Shenrancaijing original
Author | Li Qiuhan
Editor | Wei Jia
“I actually heard the team say more than once, why this competition is endless and when will it end?” Founder and CEO Zhang Yiming said at the 9th Anniversary Meeting of Bytedance, and expressed his views on the competition through a speech. The attitude of “competition must be regarded as the norm.”
Zhang Yiming did indeed do this.
Backed by Douyin and Toutiao, the two “money printing machines”, Bytedance expanded without borders, launched “full” search ads against Baidu, opened Douyin e-commerce to challenge Ali, and attacked Tencent in the entertainment field. , Lay out education, health, and challenge the industry leader… As far as we can imagine big and small giants, ByteDance is grabbing jobs with them.
In 2021, ByteDance’s expansion rate is still accelerating.
One obvious change is that Douyin has begun to bear the ambition of Byte Beat. In addition to developing e-commerce, it also vigorously enters the local life field and invades the hinterland of Meituan. In addition, its existing games, education, finance and other businesses are becoming more and more important. In the hard-core technology fields such as automobiles and chips that have never been involved before, they have also begun to make their own arrangements.
In addition, the pace of its foreign investment has also accelerated significantly. According to reports, before the end of the first quarter of 2021, Bytedance has made 16 investments, which is half of the total investment in 2020. Among them, the proportion of entertainment and entertainment has been significantly reduced, artificial intelligence has maintained a high proportion, and the proportion of e-commerce, new consumption, and remote office has increased significantly.
After gathering users through the advantages of algorithm distribution, Bytedance is exhausting the three major Internet traffic monetization models of “advertising, gaming, and e-commerce”. In addition, the threshold for education, medical care, automobile, finance, etc. is high, but the future The sectors with large profit margins also have the ambition to break them one by one.
It is reported that ByteDance will submit a prospectus on the Hong Kong Stock Exchange in the second quarter. These intensive actions may be preparations for the sprint before going public. Through sorting out the inventory, let’s take a look at where in 2021, where did the byte beat jump?
Local life, the banknote printing machine Douyin is getting “crazy”
In March 2021, Douyin (including volcano and speed version) was exposed by the media with a daily average of over 600 million, with a peak of about 700 million.
This is not much different from the previously disclosed data: In September 2020, Zhang Nan, CEO of ByteDance China, disclosed at the event that, including Douyin Volcano and Extreme Edition, Douyin’s daily active users have exceeded 600 million. . In the “2020 Douyin Data Report” released on January 5, 2021, this number is still used when it is disclosed that Douyin is active. Between the two data disclosures, Douyin also conducted a series of new activities such as “titled the Spring Festival Gala”.
Many people in the industry believe that this means Douyin has faced a growth bottleneck.
In the first three months of 2021, Douyin will mainly do three things. One is to expand social scenes and increase tool-based functions, the other is to vigorously engage in e-commerce, and the third is to enter local life. The purpose is to extend the time of user stay, and Expand commercialization scenarios and accelerate earning money.
In terms of expanding social scenes and increasing tool-based functions, the Douyin APP was revealed to be testing a variety of new features, such as friend K song, multi-person voice chat, “watch video together” function, etc., which enriches the site’s gameplay and increases user stays. The role of duration. At the beginning of the year, Douyin announced for the first time that its number of active search users has exceeded 550 million, and the results are beginning to show.
Compared with keeping users in Douyin, Douyin has more actions for the expansion of the commercial scene.
On April 8, 2021, Douyin held the first E-commerce Ecological Conference and launched a new concept of “interested e-commerce”, which is based on user preferences, using big data and recommendation mechanisms to stimulate consumers’ potential purchase desires. At the event site, in response to whether he would build an independent e-commerce app, Kang Zeyu, president of Douyin e-commerce, said that various forms would not rule out trying. The reply is ambiguous, but we can also see the ambition of Bytedance in the field of e-commerce.
Tik Tok e-commerce is not limited to live e-commerce, but has turned the traditional graphic “people looking for goods” to short video “goods looking for people”. This is based on the existing algorithm and content advantages of Douyin. It is also clearer than before. However, how much consumer interest can be stimulated by interest e-commerce, and whether the conversion rate can balance the input-output ratio of the business remains to be investigated.
Regardless of whether “interest e-commerce” is a real demand or a false concept, in the view of Wang Chao, the founder of Wenyuan Think Tank, the problem facing Douyin e-commerce is that “all kinds of infrastructure are not in their own hands, such as express delivery” Da’ (Zhongtong, Yuantong, Shentong, Best Huitong, Yunda) has cooperation with Ali, and the relationship between Jitu Express and Pinduoduo is subtle.” He reminded that in addition to express delivery, return and exchange systems, customer service systems, and quality control systems, Douyin e-commerce companies still have a lot to improve.
