Internet factory's Spring Festival Gala red envelope "sequelae"

Hidden behind the highlights of exhaustion, anxiety, panic, unwillingness and helplessness.

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Author | Xu Xiaofei

Edit | Zhou Lei

At this moment in 7 days, the annual "Spring Festival Gala Red Packet Feast" will be officially staged, and Jingdong is the protagonist of this year.

In fact, since 2014, this Chinese New Year's Eve-night essential column has witnessed the ups and downs of the Internet giants. The distribution of red envelopes for the opening of the year is not only an important demonstration of the status and strength of large factories, but also a key node in the industry game.

In view of this, Leifeng Network intercepted the cross-section of the time of "the year of the Spring Festival Gala Red Packet", in the form of flashbacks year by year, to see what kind of ambition, big strokes and big layout these big factories had in the high-light year of winning the "throne" at that time, facing their respective commercial "empires".

However, with the deepening of the combing, we also found the unknown side hidden behind the highlights, such as the fatigue of Kuaishou and the troubles of Douyin, Baidu struggling to save itself in the siege, Tencent at that time was not ordinary, and Ali's three-year-long defensive struggle.

Compared with the past and present, these Internet manufacturers are experiencing their own twists and turns, and this also casts a layer of uncertainty on the "debut" of the Spring Festival Gala in a few days after JD.com.

1

2020-2021: Kuaishou is tired, TikTok is troubled

In the past two years, the Spring Festival Gala red envelope drama has not been satisfactory for the two giants of domestic short video.

2020 is a year of exhaustion and little success for Kuaishou.

Some insiders revealed that the real cost of Kuaishou in the 2020 Spring Festival Gala battle is about 5 billion yuan, including the Spring Festival Gala cooperation fee, red envelope fee, personnel overtime pay and technical costs. The net loss of Kuaishou that year was as high as 116.6 billion yuan, which was the highest among more than a dozen Internet companies in China.

In fact, the Spring Festival Gala red envelope has never been cheap, and it is no more than two reasons for the big factories to do the Spring Festival Gala red packet, one is that the company's business needs to expand rapidly to seize more markets, such as the previous WeChat payment; the other is defensive, facing the pressure and challenges of competitors, forced to be helpless, even if it is difficult, such as the previous Taobao and this year's Kuaishou.

In terms of birth time, Kuaishou is earlier than Douyin, but under the attack of Douyin's vigorous miracle, Kuaishou has gradually declined to the second oldest in the industry. In 2019, the pressure-bearing Kuaishou launched the K3 campaign, vowing to hit 300 million DAUs in half a year. Subsequently, he spent a lot of money to win the 2020 Spring Festival Gala Red Envelope Project.

However, emergency diseases are easy to throw into the hospital, and Kuaishou has invested a lot of human and financial resources in the Spring Festival Gala red envelope, tired but with little effect.

For example, using 8 teams to race horses, but in the end, it chose a red envelope plan that looked creative but could not actually be landed by non-product personnel such as the market brand department and the operation department, resulting in the later realization of having to change and then change to no class, which not only cost a very high cost, but also the final effect data was poor.

So much so that at the review meeting in February 2020, co-founder Cheng Yixiao once summed up the K3 battle in this way: "I am not satisfied with the result, but I am very satisfied with the process of reaching the result", which can be interpreted to a certain extent as self-consolation of "no merit and hard work".

The Spring Festival Gala battle did not narrow the gap between Kuaishou and Douyin, so Kuaishou began to change its strategy and move closer to Douyin. However, this way of imitating opponents not only did not allow Kuaishou to achieve an upward breakthrough and get first- and second-tier city users like Douyin, but also shook its foundation and advantages in the original sinking market.

An industry insider told Leifeng Network that the early Kuaishou used a double-column distribution, emphasizing the community attributes, due to its three- and fourth-line village users, neighbors can often see short videos released by each other, so Kuaishou actually assumed a "video circle of friends" function in the township. But later Kuaishou changed to a single-column information flow model similar to Vibrato, which was also tilted to the head in terms of traffic, and it was increasingly difficult for ordinary people to obtain exposure, and the previous advantages began to be lost.

