Image source @ Visual China
Wen | Mirror Entertainment, author | Liang Jialie
At the end of March, Meitu released its 2021 performance report, and the financial report showed that Meitu achieved revenue of 1.666 billion yuan in 2021, an increase of 39.5% year-on-year, and a loss of 77.43 million yuan during the year, a loss of 28.8% year-on-year.
In 2021, Meitu's financial report data is still not good, and after the release of the financial report, the outside world pays more attention to "how much money did Meitu make last year", which also reflects the weakness of Meitu's main business. At present, advertising is still the main source of revenue for Meitu, and the revenue volume of VIP subscriptions and video SaaS businesses is relatively inferior.
Compared with the market value of nearly HK$100 billion at the peak of 2017, the market value of Meitu has fallen by 90%, sitting on 200 million users but the total revenue is less than 2 billion yuan, which makes Meitu's operation can be described as "bleak". In the past few years, the monetization problem brought about by the start of tool products has always plagued Meitu, and Meitu has also attacked in many ways, trying to open a breakthrough from mobile phones, e-commerce, social networking and other fields, but the ending is not satisfactory.
Meitu, who was constantly groping, was once very confused, but after folding social networking, Meitu seemed to have found a new path, that is, the focus shifted from the C-end to the B-end, and diversified the layout around SaaS services. When the outside world regards the B-side as the future of the Internet, Meitu has also opened its own way of attack.
For Meitu, the future is still uncertain, but the right way is always more reliable than "speculating in coins".
The beauty of "not doing the right thing"
In 2021, Meitu has repeatedly announced the purchase of cryptocurrencies, so most of the news about Meitu in the market is also related to coin speculation, such as "Meitu speculation has been hit badly", "Meitu speculation is addictive" and so on. For external public opinion, Meitu is indifferent, and Meitu Chairman Cai Wensheng even said: "This should be regarded as the first Hong Kong listed company to buy BTC digital currency, and it is also the first listed company in the world to use ETH Ethereum as a monetary value reserve." ”
According to the financial report, as of December 31, 2021, the fair value of the Ether and Bitcoin purchased by Meitu was about $117.3 million and $45.1 million, respectively, and meitu invested a total of $100 million in costs last year, from which the floating profit was $62.4 million, or about 397 million yuan. However, the currency circle is uncertain, which does not bring confidence to the capital market.
After the earnings report was announced, Meitu's stock price fell by more than 10%, and the current stock price was less than 1 Hong Kong dollar, and the reaction of investors was also very real: "Companies that have put the main business aside must not be touched." "In the past one or two years, Meitu has indeed had some layout in the blockchain field, but the value of the blockchain is not equivalent to the value of virtual currency, and the purchase of virtual currency is not equivalent to the layout of the blockchain, but a simple investment game."
Meitu speculation is indeed "not doing the right thing", but perhaps this is also a helpless move, the current Meitu business, there is no one who can "make a lot of money".
From the perspective of revenue of various businesses, online advertising business is still the largest source of revenue for Meitu, in 2021, Meitu advertising revenue increased by 12.5% year-on-year to 765.8 million yuan, among the remaining businesses, VIP subscription and image SaaS business revenue in 2021 was 519.5 million yuan, an increase of 146.9% year-on-year, IMS (Talent Content Marketing Solutions) and other business revenue increased by 20% to 299 million yuan, Internet value-added services increased by 51.9% year-on-year. to RMB 81.67 million.
In the past, when we talked about the profit model of many Internet companies, most of them pointed to their revenue structure is relatively single, relying heavily on a certain business, such as many Internet companies have "advertising disease", and Meitu is not the same, the revenue of its various businesses is relatively balanced, but the problem is that there is no strong business, the revenue volume is relatively limited, which also makes Meitu into a revenue dilemma.
Losses aside, Meitu's revenue volume has fallen from 4.527 billion in 2017 to 1.666 billion today, and at the lowest point in 2019, Meitu's revenue was only 1.365 billion. In the financial report, Meitu announced that the total number of monthly active users in 2021 was 230 million, and the monthly active users of Station B were also 230 million, which was comparable, but the total revenue of Station B in 2021 was 19.4 billion yuan, which was obvious.