In the field of local life, Douyin has similar advantages and difficulties to overcome.
Now open Douyin, the first column of the interface is related to “dining, drinking, and having fun”. Click “Discount Group Purchase” to get information about nearby food, restaurants, hotels and homestays, including store selling points, business contact information, distance, etc., and click ” Popular list”, you can get the ranking list of nearby scenic spots, playgrounds, and park squares, just like an implanted version of Meituan + Dianping.
“The amount of information brought by the video stream is the most. It is more intuitive and more stimulating than the graphic stream of Meituan and Dianping, which is equivalent to a dimensionality reduction attack.” Wang Chao said that Douyin has the use of algorithms to complete the The closed-loop advantage of planting grass to consumption. When users use Douyin, they can see nearby restaurant recommendations, and they can use Douyin to scan codes to order meals in the store and get group purchase coupons. For merchants, they can use Douyin to place them and get exposure opportunities based on content positioning.
However, there are many problems facing Douyin. The local life business first needs a strong enough offline “ground push” army. At present, Douyin is still under construction, and this is the strength of Meituan. Secondly, it will take some time to accumulate the number of merchants and the mental cultivation of users’ consumption habits. Lastly, more importantly, like Douyin e-commerce, the conversion rate from planting grass to consumption is still a question mark.
At a conference in early 2021, Zhang Nan, CEO of ByteDance, explained the development direction of Douyin over the past four years: “Douyin has changed from an initial entertainment method to a social method, and then to a lifestyle. “Douyin is being realized step by step. In the future, it will be involved in more business fields than we thought.
Pan-entertainment relies on buying, buying and buying to bite Tencent
The pan-entertainment sector has always been the basic disk of Bytedance. If this field is divided into upstream content IP, midstream film and television production, and downstream game realization, you can see that the layout of Bytedance in the upstream and downstream is significantly accelerated. The competition with Tencent has entered a fierce stage.
Let’s first look at the downstream that has changed the most. The latest news is that Bytedance has bought a game company again. On April 13, less than half a month after the acquisition of Mutong Technology, ByteDance’s Chaoxi Guangnian, which is responsible for the medium-to-heavy game business, wholly acquired “Youai Mutual Entertainment”. The company’s product types are concentrated in RPG (role playing) two-dimensional and strategy (referring to players using strategies to compete with computers or other players) two categories, which have outstanding performance in the Japanese and Korean markets.
The two newly purchased companies both focus on medium and heavy games, and both are good at going overseas, and both have disputes with Tencent. They once again released the signal that ByteDance wants to be strong on Tencent, but avoids its territory and expands overseas. .
Previously, the media concluded that Bytedance currently has 29 game companies, more than 10 game studios, 4 major publishing platforms, and more than 2,000 employees. It starts with casual games and gradually increases the number of medium and heavy games, and the development speed exceeds Outside imagination. However, a senior investor in the game field told Shenran that in terms of revenue, Bytedance’s games are actually incomparable with Tencent or even NetEase.
Let’s look at the upstream again. For Internet companies, buying a web-text company is a cost-effective business. Grasping the lifeblood of the source of IP has great room for development in pan-entertainment. In the second half of 2020, ByteDance has already relied on “spending money” and swept through all the online literature companies that can invest: it has invested 1.1 billion yuan in investment and reading, and invested in five mid-waist online literature companies.
Its competition with Tencent in the field of online literature has become a competition between “Palm Reading + Tomato Novel + 5 Mid-waist Web Literature Companies” and “Reading”, and it is worth noting that Tomato Novels was only launched in November 2019. Net, the number of monthly active users has ranked first in the industry, and Bytedance has gained a firm foothold in the field of free reading.
However, it is easy to obtain traffic for free reading, but it is faced with the problems of “no money” and “IP incubation”. In terms of IP development, ByteDance has not yet proven its strength.
This is also the embarrassment of ByteDance in the pan-entertainment field. From the perspective of territorial expansion, the speed of Bytedance’s firm foothold in the upstream and downstream is staggering, but from the perspective of profitability, most of the investment is still in the layout stage, lacking the ability to realize immediate cash, and whether some investments can be made in the future. Realization remains to be investigated.
This is also related to the small number of byte jumps in the midstream segment. What affects the speed of midstream deployment is closely related to the difficulty of realizing the field and the high threshold.