This consequence can also be reflected in its market value, Kuaishou submitted a prospectus in November 2020, landed on the Hong Kong Stock Exchange in February of the following year, the highest market value of the day was nearly 1.4 trillion Hong Kong dollars, and now there are only about 379.9 billion left, less than a year, the market value fell by as much as 70%.

And the vibrato side, too, has its own troubles.

At the beginning of 2021, due to the successive negative accidents of Pinduoduo, it was finally filled by Douyin and distributed the red envelopes of the Spring Festival Gala of that year. This year, ByteDance listed Douyin e-commerce as a key project and placed high hopes on the Spring Festival Gala red envelope to e-commerce. But it was soon discovered that the road was not open.

The reason is that the logic of commercial monetization of short videos and the logic of live e-commerce are essentially in conflict with each other. The means of monetization of short videos is advertising, which requires clicks and viewing time, and once users are attracted to live broadcasts, these two data of short videos will decline. And the live broadcast must also reach a certain viewing time in order to promote transactions. The two are placed on an APP, which is inherently difficult to integrate. However, if you fly alone and make an independent e-commerce APP, you will encounter the advantages of Taobao, JD.com, and Pinduoduo.

In addition to the twists and turns of e-commerce, in this year, Douyin and Byte have also experienced a series of changes such as the folding of the education business and the upgrading of the head war. In the second half of 2021, under the "double reduction" policy, vigorous education has been greatly reduced, and the education sector that had high hopes was almost broken.

Throughout 2021, the copyright war between long videos and short videos has become more intense, and Tencent's infringement lawsuit has caused Douyin a headache. According to Interface, from June to December 10, 2021, Tencent sued Douyin 168 times in 18 courts in 13 provinces across the country for copyright infringement, with a total subject amount of more than 2.943 billion yuan.

Growing, but also in constant pain, seems to be the epitome of TikTok and Byte over the past year. According to the "2021 Hurun China Top 500" ranking released by the Hurun Research Institute, according to the market value or valuation, ByteDance rose five places to fourth with 2.3 trillion yuan, second only to Tencent, TSMC and Alibaba. But at the same time, Byte's annual revenue in 2021 was 367.9 billion, an increase of 70% year-on-year, and last year's increase of 111% year-on-year, and the growth rate fell sharply.

This should also coincide with the news that Byte's domestic advertising revenue has stopped growing in the past six months at the general meeting of the commercial product department in November last year. This is the first time since Byte began commercialization in 2013.

In the unstoppable TikTok overseas, the commercialization process is not as successful as the douyin in the domestic market in previous years.

Taking TikTok e-commerce as an example, Based on its powerful recommendation engine algorithm system, Douyin has increased the share of Douyin e-commerce exponentially, with a GMV of more than 500 billion yuan in 2020. However, due to the impact of data protection laws such as GDPR and CCPA in overseas markets, the polishing of recommendation algorithms is limited everywhere.

Whether it is e-commerce or advertising, due to the obstruction of the improvement of recommendation accuracy, the realization of TikTok is not difficult to make, so it even transferred Zhu Wenjia, CEO of today's headlines and the founder of the Douyin recommendation engine, and transferred to the algorithm responsible for TikTok. The relevant history of the byte recommendation engine can refer to Leifeng Network's previous report "Those who changed the world with the recommendation engine".

This kind of pain and trouble is also reflected in the investment side, a few days ago, the byte side was exposed to the overall layoff of the strategic investment business, involving about 100 employees, the financial investment section will be completely dissolved, the initial outline of the "byte system" began to become uncertain.

2

2019: Baidu opens high and goes low

In fact, as early as before Douyin Kuaishou, Baidu took the lead in experiencing the gap between expectations and results hidden behind the Spring Festival Gala red packets.

In 2019, Baidu, which is trying to rise up, won the exclusive red envelope interaction of the Spring Festival Gala, and achieved 20.8 billion interactions of Baidu APP red envelopes with 900 million yuan.

