Image source @ Visual China
Wen 丨 Zero State LT (ID: LingTai_LT), Author 丨 Gao Xinchi, Editor 丨 Hu Zhanjia
It can be seen that in the past year, although Baidu's revenue has increased, its net profit has declined significantly. In the earnings meeting, Baidu Chairman Robin Li and Chief Financial Officer both highlighted the highlights of the earnings report - non-advertising revenue increased significantly, up 71% year-on-year. Robin Li attributes this to the rapid growth of non-traditional businesses such as intelligent clouds.
▲Image source: 36Kr
According to 36Kr learned from a number of employees in Baidu's various departments, in January 2022, Baidu AIG (ACG, TPG, INF), MEG and other business lines are streamlining personnel. The reduction involves multiple departments of Baidu, and each department claims the KPI of the reduction.
Baidu
In response to 36Kr, he said that there was no "layoff": "Just like other big factories, we will optimize the performance of employees in the next year. The number of optimizers is not 10%. As for the specific proportion of "performance optimization", Baidu did not respond.
From joining Baidu in 2012, to 2019 fully responsible for searching for the company's user products, Shen Ji is Baidu's irrefutable business general, but to give search new blood, leading to a new direction, the difficulty is not small, on the one hand, to keep the inherent foundation, on the other hand, to break the old, is the conservative faction or conservative, most of the time, Shen Jitter to parallel to go forward, but the current Baidu, wolves around, advertising is constantly intercepted by vibrato, fast hand, defensive posture has been difficult to resist external competition. Combing through Shen Ji's performance after three years in office, it is difficult to say that the change was successful.
01, the transformation dilemma and conservative trembling
▲Shen Ji's public speech
In 2020, ByteDance launched headline search, built a search middle platform, and fully cut into the search business. At the same time, as video consumption becomes the main means of content consumption for users, that is to say, the national applications in the mobile Internet era such as Douyin and WeChat have an innate advantage in video search and are also squeezing the space of Baidu. According to the research of GF Securities, the search behavior has obviously migrated to the short video platform, and the user penetration rate of the short video platform has reached 87.8%, and the corresponding search usage rate has reached 68.7%, ranking second in the search traffic ecology.
02, the new business is embarrassing
Baidu's new mobile ecosystem is divided into five parts, namely two platforms (information distribution, big cultural entertainment), two vertical categories (knowledge vertical category, industry vertical category) and one set of monetization (commercial products).
Going around, Shen Shu didn't advance much.
On the one hand, there is the decline in dividends such as hundreds of houses and mini programs. On the other hand, MEG's investment in entertainment has also fallen into a bottleneck. Among them, the poor performance after the acquisition of YY has also become the fuse of this wave of layoffs a few years ago.
In fact, Baidu has also made many "unwise" decisions on large acquisitions before. From the 91 mobile assistant, Qianqian Jing listening, and then to takeaway, games and other fields, some investors have commented, "Baidu's investment is to stand in the past to see the present, or stand in the present to see the present, rather than from a long-term perspective." On the one hand, many acquisition projects do not have enough advantages and are eliminated by the industry in the later stage, on the other hand, many projects do not give more resources after the acquisition to help long-term development. ”
The failure of live broadcast investment can be said to be caused by this "tradition", which also directly shows that the new business under Shen Ji's jurisdiction is difficult to take on the heavy responsibility of search + . It can be said that it is still eating the old Ben. More critically, Robin Li's main actions to the outside world focus on the development of artificial intelligence and intelligent cloud computing. Compared with autonomous driving, small intelligence, and cloud services, MEG is being mentioned less and less, bearing the burden of profitability, but there is no flower applause. This has also caused it to continue to fall into embarrassment.
03, disappearing advertisers
In recent years, the number of new CUSTOMERS of Ka (Important Customers) in Internet advertising has gradually decreased, more increments have come from small and medium-sized enterprises, and the difficulty of expanding customers has gradually increased. At the same time, many old customers' budgets in advertising have gradually decreased, and they have begun to make careful calculations, further compressing the profit margins of Internet companies.
In 2021, many important advertising "gold owners" have been greatly affected, such as online education, games, finance, investment promotion, etc., most of these industries need to rely on heavy money to buy on various platforms and obtain new customers, for them, Baidu is an important platform that they cannot avoid. On the other hand, macroeconomic instability also affects the confidence of advertisers.
A senior Chinese stock analyst mentioned to Zero-state LT that the advertising market in 2019 and 2020 has been shrinking, and it has fallen to a low point after the epidemic. The growth rate of advertising revenue of Internet companies including BAT fell collectively to single digits in the third quarter of 2021, with Alibaba growing by 3%, Baidu increasing by 6%, and Tencent falling to its lowest point since 2017 at 5%.
At the same time, competition in the industry is intensifying, and platform advertising is being redistributed.
Some of the reduced traffic is shifting to short video and live e-commerce. Models such as SEO (search), video patches, portal impressions, and even in-feed ads continue to shrink in online marketing spend.
Baidu, as an established search and information flow advertisement, is in an even more awkward situation. According to industry analysts, the three pillars of MEG's revenue are: 100 numbers, intelligent mini programs, and hosting pages. Small and medium-sized merchants are distributing commissions through these three channels and Baidu. However, under the epidemic, small and medium-sized businesses have suffered blows and have had to reduce advertising expenditure, and many businesses have directly closed down. This also means that the foundation on which Baidu depends for its survival is being severely hit.
Other players don't have a good time either.
In November 2021, ByteDance laid off important localized direct sales centers in Wenzhou, Luoyang and other important national areas, and according to relevant insiders on the pulse, all local commercial teams and call centers were laid off by 30% to 70%. These sales operations are mainly for local small and medium-sized enterprises. Before this abolition, Byte had more than 20 directly operated centers in North China, East China and South China. In addition to advertising and sales, the direct sales center also undertakes the function of commercial innovation business first trial.
Zero-state LT learned that on the eve of its establishment, ByteDance had imitated the Baidu model, set up advertising sales and promotion teams in various places, and later evolved into a direct sales center, and poached Baidu talents and customers at high prices. Baidu's bidding advertising system has also needed localized direct sales for a long time to dock small and medium-sized advertisers. Now, the revenue model is also facing huge challenges.
According to statistics from third-party agency QuestMobile, the size of China's Internet advertising market in Q3 of 2021 is 158.2 billion yuan, a year-on-year growth rate of only 9.2%. However, this value has maintained a growth rate of 20% or even higher in previous statistics, and the year-on-year increase in Q2 2021 is 19.6%.
Baidu also pointed out in the third quarter earnings report that the growth rate of advertising business is gradually slowing down, and it is expected that this trend will continue for several quarters.
The trembling of the enemy in the abdomen and back is still a long way to go. Today, there are many rumors in the outside world, Li Yanhong did not put Shen Shu in the right position, and there is more laughter in the anecdotes, and the name of Shen Jidun may play a greater role in douyin, putting aside jokes, returning to the theme, leaving time for Shen Shu to try and make mistakes, there is really not much.