The most valuable aspect of the Internet lies not in creating new products, but in uncovering and revitalizing the potential within existing industries. By leveraging the Internet, traditional sectors can be reinvigorated, optimized, and transformed. From this perspective, the Internet influences traditional industries in three key ways: first, by breaking down information asymmetry and making all data transparent; second, by integrating big data to maximize resource efficiency; and third, by enabling a "group bee" mechanism — a collective intelligence that mirrors human group thinking. Imagine building a human brain memory system: initially, the connections between neural nodes are weak. But as we repeatedly access certain memories, strong neural pathways form. Before the Internet, these connections were sparse and slow to develop. However, with the Internet, those pathways light up instantly, allowing all memory nodes to connect rapidly. This creates an unprecedented system for decision-making and experience, reshaping the future of industries and humanity.
Based on this model, humans will redefine entire industries and shape the future. The machine tool industry, in particular, will evolve in three main directions:
**1. Cross-border Integration**
We are living in an era of cross-industry integration. Every sector is interlinked, and boundaries are becoming blurred. If your business has been profitable through a product or service, and another player offers it as a free value-added feature, how do you compete? How do you survive?
The future competition is no longer about products or channels, but about resource integration and consumer engagement. Whoever owns the resources and the end-users can generate profit regardless of what they consume. That’s the key to long-term success.
For us, combining machine tools with services — not just direct machine tool support, but also upstream and downstream solutions — allows us to capture our end-user base and build a loyal community known as “Shenyang Machine Tool Powder.†This gives us a powerful position in the market.
**2. Strategic Positioning**
There are five main positioning options for businesses today:
- Option 1: Become a platform like Alibaba or Tencent, building an online sales ecosystem.
- Option 2: Act as a third-party provider — logistics, training, technical support, or marketing agencies — generating revenue through services.
- Option 3: Focus on manufacturing, developing and delivering the best products and services directly to consumers.
- Option 4: Build a direct-to-consumer model, expanding through franchises or experience-based chains.
- Option 5: Control consumer resources and act as an intermediary between users and enterprises.
Each company must choose based on its own strengths. For traditional manufacturers, Option 3 is straightforward but limited in future growth. We are currently transitioning toward Option 4. Option 5 is possible, but transforming the entire industry model is challenging. Ideally, we aim to integrate all five into a full industry chain, giving us unmatched influence in the machine tool sector.
**3. New Business Model**
Traditional manufacturing is closed-loop and product-driven. Producers decide what to make, and consumers have little say. But the Internet is changing this dynamic. In the future, customers will participate in production, co-creating the products they want. This blurs the line between producers and consumers, challenging traditional economic models and paving the way for a C2B (Customer-to-Business) model.
Xiaomi is a great example of C2B in action. Kevin Kelly once described Wikipedia in *The Technological Sublime* as a system where bottom-up power, when guided by top-down rules, leads to explosive growth — surpassing even traditional encyclopedias like Encyclopedia Britannica. Similarly, the manufacturing industry is at a turning point. Mass production and large-scale advertising may soon become obsolete.
In the future, we’ll see a shift toward personalized, customized production. Everyone will be a designer, a producer, and a decision-maker in their own tribe. Companies will shrink in size but grow in precision, focusing on niche markets defined by values rather than product features. Large companies like Coca-Cola or Li Ning may struggle unless they adapt to this new tribal model.
Even though companies may not be large in scale, their customer base can still be vast, forming global tribes. The advantage of being “large and beautiful†will be replaced by the strength of being “small and beautiful.†These companies will focus on C2B models, starting with a tribe, followed by pre-sales and customization.
Apple exemplifies this approach with its “fruit powder†culture. Although its products are available in stock, its marketing strategy — creating demand through anticipation — is a form of pre-sale. Apple focuses on a small number of customizable models, which aligns with the future of e-commerce.
For the machine tool industry, the future will involve identifying specific user groups, then tailoring products to meet their needs. This requires modular design and rapid production capabilities. Using the Internet, we can connect users across regions, build databases, and analyze their preferences and experiences — ultimately creating a more responsive and intelligent system.
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