Station B is indeed a controversial company.
After the release of the 2021 Q4B station financial report, all parties gave their own interpretations from different angles, and there is no doubt that the interpretations are interesting.
But there are always three core topics – has the community changed? Is there less revenue? Is turning a loss a pie?
In this article, I don't want to list boring financial report data, and try to use the meaning of data to talk about the three issues worth discussing in Station B.
First, has the user stickiness of the B station decreased after it went out of the circle?
Spitting that the B station has become an old topic, the community tone is disappearing, the user stickiness is declining, such a tone from users to investors.
But I've noticed that these points of view are usually based on their own subjective feelings and are very emotionally judged, and it is difficult to come up with evidence.
The basic feature of this argument is that it is difficult to prove and falsify if it is not carefully examined.
Over time, the inside and outside of the circle seem to have become politically correct in a sense.
However, whether user stickiness has declined or not is actually some data that can be verified, rather than relying on subjective assumptions, it is better to rely on real data.
Let's take a closer look at a few indicators -
1. User access frequency.
DAU/MAU, that is, the number of daily active users than the number of monthly active numbers, this data can reflect the user's access frequency in a sense.
The smaller this ratio, the less frequent the user access, and the larger the user's stickiness.
According to the financial report, Station B was 72.2 million daily active and 27,200 monthly active station Q4, DAU/MAU= 26.5%, while in Q4 2020, Station B DAU/MAU = 26.7%.
As you can see, this indicator has basically remained, with only a very slight decline.
2. Single user duration.
This indicator is very simple and direct, that is, the average time spent by each user on the B station, if the new user does not have the time of the old user, the single user time will definitely decline.
According to the financial report, the single-user duration of Station B in Q4 of 2021 is 82 minutes, while the length of a single user in Q4 of 2020 is 75 minutes.
It can be seen that the duration of station B is growing, that is, the new users have been soaking on station B for more time.
3. Single-user interactions.
This indicator reflects the data of the user's interactive behavior such as following, collecting, liking, coin-operating, and sending bullet screens on the B station.
In my opinion, this indicator best represents the user stickiness and activity of Station B.
According to the financial report, the average monthly single-user interaction volume of Station B in Q4 of 2021 is 139 times (average monthly total interactions/DAU), while the interaction volume of single users in Q4 of 2020 is 87 times.
It can be seen that the user interaction data of Station B has not declined because of going out of the circle.
4. Single-user revenue.
This indicator is more to reflect the efficiency of business monetization, but I think that this is actually a side of user stickiness, if this indicator increases, it means that the new users are high-value users, not low-value users.
According to the financial report, Station B's 2021 Q4 revenue is 5.78 billion, monthly active 272 million, single-user revenue is 21 yuan, and Q4 2020 single-user revenue is 19 yuan.
It can be seen that the single-user value of Station B is rising year-on-year, that is, the newly added users have not diluted the commercial value of Station B.
5. Percentage of payment.
This indicator represents the willingness to pay among the overall users, which in a sense also reflects the attractiveness of the B station to users.
According to the financial report, the proportion of payment for Station B in Q4 of 2021 was 9.02%, compared with 8.86% in the same period of 2020, a slight increase.
This payment includes other payments such as B station large membership and e-commerce.
Then we look at the penetration rate of large members, 7.18% in Q4 in 2020 and 7.36% in Q4 in 2021, which is also rising slightly.
Well, the result is very obvious.
We see that in the above five sets of data, except for the first DAU/MAU, which has a very small decline, the other four indicator B stations are up year-on-year.
Therefore, we can at least draw a basic conclusion from the perspective of data - the argument that the user stickiness declines after the B station leaves the circle does not hold up.
Considering that it still maintains a strong monthly active growth rate of 35% in the context of the stock game of the peak of the mobile Internet, the slight decline in DAU/MAU can be considered as a necessary cost of going out of the circle, which is completely within the acceptable range.
Second, why can the advertising revenue of Station B grow against the trend in the cold winter of the advertising industry?
Indeed, the financial report of Q4, the advertising revenue of Station B is a bright spot that is difficult to ignore, with a synchronous growth of 120% to 1.59 billion yuan, and the year-on-year growth rate is also an increase compared with 110% of Q3.
Some people say that it is because the base of the B station advertisement is small.
Leaving aside whether this conclusion is correct, at least this triple-digit growth is indeed very eye-catching in the overall downturn of the Internet advertising industry.