Meitu is not trying to find a business that can make money, it has been in the field of mobile phones, e-commerce, social networking, Meitu mobile phone revenue once accounted for 90% of Meitu's total revenue, but the final results of these attempts are not satisfactory. In 2018, the revenue of Meitu's intelligent hardware business was 1.844 billion yuan, causing a loss of 500 million yuan to Meitu, after which Meitu sold the mobile phone business, and later, after the surge in operating costs of Meitu's e-commerce business Meitu Beauty, Meitu e-commerce was also strategically abandoned.
After many attempts, Meitu finally embarked on the direction of light business. In the past few years, Meitu has been involved in many businesses, but it has never found a clear business model or built its own moat around it.
C-end dilemma
A few years ago, Meitu's situation can be said to be empty traffic, but the transformation is powerless, in the Internet industry, this is not a dilemma of Meitu, Baidu Tieba is the same. As early as ten years ago, Baidu Tieba's active users reached 200 million, but until now, Baidu Tieba has not explored a sustainable monetization model.
Baidu Tieba and Meitu are difficult to change the existing many reasons, one of which is the same, that is, from the C-end, both lack of monetization genes.
In 2017, When Cai Wensheng, chairman of Meitu, talked about "how to make money in the future", the attitude is very optimistic, in his view, the Internet makes money in nothing more than games, advertising, and e-commerce, and this corresponds to the three most powerful companies in China, Baidu relies on advertising, Tencent relies on games, and Ali relies on e-commerce. Cai Wensheng believes that in addition to games, advertising and e-commerce Meitu can do: "When you have enough users, you can do anything." ”
In the past, Meitu did open its own user coverage through the product matrix composed of photo photography APPS such as Meitu Xiuxiu and Beauty Camera, and took the road of advertising, but advertising revenue is not without a ceiling, and after the Internet demographic dividend gradually disappeared, the era of relying on the user's large number to lie down and make money has passed.
What's more, relying only on advertising revenue, Meitu can't afford high-cost businesses such as mobile phones and e-commerce, so it is not a user who can be blindly optimistic.
For Meitu, one of the most critical problems at present is that the scale of users it was proud of in the past has been threatened and impacted. In 2021, the total number of monthly active users of Meitu was 230 million, down 11.6% from 261 million in the same period last year, in addition to the monthly active users of Meitu Xiuxiu basically unchanged from the previous year, the monthly active users of Beauty Camera and Meitu's first overseas product, BeautyPlus, are declining.
It is difficult for camera tools and software to form a strong user barrier, and meitu is the same. In a number of photo photography APP, Meitu's many products originally did have a first-mover advantage, but around 2020, the era of Meitu's dominance has gone, and the latecomers continue to divert Meitu's users, at that time, in terms of user penetration and growth, it is the Byte-based Faceu excitement and light face camera, as well as the no-other camera jointly launched by Weibo and Tiange.
Recently, Meitu released a set of data at the "Meitu Circle" Meitu Image Festival, since the VIP member service was launched in China in 2020, Meitu has served about 2.93 million VIP members in more than a year. Judging from the base of 230 million monthly active, Meitu's payment ratio is obviously not optimistic enough, the current light face camera, no other camera, etc. are all working on subscription services, fierce market competition, Meitu's VIP membership business for the C-end is difficult.
Of course, this is not only the problem of Meitu, the current development of the payment model of domestic tool software is not yet mature, and the prospects of most photo and photography apps are equally slim.
In 2017, Meitu hired Cheng Yu, who had successfully led the commercialization of Weibo, as a senior vice president, and then on the occasion of the tenth anniversary of Meitu Xiuxiu, Meitu CEO Wu Xinhong publicly said: "In the next ten years, we will continue to extend to social networking." Meimei and social will become the two most core strategic directions of Meitu in the future. "At that time, Meitu was pinning its hopes on the C-end, and the way it wanted to go was to shift from a tool platform to a social platform to achieve user growth and maintain high user stickiness, laying the foundation for the expansion of business models."
