Dongfang selection is not only Dong Yuhui

Dongfang Xuan and Dong Yuhui demonstrated to ordinary people that the most expensive essay is far more than a thousand words.

The turmoil caused by just 700 words can not only kill the CEO of a listed company, but also kill the market value of 7 billion Hong Kong dollars. As of the close of trading on December 15, the share price of Oriental Selection has fallen by 21.99% in five trading days.

On the morning of December 16, the board of directors of Oriental Selection announced the resignation of CEO Sun Dongxu with a piece of paper. Immediately after seven o'clock in the evening, Yu Minhong clearly stood in line in the live broadcast room, saying that Sun Dongxu had a major mistake in management: "Dong Yuhui will definitely have the right to speak in the future decision-making of Dongfang Selection's career development." ”

This series of melon-eating dramas on the whole network has finally settled a little. We can briefly review how the whole thing has come to this point with a diagram:

The complex process and continuous reversal make it easy to ignore that the original fuse is actually the ownership of the original right of the small essay - this is also too intellectual.

From education and training to e-commerce, Dong Yuhui is a great contributor to the transformation of New Oriental. This young English teacher is out of the circle with his eloquence and knowledge, and his influence on social platforms is comparable to that of Yu Minhong himself.

But compared with Li Jiaqi's dazzling titles of "Beauty One Partner" and Wei Ya's "Qianxun Founder", Dong Yuhui's personal introduction is quite simple: "I used to be a teacher, and now I am a salesperson."

Dong Yuhui, who has always appeared as a worker, and now he has been robbed of credit, has already suffered too many unworthy debts in the eyes of fans. Dong Yuhui choked up and said that he "won't go" last night, on the one hand, there was the official live broadcast room of Dongfang Selection, which had lost nearly 2.5 million fans, and on the other hand, Dong Yuhui's personal account, which had gained 10 million fans.

The relationship between the e-commerce company and the anchor is still chaotic, and it is quietly floating in the cheers of fans.

Lottery tickets from above

Dong Yuhui has become the backbone of the Dongfang Selection live broadcast room, relying on the right time, place and people.

After the transformation of education and training into live broadcast e-commerce, the live broadcast room of Dongfang Selection has been very deserted. After Yu Minhong won more than 500 sales in the first broadcast, the traffic soon fell off a cliff.

He once revealed on his personal public account that the daily sales were "pitiful". 14 live broadcasts brought goods, with an average sales of only 132,000 yuan per game, less than a fraction of Li Jiaqi's one-hour broadcast.

It's hard to open the most well-known bosses, let alone the young English teachers under them. Dong Yuhui and Yoyo's live broadcast room once had only 5 or 6 viewers, and 4 of them were still parents who quietly supported the scene.

Once Dong Yuhui broadcast live all night from 1 o'clock in the morning to 7 o'clock in the morning, he talked about philosophy to art, from Mozart to Plato, and finally brought 1,400 viewers to the live broadcast room, "but I just can't sell anything, and no one pays attention to me."

The turning point occurred on June 10, 2022, when Dong Yuhui's bilingual live broadcast suddenly became popular. While writing English knowledge points on the whiteboard, he introduced the fragments of the steak, which instantly became popular all over the Internet.

There couldn't be a more coincidental time. At that time, Wei Ya disappeared, Luo Yonghao withdrew from the network, Li Jiaqi stopped broadcasting, and Simba fell into a fake turmoil. By mistake, all the big anchors are collectively absent from the 2022 618 promotion, and the traffic of the whole network is waiting for a new head.

In the first half of 2022, Douyin's Net Promoter Score (a measure of user experience) was negative[5], and turning negative into positive became the primary goal.

So in the live broadcast industry full of "family, babies, and old irons" and shouting "321 links", Dongfang Selection, who took online classes with a whiteboard, quickly ushered in the pouring of surging traffic.

Within ten days, the number of fans of Oriental Selection increased by 10 times, bringing more than 340 million goods, driving the share price of New Oriental Online to rise by more than 300%. Yu Minhong sent a private message to Dong Yuhui, "On behalf of New East, I would like to express my gratitude to you."