However, the highlight of the beginning of the year did not last long, according to the monitoring of the IfingInfo Research and Innovation Center, by February 9, the new user retention rate of mobile phone Baidu was only 2%, and the financial and mobile terminal business did not have a major breakthrough in the distribution of red envelopes.

This year, whether it is Baidu, Google or Sogou, its core business, search, is facing severe challenges from two aspects. First, around the major APP, the vertical content ecology is rapidly formed, and the good content that can be obtained from the web page is getting less and less; the second is the rise of information flow and short videos, accelerating the snatching of user attention, and the traffic is constantly cannibalized.

Under such siege, Baidu's core online advertising revenue (search and information flow) has experienced three consecutive quarters of negative growth in 2019.

So throughout 2019, Baidu actively laid out the mobile content ecology, invested in Zhihu, exerted force on 100 numbers, and did a closed content ecology, but these efforts did not meet the expectations of the outside world in today's view.

The decline in business has also been accompanied by executive changes. In May 2019, after the release of Baidu's first quarterly report on losses since its listing, Xiang Hailong left his post. In this year, many executives such as Vice President Wu Haifeng, Vice President Gu Guodong, Vice President Zheng Zibin, and Vice President Zhao Cheng, Vice President of Government Relations, have left one after another.

In fact, in 2019, the pattern of BAT has been officially rewritten. Jingdong, Meituan, Pinduoduo and other Internet companies have successively surpassed Baidu in market value, and Baidu once fell out of the top five camps of Internet manufacturers.

Although under the leadership of Wang Haifeng, Shen Ji, Li Zhenyu and other technical executives, Baidu's AI, information flow, and automatic driving innovations continue to be at the forefront of the industry. However, the core business search will still face many challenges, on the one hand, the UGC-style search model is being impacted by the PUGC model, and secondly, Baidu will also face Tencent and Byte's search in the next five years. Refer to the Leifeng network report "Tencent restarts the search: can it merge with PCG internally and fight Baidu bytes externally?" 》。

3

2016-2018: Ali's defensive battle

Ali went to the Spring Festival Gala, and at first it was more out of "self-defense".

At the Spring Festival Gala in 2014, WeChat Pay seized the opportunity to "sneak attack Pearl Harbor" on Alipay with red envelopes, and then launched a comprehensive financial offensive in 2015.

In the face of the threat of WeChat Pay and Tencent Finance, Alipay and Ali recovered from the shock and rushed to the battle, and since then they have started a three-year defensive war.

In 2016, Ali won the Spring Festival Gala bid "very hard" at a cost of more than 5 times that of his opponent. During the Spring Festival in 2018, more than 1 billion yuan of cash red envelopes were distributed, 1,000 shopping carts were emptied, and an annual hot word was created: throwing money.

But in fact, rushing to battle often leads to omissions. The large amount of money burning not only did not alleviate the anxiety of Alipay and Ali, but let it amplify its shortcomings in the head-to-head confrontation with WeChat and Tencent - social networking and the lack of low-cost traffic brought about by it.

So in the 2016 Spring Festival Gala, in order to open up the social relationship chain, Alipay launched a password red envelope, set five blessings and other ways to play, but due to insufficient grasp of human nature, the number of dedication blessings released was very small, which caused participants to complain.

Moreover, this red envelope distribution is completely in accordance with the idea of "burning money to buy users", lack of refined operation, and no "data distinction between new and old users" began to burn, resulting in low efficiency of burning money. With the passage of time, the heat of the Spring Festival Gala gradually dissipated, and the social relationships linked by the Spring Festival Gala also fell silent at a speed visible to the naked eye.

In order to save the crisis, in November, Alipay launched the "play circle", but due to poor consideration and quick success, there were soon indecent photos in the "white-collar diary" and "campus diary", which were immediately stopped.

Social dreams are broken, And Alipay and Ali can only return to the old road of burning money to buy traffic. According to Ant Financial's prospectus, in the following three years from 2017 to 2019, its sales expenses including red envelopes, subsidies, markets, etc. reached more than 80 billion.