But obviously, like many players who have entered the social field, Meitu has also folded in social. Around 2020, wu Xinhong's "becoming beautiful" strategy has no social networking, and Meitu's goal has begun to become "planning to integrate the ecological chain of becoming beautiful in ten years", which is a signal for Meitu to turn to the B-end.
Bet on the B-side
At the "Out of the Circle" Meitu Image Festival conference, Meitu released six products, of which only Chic camera and Wink are for individual users, Meitu ID photos, Meitu Xiuxiu Mac version, Meitu design studio, Meitu Yunxiu four products are serving the B-end. This also means that Meitu's product design has begun to expand from life scenes to work scenes, from individuals to enterprises.
Among the four softwares, Meitu Xiuxiu Mac version provides picture processing and poster design services for e-commerce, new media, marketing, administrative office and other practitioners; Meitu Design Studio focuses on puzzles and commercial design of multiple scenes; Meitu Cloud provides commercial-grade intelligent imaging solutions for commercial photography, and the positioning of the four software is more subdivided and differentiated, which also reflects meitu's wide-net layout ideas when facing the B-end market.
In the B-end market, meitu's imaging and design SaaS services are not without competitors, Canva can be drawn. Facing the C side, Canva can be drawn to provide users with design editing tools and massive design templates and material content, for the B side, Canva can be painted for enterprise users to provide design services, intelligent brand visual management and online collaboration and other enterprise-level design solutions, at present, Meitu Xiuxiu Mac version, Meitu design studio and Canva can be painted Positioning is similar.
However, in addition to the canva paintable born in Australia, there are not many SaaS products that have played an influence on one-stop digital design solutions in China, such as draft design, maker stickers, etc. Most of them have not yet formed a brand effect, in addition, although the head effect of Canva can be drawn has been initially highlighted, it is also officially entered the Chinese market in 2018, and it is still in the pioneering period, for Meitu, the market survival space and upward space are sufficient.
At present, the market prospects for Canva Paintable's SaaS products are very good, and in April 2021, Canva Paint completed a new round of financing of $71 million, with the latest valuation reaching $15 billion. Of course, online SaaS products to do a good job also needs strength, the volume of the platform content material library, the scale of the platform's own designers and the quality of the content created will determine the competitiveness of the product, which is also the new product launched by Meitu needs long-term precipitation.
Since 2021, Meitu has frequently moved on the B-side. In December 2021, Meitu Holdings Industrial Internet Service Company Meidede, Which mainly provides corporate software and payment services for beauty stores in low-tier cities in China, provides one-stop solutions including tools, operations and resources for beauty stores through the overall integration of ERP, APP, Mini Program and H5 system tools. As of January 2022, Medede's financial results will also be incorporated into Meitu's financial statements.
Meitu has proposed to create a series of SaaS products that serve the "beauty industry", at present, this series not only includes imaging and design SaaS products, as well as providing digital support for beauty stores, but also includes the intelligent commercial AR makeup testing brand Meitu Magic Mirror and scientific skin measurement products based on the face recognition and image processing technologies of the Meitu Imaging Laboratory (MTLab), from this point of view, Meitu's future vision is still around the "beauty", in the "beauty" of the "beauty" The relevant industries have established their own ecological chains.
Nowadays, Meitu's SaaS service is still in its infancy, the future of its layout in various fields should continue to deepen, expand user and product influence, and constantly connect upstream and downstream partners, it can be said that the future Oftu to go is still a long way, however, compared to the previous follow the Internet outlet to do e-commerce live broadcasting, do social, the in-depth layout of SaaS services is the choice to return to Meitu's old bank, but also in the eyes of shareholders more reliable "business".
In fact, the transformation of Meitu is also a microcosm of the development of the entire Internet industry, today, the outside world generally believes that the past decade is the golden decade of the Internet industry TO C, and the next decade, the Internet into the second half, B2B industry Internet golden decade is coming. At the time of industry transformation, Meitu's strategic decisions are worthy of recognition, but it remains to be seen whether it can successfully achieve strategic landing in the future and make SaaS services bigger and stronger in practice.