On Weibo, the hottest word is not celebrity gossip news events on the hot search list, but "clip." What does "clip" mean. In simple terms, Weibo content contains certain special words, sensitive words, and weibo of advertising content, which is restricted in traffic or directly invisible to users. When users browse the content, they will find that the column below the Weibo content is grayed out, and they cannot forward, comment, or like. Even at some point, "Are you caught today?" became a greeting for netizens surfing on Weibo.
The reason why this phenomenon is called "clip" is due to the "clip total" - between comings and goings, this is the Weibo name of Wang Gaofei, the current CEO of Sina Weibo. Many years ago, the abbreviation between netizens was "to always come", and "clamp" meant that there was no more under the word "come". Why Wang Gaofei will change from "coming to the total" to "clamping the total", there is quite a relationship here. It not only includes Wang Gaofei's personal personality, but also the decline of his reputation and operation of Sina Weibo in recent years. "Clip Total" is like a mirror, reflecting the glorious loss of Weibo one by one.
From "Come Total" to "Clip Total"
Wang Gaofei has a bachelor's degree in electronic computer science from Peking University and an EMBA degree from The Guanghua School of Management of Peking University, and his career has been smooth from the beginning.
In April 2000, Sina was successfully listed on the NASDAQ, and in August of the same year, 22-year-old Wang Gaofei joined Sina as an engineer in the R&D center.
In 2004, Wang Gaofei joined the Sina Wireless Business Unit and became the general manager of Sina Wireless two years later, taking full responsibility for the Sina Wireless business, while Wang Gaofei was only 28 years old at the time.
In October 2008, Wang Gaofei became the vice president of Sina Network and continued to be in charge of Sina Wireless.
In August 2009, Sina launched the "Sina Weibo" beta version, becoming the first website in the portal to provide Weibo services. In the same month, Wang Gaofei registered on Sina Weibo, nicknamed "Between Comings and Goings", and his profile was: Mobile Internet Analyst.
In 2014, Wang Gaofei became the CEO of Sina Weibo, and in March of the same year, Sina Weibo officially changed its name to Weibo, and successfully landed on nasdaq in April, becoming the world's first listed Chinese social media.
Registered Weibo for 13 years, Wang Gaofei is a well-deserved Weibo heavy user, the number of Weibo posts per day ranges from 30 to 60, only on April 6, 2022, Wang Gaofei released 47 Weibo, of course, the vast majority of which are forwarded. It is precisely because of the special identity between the comings and goings, and its high stickiness with Weibo, in the past netizens affectionately called him "Lai Zong".
However, when there are not wet shoes often walking by the river, and "Lai Zong" also overturns, in July 2017, a video pushed between Sina Weibo CEO Wang Gaofei @ came and went was deleted by Weibo administrators. Two weibo messages were sent in a row between coming and going: "Snake spirit disease, really deleted for labor and capital..." Weibo administrators can even delete the Weibo of their boss, let alone ordinary netizens. Similar overturning incidents have occurred many times, "Lai Zong" because of Weibo flow restrictions, mocking users to use Xiaomi 6 mobile phones and a series of behaviors have increasingly attracted user dissatisfaction, its credit rating gradually collapsed, and there are constantly netizens mocking its "there is no below", so "Clip Total" was born.
Weibo "resurrection"?
While "clip total" is ridiculed, user content is repeatedly "clipped" Weibo is in the same embarrassing situation, and recently, Weibo released the fourth quarter and annual financial report of 2021. In the fourth quarter, Weibo's total revenue reached $616 million, an increase of 20% year-on-year, of which advertising revenue reached $550 million, an increase of 21% year-on-year, and the proportion of advertising from mobile terminals reached 94%. In the fourth quarter, Weibo's adjusted operating profit reached $219.8 million, and its operating profit margin reached 36%. For the full year of 2021, Weibo's total revenue reached US$2.26 billion, an increase of 34% year-on-year, adjusted operating profit reached US$829.2 million, an increase of 43% year-on-year, and adjusted full-year operating margin reached 37%.