According to Questmobilede data, in the first three quarters of 2021, the growth rate of overall Internet advertising was only 9.5% of the single digits.
Alibaba's just-reported financial report shows that its core business, Taoji e-commerce marketing revenue, grew by 1%, Baidu Q4 advertising revenue increased by only 12%, iQiyi 3%, and Tencent's Q3 advertising revenue increased by only 5.4% last year.
Last year, the advertising industry experienced the rectification of open-screen advertising, the privacy adjustment of Apple IDFA, the implementation of the Personal Information Protection Law, the rectification of education real estate and so on.
These factors have directly affected the growth of Internet advertising, and the downturn in macroeconomics, especially consumer data, has also limited brand spending.
So why can the advertising business of Station B grow at a high speed against the trend?
So the base is small and high growth is unfounded, last year's advertising revenue of station B reached 4.5 billion, although there is indeed a big gap with Byte and Baidu, but in any case, it is untenable to say that 4.5 billion is a small volume.
First of all, in my opinion, the unique user population and user value of Station B is an important factor that can attract advertisers, especially brand advertisers.
Station B has been established for 13 years.
Therefore, some of the young people that Station B continues to attract have already left the campus and become the backbone of a new generation of consumption.
Their spending power and willingness are constantly increasing, and in a sense, this group of active young people who love to interact has the potential to leverage other people's consumption.
Therefore, when a brand wants to do in-depth marketing and advertising for young people, today's B station is already an unavoidable existence in a sense.
Secondly, unlike other platforms, due to its unique demographic attributes, the industries that were rectified last year, such as education and real estate, did not account for much of the advertising of Station B, and Station B attracted more industries that represented consumption upgrades and were more dynamic.
According to the financial report, games, e-commerce, 3C products, food and beverages and automobiles have become the top five advertiser industries, and these advertisers value the deep influence of B station on their target groups.
Finally, Station B itself is also optimizing its own commercial products and striving to improve the efficiency of monetization.
In the past, Station B did go through the stage of exploration at the commercial level, but today we can clearly see the management's emphasis on the commercial monetization level.
The chairman of Station B said very directly on the earnings call -
"In the past, one of the balances we allocated between user growth and revenue growth was seven or three, that is, user growth accounted for 70%, and revenue growth accounted for 30%. In the planning of this year's work, we will adjust the distribution ratio, we will open five to five, that is, user growth spends 50% of energy, income growth spends 50% of energy. ”
These emphasises on monetization are reflected in many aspects of product operation, such as the AD TALK 2021 marketing conference in December last year, which proposed the concept of "brand bank" of the commercial middle office system.
"Brand Bank" is composed of commercial traffic management system, advertising system, UP main business cooperation platform "Hanabi", of which "Hanabi" system is the core of UP main commercialization, and the brand and UP main complete free mutual selection here.
In the past year, more than 4,000 commercial order videos have been listed on the whole site, equivalent to an average of 10 per day.
Station B has explored an advertising model that balances the interests of the four parties, and allows users, advertisers, UP owners, and websites to get what they want through the deep implantation of ads by up main users.
The 23,000-like comment on the up-and-come "Milk Cake Chengjing Archives Agency" video represents the user's acceptance of the B advertisement.
As a high-frequency user of Station B and also as an advertising product manager, my intuitive feeling when brushing content is that the adsload (ad load rate) of Station B is still relatively small, and it is expected that there is room for further release.
Third, is it possible for Station B to achieve the goal of breaking 400 million MAU in 2023?
To be honest, when Station B proposed to break the target of 400 million in 2023 more than a year ago, I didn't quite believe it.
Today, however, things are changing.
According to the conference call of the B station's financial report, Chen Rui revealed that in January 2022, the MAU of the B station has reached 300 million, and at the end of last year, it was 202 million, that is to say, the MAU increased by 100 million in the past year.
Therefore, at the current growth rate, even if it slows down, it is not far from the target of 400 million in 2023.
This matter was almost unimaginable five years ago, or even three years ago, you know, three years ago, the MAU of the B station was only more than 90 million.
Let's sort out the logic behind this from other perspectives -
Let's start with the macro data level.
According to CNNIC data, China's pan-video (including long video, medium video and short video) users have exceeded 900 million, accounting for more than 80% of the overall Internet users, video content consumption has become a deterministic trend.