Vertical business education, finance, and corporate services are becoming more and more “heavy”
In addition to the pan-culture and entertainment fields, ByteDance has entered into vertical long-term businesses with large prospects and large investments, which can be roughly divided into financial, corporate services, education, and medical services, and these fields are showing increasing importance. “the trend of.
The launch of Douyin Pay on January 19 caused heated discussions. In fact, the financial business of Bytedance has quietly formed a complete territory.
At present, ByteDance has obtained an insurance brokerage license (June 2018), a securities investment advisory financial license (August 2019), a small online loan license (July 2020), and a payment license (September 2020). Four financial licenses gathered. It also applied for the registration of a series of English trademarks such as BYTECREDIT (byte credit).
In terms of payment, ByteDance has launched Douyin Pay and Hezhong Pay, and has taken a big step in expanding online and offline payment scenarios. In the field of online microfinance, referring to Ali’s play in the financial field, ByteDance tested “Relaxed Flower” on Douyin, launched “Dou Installment”, and established “Word Jump Commercial Factoring” (guarantee payment agent). ), march towards TO B.
In securities, there are also a lot of byte beating actions. In 2021, according to media reports, ByteDance plans to launch a brand prefixed with “Stellar” to develop brokerage business in China. Previously, its first financial product “Na Magnesium Stocks” has been renamed “Dolphin Stocks”, which specifically provides technical services for information release and jump links for securities companies, with the intention of developing towards branding. As early as the end of 2019, ByteDance applied for the trademark “Squirrel Securities” specifically for the Hong Kong market.
There are various signs that Bytedance is still increasing the financial layout and has ambitions to benchmark Ant Group and JD Digital. According to Wang Chao’s guess, “it is necessary to obtain a license, but referring to the situation of the Ant Group, in the case of uncertain Internet financial policies, in the second half of this year, Bytedance’s financial business will remain under secret observation and will not enter it in a big way.”
In 2021, the sector that ByteDance will bet on is still education. In February, ByteDance once again announced the recruitment of 10,000 people, covering teaching and research teaching, products, design, community class teachers, tutors and other positions, continuing its vigorous story.
In February of this year, ByteDance released “Why ByteDance Education?” “This is our answer” article focuses on 4 products: Guagualong Enlightenment for preschool children, Qingbei Online School for K12 students, Open Speaking English for adult students, and hardware for preschool + K12 Products vigorously smart lights. Previously, GoGoKid, which was the main one-on-one, did not have the following text. The paid-for-knowledge app, which was benchmarked with “Get”, was shut down by the official.
“These four business models have all been proven successful in the market,” Wang Qiang, vice president of Bita Capital Investment, who is concerned about education, told Shenran. “Bytedance’s play in the education sector is already better than when it first entered the market. Much more mature, what remains to be done is to continuously improve efficiency and give full play to its operational and traffic advantages.”
This is the biggest difference between it and other educational institutions, and it is also the difficulty it faces. “Whether it is for enlightenment or adult education, this is a business with low human efficiency and heavy service, and the hardware part is assessed by DAU. , Dali smart light is a good product, but it is easy to be controversial in the educational concept, which is the reason why smart light will be questioned by the industry before.” He said.
Although corporate services are not as high as the education sector, they are still a major focus of Bytedance’s layout. In March 2021 alone, ByteDance has invested in two video conferencing service providers, Blue Cat Micro Club and Renxiao Online, to pave the way for the upgrade of Feishu.
Currently, ByteDance has two brands, Feishu and Volcano Engine. The former was initially just a corporate communication and collaboration tool used internally by ByteDance, and it took off during the 2020 epidemic. The latter assists enterprise customers to realize organizational intelligence in the process of digital transformation, which is still in its infancy.
However, the byte beating towards TO B still needs some data to prove itself. Feishu’s competitors are already on the top of each other. Relying on WeChat, corporate WeChat has user stickiness that is unmatched by other similar products. Dingding has accumulated years of experience to achieve multi-scenario collaboration in the office. It is not easy to catch up or even overtake.
The current market presence of Volcano Engine is not strong enough. It can be seen from its “Tinder Plan” that it invested 2 billion yuan to subsidize small and medium-sized enterprises, that the business is still in the stage of “earning praise”. Enterprise customers value the comprehensive strength of project implementation, delivery and stability. The newly developed Volcano Engine still needs some accumulation and achievements.
Education, finance, and corporate services are all time to test the patience of ByteDance.
