudo-love." They come from Beijing, Shanghai, and Hangzhou, and they see high-rise buildings every day, so they want to escape to ancient towns. Here, high-rise buildings are replaced by small bridges and flowing water. But they still want to live their familiar lives: the first thing you do when you arrive at a place is to check your phone to see if there is WIFI? If the WIFI in this place is free, you will immediately have a good feeling about this place.

Many scenic areas don't pay attention to accommodation; their business model is based on tickets.

But I do. If I only painstakingly create a good external environment and let high-end hotels move in, what benefit is there for me? I'm just working for the hotels.

In all the projects I've done across the country, there's one principle: I don't cooperate with any accommodation within the scenic area; I manage them all myself.

Homestays

All homestays have unified decoration, and our homestay business model is divided into two categories:

The first category is catering. I don't want a penny. All bosses, after passing our assessment, will receive 100% of the profits, but they must follow my management.

The second category is accommodation. We share profits with the owners; I provide the costs, cleaning fees, and other expenses.

Although it seems we've incurred losses by providing free renovations, there are two advantages:

It ensures that hotel labor costs are not wasted even with low occupancy rates.

Most importantly, it allows tourists to experience authentic service firsthand.

We have a comprehensive management system for our homestays, down to the details, even classifying cleaning cloths for different uses, ensuring everything is clean.

However, if you want your employees to meet your standards, you must provide them with sufficient income. Basic operators of homestays in Wuzhen generally earn 200,000-300,000 yuan annually. With an annual income of hundreds of thousands, they will have to listen to you.

We have a points card system; if you don't comply with management, you have to leave. Since all renovations are ours, you should leave. Therefore, our homestays will not engage in any forced buying or selling.

Hotels within the scenic area

I now design all the hotels I build myself. The traditional hotel industry follows the approach of planned economy business hotels, and has not transitioned to an experience-centered resort mindset.

Corridors: Typical hotel corridors are 1.8 meters wide, but all my hotels now have 3-meter-wide corridors, making them feel spacious and comfortable.

Guest rooms: All hotel rooms are large. When you enter, you'll find that even the bathrooms are large, which makes a big difference.

No standard rating: Among the many hotels in Wuzhen West Gate, with over 2000 rooms, none participate in star ratings. The highest rating comes from tourists.

I'm very proud of my hotels; our occupancy rate is the highest among hotels with similar pricing, and our efficiency is also the best.

Why? People feel that hotels within the Wuzhen scenic area are different, the feeling is different. This is the experience.

We are now discussing whole-region tourism, and one obvious characteristic is the de-scening of attractions. That is, a scenic area doesn't look like a scenic area, but rather an area with strong regional characteristics.

Therefore, Wuzhen's attractions are not obvious attractions.

Of our nearly 10 million tourists, 80% are individual travelers, and over half of those 80% are repeat visitors. They are more familiar with the place than I am, knowing which room number is which, and where the delicious food is. They don't come for the attractions.

Our economy has developed to the point where people no longer need "occupational" tourism, taking photos and simply visiting; instead, they experience the local customs and culture.

For example, we have a wedding customs museum, which displays old marriage certificates and recreates scenes from old marriage registrations. Furthermore, we can take wedding photos for tourists and issue fake marriage certificates. This greatly increases tourist participation.

What is this kind of tourism called? Immersive tourism.

I don't need large buildings; I want to create a garden where you can see the land and flowers and plants. Including the ancient Shuibei Town, our projects emphasize the integration of architecture with the landscape. Allowing people to blend with the architecture and landscape. This is nature.

What is the biggest difference in a scenic area? That your place is more beautiful than other places.

In West Gate, food within the scenic area is cheaper than outside. Because I want to establish an experience system.

Our catering system starts with distribution, centralized purchasing—the soy sauce, wine, and MSG used are all branded. We will send people to check; if you use substandard oil, you will be immediately heavily penalized and removed.

Our products are the best, but we require everyone to lower the average gross profit margin. Catering in the Wuzhen scenic area never makes money, or makes very little. Why? You can't make money everywhere in the scenic area. We make money from accommodation and tickets. Everyone eats a cheap meal, forgetting that the rooms are expensive at night.

Therefore, we owners must understand what our biggest source of profit is.

Differentiation is a system. Our resources are different, our products are different, and the experience should also be different.

The image of small bridges, flowing water, and houses is common. In the increasingly homogenized scenic areas in China, how can we be different? We decided to focus on culture. Culture is the best way to amplify the scenic area's IP.

So we started the third phase, called the cultural town.