In terms of age structure, China's Z+ generation (that is, post-00s + post-90s + post-85s) has a total population of 490 million.
According to Questmobile's data, in the user structure of Station B, the number of people born in 1985-2009 accounted for 86%, so in the future, even if Station B does not penetrate significantly into people of higher age groups, the existing Z+ generation can also provide enough ceiling for the growth of users of Station B.
Looking at the geographical structure, a considerable part of the current users of station B are from high-tier cities (first-tier, new first-tier, second-tier), while the TOP10 of MAU of B-station is mostly developed provinces.
The management of Station B has also said that the user growth of Station B in third- and fourth-tier cities has long been higher than that of first- and second-tier cities, and Station B has the potential to continue to penetrate into a deeper market.
The above is only the macro data in the theoretical sense, let's take a look at the possible implementation path of 400 million MUA of station B -
First of all, content production determines content consumption, want to cover more people, it is necessary to produce more diversified content, B station in the past two years in the PUGC and OGC two fronts continue to exert efforts.
At the PUGC level, Station B is continuously expanding the content categories of the community, continuously increasing pan-knowledge content and women-oriented content, so as to attract audiences of different genders, occupations and age groups.
In 2021, more than 1.3 million UP owners earned income through creation on Station B, of which more than 557,000 UP owners have joined the Creative Incentive Program of Station B.
At the OGC level, in November last year, Station B announced 51 new domestic animation content in one go, and put forward the slogan of "Made for Global" of Guochuang.
Since the beginning of 2020, Station B has launched 24 works in various regions of the world, including national creations purchased by NETFLIX.
Station B has also successively produced "Little Boy", "A String of Life" Third Season, "Do You Listen to My Music" and other word-of-mouth hits in the fields of documentaries and variety shows.
These more diverse content point to a wider range of people.
The reference to "aspire to become China's Disney" is somewhat exaggerated, but it is undeniable that IP is also the content competitiveness that cannot be ignored by Station B.
Only when the content layer breaks the circle first, the user layer can break the circle, which B station thinks very clearly.
Secondly, at the product level, Station B is also constantly exploring, for example, the "Story mode" is a point of strength for Station B to meet the fragmented consumption of a wider range of users.
The Story mode is mainly based on 1 to 3 minutes of vertical short videos in the form, which is actually an expansion of the content form.
Because Station B wants to meet the video consumption needs of a wider range of people.
According to Chen Rui revealed on the earnings call, the current penetration rate of the Story model has reached 20% of DAU, and the change in form has not affected the unique interactive atmosphere of Station B, and the proportion of likes has exceeded 30%.
Station B hopes to grab more user cakes in the fierce competition and game through the actions of these products.
Let's look at a benchmark product - Weibo.
Weibo achieved 400 million MAU in Q1 2018, and Weibo's MAU today has reached 570 million, although there are differences in product form and content form, but from the threshold of content consumption, B station is not much higher than Weibo.
Therefore, in this sense, the MAU of 400 million in Station B in 2023 is also possible to achieve.
In addition to the 400 million DAUs in 2023, Fan Xin, CFO of Station B, also put forward another goal at this earnings call - to achieve breakeven by 2024.
This is also a very realistic and difficult task for Station B, which is still losing more this year.
So the question arises – will there be a conflict between the DAU target of 400 million and the break-even target?
The ideal logic of Station B is to do a good job of content, let users stay in the community, tap and meet user needs, and continue to pay, rather than burning money for user growth.
This requires a significant increase in the current efficiency of spending, and can The Chen Rui team, determined to grow and commercialize users, complete this difficult task?
Three years later, we'll see.
OK, that's the end of today's article.
To summarize briefly - this article discusses three topics about Station B from the Q4 financial report data, respectively, about community stickiness, advertising growth and user growth.
In general, the small broken station of the past, whether it is the user side or the commercial side today, is neither small nor broken.
As a high-frequency user of Station B, I am cautiously optimistic about the future of Station B.
The logic behind this is that looking at it, in the context of China's Internet entering the stock game, companies with a high probability of certainty of growth potential like Station B are actually not as many as imagined.
I hope that Ruidi, who buys back shares with real money, will not disappoint fans.
——End——
About the author: Wei Xi, producer of "Wei Xi Zhi Bei", a science and technology columnist, writes a long article, focusing on the analysis of the underlying logic of the Internet and social sciences; if you don't pay attention to this account, you don't know that you will miss the divine horse!