In addition, in order to cope with WeChat Pay at that time, Alipay also sank to the fourth and fifth-tier cities to obtain new users, do the ground push advertising, but soon found depressed that although it also achieved market share growth, but did not advertise WeChat Pay instead took the opportunity to rub more traffic and market share, after all, with the bank card directly tied ToChat Pay, the function is the same, and there is no need to download an APP.

Therefore, for Alipay and Ali, no money is spent, they have no growth, spend money, the opponent grows faster, and both inside and outside have to accept the opponent's catch-up with themselves in market share. This also seems to indicate its current fate, not only in terms of financial obstacles, Ali's overall market value is also surpassed by Tencent in 2021.

4

2014-2015: Tencent, which is not willing to be ordinary

Tencent seven or eight years ago was not as low-key and ordinary as it is now.

From august 2013, when it was officially launched with the WeChat version 5.0 to the 2014 Spring Festival Gala counterattack, in just a few months, WeChat Pay was full of vigor and attacked the Alipay position with red envelopes, and the war on the mobile payment port was burned to Ma Yun's doorstep.

Activating more than 8 million WeChat Pay users, allowing more than 30 million users to bind bank cards, weChat Pay, which was launched recently, made a splash in an unexpected way, and also opened up the most critical link of online payment - account binding, laying the foundation for the rollout of the financial map in 2015.

After the Spring Festival Gala in 2014, Tencent made a big fuss and continued to challenge Alipay's "bright sword" around payment, in the field of e-commerce and taxi. In fact, that year, there was the most and most intensive business war in the entire Chinese Internet industry since its birth, covering mobile phone taxis, campus takeaways, online movie tickets, campus staging and other fields, and the key points of these business wars were payments, all pointing to the "A" and "T" competition.

Such competition has broken the situation that Alipay is dominant, but it has also made the duopoly pattern in the payment field emerge. The money-burning subsidy in the taxi war has also been "inherited" since then, becoming a major feature of the domestic Internet business war. Since then, the repeated cash-burning wars have made small and medium-sized players have no chance to play at all, and the unicorns burned in a short period of time are often strong in essence while forming a new monopoly.

In 2015, Tencent accelerated the pace of financial layout. At the same time, because the traffic of WeChat Pay in the previous year began to fall sharply after the Spring Festival, the stickiness of new users brought by it was not achieved, becoming a "virtual fire" and pouring cold water on Tencent. So in the next 2015, Tencent decided to further consolidate the results of the battle, and adopted a two-handed layout for this purpose.

On the one hand, continue to increase the Spring Festival Gala. This year, WeChat became the exclusive partner of the Spring Festival Gala Red Packet, with new ways of playing such as "shake a shake", harvested a total of 11 billion interactions, And WeChat Pay achieved more than 300 million users in May of that year, truly taking root in the field of payment.

On the other hand, Tencent has blossomed in the fields of banking, wealth management, credit information, insurance, securities and other fields, and has quickly expanded its financial territory.

On January 18, Tencent WeBank began soft operation before the online commercial bank (June 25), and in July, Tencent cooperated with GF Credit Card to provide data on the credit reporting dimension based on the three major products of face recognition system, credit reporting system and anti-fraud system.

In May, WeBank began internal testing of its first product, "Micro-particle Loan", which focuses on Internet small loans of less than 200,000 yuan, and in August, Tencent launched an Internet life insurance company, Hetai Life, after participating in the establishment of ZhongAn Insurance in 2013.

This year, Tencent also participated in the B round of financing of Futu Securities. Coupled with the A round in 2014 and the C round in 2017, in the three investments in Futu Securities, Tencent's tentacles in the field of Internet securities have become stronger and stronger.

It can be said that after the high opening of the red envelope at the Spring Festival Gala this year, Tencent has made a big fuss and become more and more powerful in the layout of financial business, initially collecting the puzzle of the financial empire, although there are still many gaps from Alipay and Ali, but it has also brought all-round pressure to it.