Holding major international cultural festivals such as the Wuzhen Theatre Festival (cultural town): Using culture as a major means to amplify the scenic area's IP, creating cultural and spiritual experiences for resort guests, and forming intangible competitive advantages for the scenic area.

What is drama? It's like tourism, it's life.

In today's boom of ancient town tourism, only Wuzhen has a theatre festival. The theatre festival makes Wuzhen's atmosphere different.

Every year at the Wuzhen Theatre Festival, Shanghai's art community comes in government-organized groups; many foreigners learned about Wuzhen not because of tourism, but through the Wuzhen Theatre Festival.

This is the benefit of culture.

This art museum cost a lot of money, more than 80 million yuan, and took three years to build. We wanted to create a different art museum, hiring an interior designer from the Louvre Museum in France.

In fact, the investment in large theaters and art museums like this does not have a direct benefit for tourism. The art museum needs at least ten million yuan in subsidies annually.

What am I doing? I have a selfish motive.

I am from Wuzhen. I have provided the best environment for the children of this small town, with the art museum open free of charge to primary school students. In a third-tier city's Jiangnan town, there is an art museum where international art exhibitions can be seen. So, what is the difference between it and children in Beijing and Shanghai?

In addition, Wuzhen has thus become confident in its rising value. These two museums have become new landmarks of Wuzhen. They may not directly generate profits, but they have laid the groundwork for Wuzhen's development in the next ten years.

What is the future of Wuzhen tourism? Culture! These are all seeds.

Creating differentiation and shaping experience tests a company leader's ability to balance and keenly sense the resources under their control, and it is a long-term, gradual process of system improvement.

Different: Use a 'different' approach to create one's own unique competitive advantage, thereby winning higher-than-industry marginal profits.

We want to be a marginal profit earner above this industry. Like everyone else, we are entering an industry that almost anyone can enter.

You should first ask yourself two questions:

What is your core competitiveness? What do you rely on to earn money that others cannot?

These are two seemingly simple but profound questions. How to magnify the difference?

Many ancient towns lack unified management at night. But we are different; the later it gets, the more we increase the management and efforts to create a scenic atmosphere.

We work on light effects and invited three groups of people to help us assess: photographers, IP tourists, and overnight tourists. We modify anything they find unattractive.

We don't use contour lights to outline houses, nor colored light bulbs. All scenic areas are monochromatic. At night, we provide ample leisure space, with food, accommodation, and entertainment.

Commerce can also be scenery. We don't want vulgar commercial establishments lacking personality.

Many ancient towns have shop signs that are computer-printed, with characters as large as possible; or embroidered sign flags. We are different; we pay special attention to shop signs. The shop signs in Guoshuibei Town are all hand-painted.

I divide all my businesses into two categories: profitable and unprofitable. Unprofitable ones are those that create atmosphere, such as those selling feather dusters and goose feather fans. These shops don't make money; we subsidize them.

The Xizha scenic area does not operate on a rental model; a scenic area cannot sell two of the same product. What you want to sell, and how you want to sell it, write it down first, and we will evaluate it. If we think you will make money, we will charge appropriate rent; if not, we will charge less rent, or even no rent.

Why are our rooms more expensive than average, even though they are not five-star rated? Because they allow tourists to feel comfortable, safe walking on the streets, and not afraid of dust even in slippers.

Insight: Use keen 'insight' to focus on customer feelings and create more surprises and touches.

Many hotels calculate costs, and disposable supplies are best to save money. What do you save that money for? Increasing the customer unit price by ten yuan, and having them willing to stay again, that's everything.

Everyone has experienced this: in summer accommodation, cotton slippers feel uncomfortable to wear, and you can't wear them outside. So in summer, we provide flip-flops using the best domestic materials, costing more than ten yuan. Moreover, they are separated by gender and children.

I think this is a place with humanity, providing many things, such as free charging and free umbrella borrowing.

We use system software for free umbrella borrowing. Before, when it rained, many people didn't bring umbrellas and had to pay a 100 yuan deposit to borrow one. Now we have liberated that, you can take one for free, but return it when you leave.

The most incomprehensible thing is that there is no toilet paper in the toilet; many scenic areas have this problem. We insist that there must be. Some toilet managers say that tourists are really careless, and the toilet paper disappears as soon as it's put out. I said that it's still a minority, and it's a small expense, you must insist.

This is the basic supply you provide. If you are stingy in this aspect, you are not fit for this business.

A local chicken soup in a Wuzhen homestay must have a minimum weight requirement for the chicken. If the chicken is only half the size, you can complain.

Details: Use consistent 'details' control, using 'system management of people and process management of affairs' as a means to establish a continuous iterative mechanism for quality improvement.