On the surface, this report card is really eye-catching, but unfortunately it can't stand up to scrutiny. From the perspective of net profit, Weibo's net profit reached a high value of $518 million in 2018, and then the net profit growth rate began to decline. Compared with the high growth rate of 210.91% in 2016 and 226.39% in 2017, the net profit growth rate of Weibo in 2018 fell to 62.18%, while the growth rate in 2019 and 2020 was -13.49% and -36.65% respectively. Although Weibo's net profit growth rate turned negative to positive in 2021, it is still only half the level of 2018.
In addition to net profit, Weibo's other two core profit indicators are also in a continuous downward trend. From 2018 to 2021, Weibo's net profit margin was 33.3206%, 27.8923%, 18.6160%, and 18.2482%, respectively, falling for four consecutive years, almost waist-cutting. On the other hand, from the perspective of ROE (Return on Net Assets), since 2018, Weibo ROE has dropped from the highest 33.32% to 13.37% in 2021.
Advertising does not depend on efficacy
As the largest public domain social platform in China, the main way for Weibo to monetize is advertising and marketing, and advertising and marketing revenue account for nearly 90% of the long term. According to the financial report, in 2021, Weibo advertising revenue reached 1.98 billion US dollars, accounting for 87.6%, of which non-Alibaba advertising revenue was 1.84 billion US dollars, an increase of 38% year-on-year. Value-added services revenue also increased by $280 million, up 36% year-over-year.
In the fourth quarter of 2021 alone, Weibo's advertising and marketing revenue reached $550 million, an increase of 21% year-on-year; of which advertising revenue excluding Alibaba accounted for about 91%, reaching $500 million, an increase of 28% year-on-year. Another portion of revenue came from value-added services, which was approximately $0.7 billion, up 9% year-over-year. This is mainly due to the "double festival promotion" in the fourth quarter, where major e-commerce platforms and brand merchants will concentrate on increasing advertising and marketing, so the traffic conversion efficiency of Weibo has also been improved.
On the other hand, Weibo's dependence on Alibaba is gradually weakening, Ali brought 40% of Weibo's advertising revenue at its peak, and In 2020, Weibo's annual advertising revenue Accounted for 10.23% of Alibaba's advertising business, and by 2021, this proportion has dropped to 7%.
What needs to be vigilant is that although Weibo advertising revenue has increased, the number of advertisers has declined significantly. From 2018 to 2020, the number of Weibo advertisers declined year after year, at 2.9 million, 2.4 million and 1.6 million, respectively. According to QuestMobile data, in the first half of 2021, short videos accounted for 42.6% of the media industry's advertising revenue, of which Douyin ranked first with 30.2%, and the proportion of Weibo social networking has fallen to 1.7%.
There are wolves in the front and tigers in the back
Internet advertising this big pie makes all the giants covet, not only Weibo, short video platforms such as Douyin, Kuaishou, medium and long-term video platforms such as B station, iQiyi, community grass planting platforms such as Xiaohongshu, are all eyeing the tiger.
Judging from the fourth quarter financial reports released by major platforms, iQIYI's online advertising business revenue of 1.7 billion yuan is the second largest segment of its revenue; station B advertising revenue of 1.59 billion yuan, contributing 27.5% of its revenue, second only to live broadcasting and value-added services. As for the short video platform, it has obvious traffic advantages. According to Analysys Qianfan data, the monthly active users of Douyin are 680 million; the daily active number of another short video giant Kuaishou reached 323.3 million in Q4 2021, an increase of 19.2% year-on-year; the number of monthly active users reached 578 million, an increase of 21.5% year-on-year, setting a new data high for the scale of Kuaishou users. Weibo's monthly life is in front of jitter, and it can only rank third. According to the financial report, in December 2021, Weibo's monthly active users (MAUs) were 573 million, an increase of about 52 million year-on-year, of which mobile MAU accounted for 95%; daily active users were 249 million, an increase of 25 million year-on-year.
In addition, the Little Red Book with a monthly active 200 million is also an opponent that cannot be underestimated. Crowley report shows that in 2021, Xiaohongshu's beauty and skin care DROs have significantly improved in quantity and content quality. The beauty and skin care industry, as a large publisher of Weibo brand advertising, is bound to encounter rivals.