It was also from this year that Tencent's financial empire began to rise. But as the financial business has become bigger and bigger, unlike the high profile of Jack Ma and Ant Financial, Tencent Finance has become more low-key, hidden in the group, and quietly grown into a behemoth.

According to the latest financial report, Tencent's revenue in the 2021 Q3 Tencent financial technology and enterprise services sector has reached 43.3 billion yuan, an increase of 30% year-on-year; at the same time, the proportion of the sector in the total revenue has increased to 30%, which has become Tencent's second largest performance growth point, second only to value-added services such as games and social networking (accounting for 53%).

And the low profile and stealth of all this has changed with the termination of Ant Financial's listing in November 2020. The capital feast was stopped, and Internet finance entered a period of consolidation. Tencent's financial landscape has also been pushed into the spotlight and repeatedly looked at.

At this time, the outside world realized that tencent finance's strength is not inferior to ant groups, and even in some aspects, the volume of "penguins" has surpassed that of ants. As a result, it becomes inevitable to split it up and accept regulation independently.

Tencent, which soared in finance in 2015, also bluntly said that "there is no need to split for the sake of splitting", but now its attitude has taken a 180-degree turn. Recently, Tencent has successively reduced its holdings in investment assets such as JD.com, Zhihu and Sea, which has also been interpreted by the capital market as clearing obstacles for the splitting of financial business.

At the employee conference at the end of 2021, Ma Huateng emphasized that Tencent is an ordinary company. From not willing to be ordinary to emphasizing the ordinary, Tencent took eight years to complete this transformation.

5

2022: JD.com is still unknown

Judging from the experience of Previous Internet giants, in addition to WeChat taking the lead, the cost and benefits of other large manufacturers in the Spring Festival Gala Red Envelope War are difficult to say how cost-effective and successful. This also casts a layer of uncertainty over JD.com's Spring Festival Gala "debut".

The first is the uncertainty of the flow effect.

At present, JD.com is undoubtedly very hungry for traffic. In recent years, the strong siege of Pinduoduo's "rural encirclement of the city", the cross-border invasion of live e-commerce, and the "warlord scuffle" of community e-commerce have constantly threatened and even encroached on Jingdong's traffic pool.

In this regard, JD.com is also constantly seeking a way out of difficulties. For example, in 2019, the "pinchao" was renamed "Jingxi", and in 2020, the sinking strategy was taken as the key strategy of the year, and at the end of the year, JD Retail intensively carried out three structural adjustments and personnel appointments in just one month to cope with the community group buying war. The interactive project of winning the Spring Festival Gala red envelope this time can also be seen as a continuation of the sinking strategy.

However, in recent years, with the general trend of domestic population and the sluggish consumption under the epidemic, it has become increasingly difficult to obtain and maintain traffic. These may allow JD.com to discount the acquisition and retention of Spring Festival Gala traffic.

Perhaps also out of concern about traffic, JD.com extended the time of this Spring Festival Gala interactive event, which lasted from the 22nd of the Waxing Moon (January 24) to the Lantern Festival (February 15), running through the entire Spring Festival.

It is worth mentioning that in addition to the above-mentioned adjustment of the retail side organization, in the past year, JD.com has successively adjusted the financial, cloud and other businesses: the two parties of JD Digital and the former JD Cloud and AI Business Department were integrated into the JD Technology Sub-Group; subsequently, the listing process of JD Digital's Science and Technology Innovation Board was also suspended.

According to today's latest news, JD Technology plans to IPO in Hong Kong in 2022, raising 1 billion to 2 billion US dollars.

Industry insiders pointed out that these successive big moves have further strengthened JD.com's own scientific and technological attributes and weakened the original financial color.

It is not difficult to see that for Jingdong, this year's large-scale Spring Festival Gala red envelope is a collective appearance and acceptance of results after the organizational structure adjustment of e-commerce, finance, cloud and other sectors. However, whether the Spring Festival Gala red envelope war can bring it the expected effect, so that JD.com can successfully prove itself in terms of traffic defense war, sinking market competition, scientific and technological strength and attributes, etc., it remains to be seen.

END