What is 'system management of people and process management of affairs'? It means that all your actions must be regulated by systems and processes. If a problem occurs, I first ask, is there a system? If not, it can be forgiven; if there is a system, and you don't follow it, the crime is aggravated.

This sounds rigid, but you need standardized and procedural services; this is the only way.

Don't forget, you need to pay attention to frontline matters. I have seen many companies grow large, but for various reasons, they don't pay attention to frontline feelings.

Even when I'm busy, there are a few things I must do. Review guest feedback weekly 。 Understand how your subordinates deal with tourists. Many Chinese tourists understand tourism better than those in the industry. Why? Because they are well-traveled, have been to many places, and some will even give you suggestions on how to do things.

Approve some invoices weekly. Understand where the company's costs occurred in the past week.

These three things are easy to say, but difficult to maintain. I've been doing it for at least ten years. The boss emphasizes details, so the subordinates emphasize details.

Establish a third-party quality supervision system. I said you are my responsibility, your job is to find fault all day long, even if it means offending people.

What is the best service? It is kindness.

Those who work here include laid-off workers, older people, and those from remote rural areas. You cannot expect each of them to be perfect, but you can require that every action and every word comes from a kind heart.

Kindness is the most common language of mankind and the most basic element of service.

Marketing: Using the power of art to connect with the inner world of ordinary life; creating an engaging marketing experience.

Wuzhen's marketing has one characteristic: we don't claim to be the best, but we emphasize that we are unique. Compared to differentiation, uniqueness demands a higher standard.

The general Chinese farmhouses are still some time away from meeting our standards of living; they are all the same, and they don't value the tourists' feelings.

If Xizha sells accommodation, what does Wucun sell? It sells time. Here, you can be a free villager.

First, we must define our target customer group. Wucun is driven by "parent-child relationships".

Nowadays, the core of tourism is children. With a child, other adults in the family will also go. We extract the rural life around Wuzhen and turn it into a participatory business model. For example, cooking campfire meals, barbecues, and baking cakes.

We have transformed idle houses without land quotas left after government demolition into guest rooms.

The concept has changed from selling rooms to selling days. When you buy a day here, meals, activities, and accommodation are all included in the price.

Amplify the experience in operations, enhance uniqueness in experiential services, "each scenic spot is a stage", only exquisite, humane, and deeply participatory experiences will create a profound impression on tourists.

Tourism is life, leisure and vacation economy is nightlife "economy": foreignness, amateurism, enjoyment.

A good unique experience is "an unexpected surprise in daily life": starting from life and context, shaping a profound experience of the object (life, spirit).

Principles for creating a good experience from an operational perspective:

1) Do not demand that every experience will bring profit to the enterprise. Because experience is a system, unlike immediate consumption.

"Small touches create big consumption." Examples:

Scenic area security - handling of drunk guests. Many people relax in Wuzhen and get drunk at night. Now we have a rule, if you drink too much, you will find someone following you, not too far or too close. Many people get drunk and lie unconscious on the ground, and we carry them back for free.

The first time you feel touched, the second time you will feel that this place is really good.

Scenic area hygiene - toilet design. On such a hot day, tourists walk around outside, and their clothes get soaked. Our current toilet design includes showers. You can go in, shower, change into a set of clothes and come out, this is humane design.

2) Intentionally create product shortages to amplify consumers' expectations of possession.

Increasing the sense of experience and maintaining a sense of hunger is very important, making the experience hard-earned.

Example:

Many people complain about Wuzhen's snacks, buying a radish cake requires a long queue. Why not expand the scale of radish cakes? This is my philosophy: eating snacks is a kind of fun, don't get it easily. The first time I came, I didn't get to queue, so I will queue again next time.

The scale of all our snacks is not large, but they are exquisite. Our wonton stall and rice dumpling stall are like this. We don't increase the price of our snacks, but we limit the quantity. If you increase the quantity, it's not an experience anymore.

3) The process of designing experiences is about learning to add and subtract, with the goal of making the feelings of the heart and body superior to the reference objects.

Addition: Innkeepers welcoming guests.

The innkeeper should go to the door to greet the tourists, help them with their luggage, this will make the tourists feel humane. Serve hot drinks in winter and cold drinks in summer.

Customized breakfast at the hotel. Make tourists feel that their individual needs are valued.

Subtraction: Wucun's all-inclusive price.

4) In creating experiences, always use "beauty" as the starting point for enhancing the experience, and value the psychological feelings of each tourist.

In the process of creating experiences, we must not forget our original intention. What is the original intention? It is beauty. The starting point must not be twisted into making money.