Survive in the policy "sandwich"
From the analysis of the living environment, in addition to the double attack of jittering, the biggest problem facing Weibo now is policy supervision. In recent years, Weibo has gradually become the base of the star "rice circle", and its functions such as "star power list" and "spending money to buy/withdraw hot searches" have not only created traffic stars and served star fan groups, but also been deeply involved in scandals such as fundraising, which have been criticized by public opinion.
On May 8, 2021, the State Council New Office held a press conference on the 2021 "Qinglang" series of special actions, and the chaos of the "rice circle" was included in the focus of governance. Since the launch of the action, Sina Weibo has comprehensively rolled off the classification ranking of stars, CP and music in the super talk module, and strictly prohibited the emergence of the support list module in the super talk, strictly prohibited illegal fund-raising behavior, and reduced the proportion of entertainment from 40% to 25%. Wang Gaofei said that at present, Weibo's cultural and entertainment traffic is still in a recovery period, and it is expected that the traffic of the entertainment industry in the second half of this year will return to last year's level.
On March 1, 2022, the "Provisions on the Recommendation and Management of Internet Information Service Algorithms" began to be implemented, which stated that algorithms must not be used to manipulate the list to control hot searches, which undoubtedly added frost to Weibo's rice circle economy.
It is worth noting that under strong supervision, Weibo still repeatedly touches the policy red line. According to the Netinfo China public account, from January to November 2021, the State Internet Information Office guided the Beijing Municipal Internet Information Office to impose 44 disposal penalties on Sina Weibo, and repeatedly imposed a fine of 500,000 yuan, with a total of 14.3 million yuan in fines. In December 2021, the main person in charge and editor-in-chief of Sina Weibo were interviewed by the person in charge of the State Internet Information Office, and because Sina Weibo and its account repeatedly appeared in information prohibited by laws and regulations from publishing or transmitting, the circumstances were serious, and the Sina Weibo theme operation company was fined a total of 3 million yuan in administrative penalties.
Increase the community business, was filed by Douban 1 yuan
Wang Gaofei said at the annual performance meeting that the importance of community business in the Weibo ecosystem is getting stronger and stronger, and investment in this regard can promote Weibo social stickiness and activity. After the "Clear Lang Movement", Weibo deliberately diluted the color of stars and became more diversified in super-talk content, but it also triggered a "1 yuan lawsuit" with Douban.
On the evening of March 30, Douban officials sued Weibo for unfair competition, saying weibo had "long connived with users to illegally move content" and demanded 1 yuan in compensation. Douban officials posted a number of pictures related to the prosecution on Weibo, and presented evidence of Weibo's recent super talk activity "Super Talk Nova Program".
According to the civil complaint officially released by Douban, Douban sued Weibo for long-term connivance with platform users (a large number of them marketing number users who rely on traffic to profit) to illegally move content and use Douban's trademarks without authorization.
In this regard, Weibo not only left the speech of douban official micro, there was no restriction of flow, deletion of micro situation, but also responded to the matter through a Weibo spokesperson, saying that good birds choose trees and live, users flow between different platforms is normal, the Internet is open and free, not unfair competition, but also listed the previous rectification of Weibo users to carry Douban bad content announcements.
The US stock market wants to delist and break on the first day of listing in Hong Kong
In the capital market, Weibo has also been a bit difficult in recent days. On March 23, local time in the United States, Weibo was included in the list of delisting risks by the Us Securities and Exchange Commission (SEC), becoming the sixth listed company in the United States to be included in the list. Weibo needs to provide evidence to the SEC by April 13 that it is not eligible for delisting. If it cannot be proved, it will be included in the "confirmed delisting list". After the news came out, Weibo's U.S. stock price plunged intraday, falling by 7% at one point.
On the other hand, on December 8, 2021, Weibo was listed on the main board of the Hong Kong Stock Exchange for the second time, with an issue price of HK$272.80 per share, which broke at the opening. As of 16:00 on 7 April 2022, Weibo Hong Kong stocks closed at HK$204.6 per share, down 28% from the issue price.
In terms of investment bank research reports, recently, Nomura will Weibo (WB. US) rating was downgraded from "Buy" to "Neutral" and the target price was lowered from $65 to $31. Nomura pointed out in the research report that due to macro unfavorable factors, Weibo's growth prospects for fiscal 2022 are still uncertain.