Betting on the future “car-making” and “core-making” to enter hard technology
In 2021, ByteDance releases a signal to enter hard technology. However, compared with the expansion of vertical fields such as education and finance, the intention to enter hard technology and ByteDance is more obvious in advance to pay for the future layout.
The first is the automotive field. At the beginning of 2021, Bytedance was exposed to two investment information related to cars. In March 2021, ByteDance reported that it had invested in the autonomous driving company “Qingzhou Zhihang”. Later, the media confirmed by people familiar with the matter that ByteDance was a joint lead investment with more than 25 million U.S. dollars in funding. On April 19, ByteDance’s affiliated company invested in the establishment of Chongqing Wanxiang UCAR Technology Co., Ltd., whose business scope includes second-hand car brokerage.
Prior to this, ByteDance had three other important actions in the automotive field: In 2017, ByteDance established the automotive content platform Under Auto, and in 2019, it invested 30 million US dollars in the ideal car. In May 2020, the car networking team was formally formed.
“This is a natural business expansion,” Zhang Xiang, an automotive analyst, told Shenran. “In the future, cars will develop into autonomous driving. Owners don’t have to drive and can free up time for information and entertainment. ByteDance is Internet content. Providers, the terminal outlets now are computers, mobile phones, and tablets, and they may be screens for cars in the future.” In his view, the barriers to building cars are high and the investment is large. ByteDance’s current intention is not to build cars, but to take a fancy. The interface for future content output.
Also in March 2021, Bytedance was also exposed in the self-developed cloud AI chip and Arm server chip. The latter news was confirmed by the relevant person in charge of Bytedance. This is not a “sudden whim”. As early as April 2018, Bytedance Vice President Yang Zhenyuan once told the media that Bytedance has the world’s largest number of users uploading videos that require analysis, understanding and processing, and the platform recommendation engine also needs to be powerful. Has a large number of chip purchases and applications, and is actively seeking breakthroughs in chip-related fields.
Previously in the field of technological intelligence, ByteDance invested in the AI company “Bailian Intelligence”, and also invested in hard-core technology companies such as Yunjing Intelligence, Songzhi Intelligence, Lingxi Technology, and Nut Cloud. According to the company’s data, since 2019, BYTE has made 15 public investments in artificial intelligence projects, including 4 in 2019, 6 in 2020, and a new high in 2021. As of April 22, there have been 5 cases.
Zhang Yiming once said that the core technology is the hard competitiveness behind the company. For this company that has emerged with algorithms, the importance of technology is self-evident. For example, AI technology can help it provide key data from a large amount of text, pictures, videos, games and other information on the content supply side, and outline user portraits on the user side, so as to complete the matching of supply and demand, which has a great space for development.
For ByteDance, whether it is building a car or a core, it is currently at an early stage, but it is a good “weapon” to tell a new story for the market. In the final analysis, both are areas where the time period is long, the investment is particularly large, and the revenue effect is not visible in the short term, and the patience of byte beating is also required.
In 2020, a research report related to ByteDance circulated, which showed that the annual revenue of ByteDance in 2020 will be close to 240 billion yuan, advertising revenue will reach 175 billion yuan, and live streaming will be 45-50 billion yuan. , The e-commerce business will reach 6 billion yuan, the game sector will create a turnover of 4-50 billion yuan, and the education track will have 2-3 billion yuan in revenue. Although ByteDance later officially responded to “the report information is inaccurate”, the general revenue of its various business segments can also be peeked from it.
People are amazed at the company’s speed of making money and organizational capabilities, and capital is also using rising valuations to express their optimism about this emerging giant. According to a recent report, ByteDance initiated the listing process in Hong Kong, with a valuation of approximately US$400 billion. If the news is true, the size of this huge ship is enough to challenge Tencent and Ali. At the end of March, Zhou Shengzi, a former Xiaomi executive, was invited to serve as the CFO of ByteDance, which was also regarded as ByteDance preparing for the IPO.
In the 9th anniversary speech, Zhang Yiming said that he likes to watch videos of sailing in the sea on Douyin, and he wants “the external waves are ups and downs, and the heart is calm as usual.” The bytebeat he created, people who like it, think it is the Internet The fearless young people in the world, relying on efficient organizational skills and technical advantages to expand their boundaries, people who do not like it, think that this is just an ambitious but not emotional money-making machine.
But it is undeniable that the aggressive ship he is driving has become a rival that Internet giants cannot ignore. Its enemies can’t keep their minds in peace anymore.
*The title picture comes from Visual China.
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