In the face of the splashing traffic brought by Dong Yuhui, Dongfang Selection once again stood at a new fork in the road. After the head anchor/organization relies on live broadcast to become bigger, there are generally two routes to take:

1) Take the MCN route and make money from brand merchants with pit fees and advertising. For example, the selection base has 30 basketball courts.

2) Take the retailer route and slowly replace third-party brands with self-operated brands. For example, I found a manufacturer to make 9.9 yuan toilet paper, and launched the "Xiao Yang Selection" brand of Xiao Yang and "Xin Xuan" Simba.

Obviously, Yu Minhong chose the latter.

Route issues

At the beginning of the establishment of Oriental Selection, Yu Minhong made his plan clear:

"In the future, New Oriental Online will transform into an e-commerce platform with the screening and sales of agricultural products as the core, provide value-added services for farmers across the country, and be a trustworthy platform linking farmers and consumers[1]."

The implication is very obvious, Dongfang Selection has given up the MCN route. It can also be seen from its "consignment + self-operation" model that Yu Minhong's plan is to copy an online version of Sam's or Costco.

Consignment refers to the sale of goods from other brands. In this regard, Dongfang Selection's product selection and investment promotion process is not much different from other live streaming teams.

Self-management can be understood as Oriental selection OEM sales. Dongfang selects to build its own brand, selects and purchases products by underwriting, and then sells them in the live broadcast room.

Since March this year, Dongfang Selection has begun to accelerate the launch of new self-operated brand products. The reason behind it is not complicated, the gross profit margin of the self-operated category is as high as 20%, which is 10% higher than that of the consignment goods.

In the actual operation process, some of the best-selling consignment products, such as daily nuts, beef balls, yellow croaker crisps, etc., have also been selected by Dongfang to label their own brands.

In the first half of fiscal year 2023, self-operated products contributed nearly half of Dongfang Selection's revenue. Up to now, Dongfang Selection has created 200 self-operated products.

There is an important premise for observing Dongfang Selection: it is not a grassroots selection like Brother Xiao Yang and Simba, but a listed company whose stock price has fallen from 199 to 8.

As a listed company, it is not difficult to choose whether to learn from Costco, which is $300 billion, or Ruhan Holdings (delisted), which is Zhang Dayi.

This development plan also constitutes a series of business decisions for Dongfang Selection: for example, it cannot rely on a single Douyin platform. This is also why Dongfang Selection made an App at the first time, mainly selling self-operated goods.

Yu Minhong once explained on his personal public account: The business model established based on external platforms has strong vulnerability.

At that time, Li Guoqing, who was quite accomplished in business warfare and grabbing official seals, once commented on Dongfang Selection's own app: "If it weren't for Yu Minhong, if it weren't for Dong Yuhui, I would really laugh at you."

In October 2023, Dongfang Selection will take a step forward in the direction of Sam's and launch the "Selection Member" based on its own App, priced at 199 yuan / year, which includes a number of rights and interests such as 88% off 100 self-operated products.

The intention of a series of layouts is obvious: on the one hand, it is free from the shackles of short video platforms, and on the other hand, it gradually weakens the role of live broadcasting, and leaves the repurchase in the Dongfang Selection App.

Retailers such as Sam's and Costco can replace third-party brands with their own brands because of two key points: one is to streamline SKUs and trade low-cost supply chains for low prices, and the other is to use their own market share to force supply chains to reduce costs.

In other words, the premise of Sam's and Costco's success is that they are a retail channel with a very large voice, so they can use scale to reduce costs.

But in Dongfang Selection, it is not the Dongfang Selection App that plays this role, but Dong Yuhui himself.

This makes Dong Yuhui's influence a little embarrassing in the strategy of Dongfang selection.

Helpless to stay

There is a joke widely circulated in the live broadcast industry: when a head can afford the revenue of an MCN company, the MCN boss can only marry her.

Whether it rolls over or jumps, the company's business has a huge risk of coming to naught. Countless lessons from the live broadcast industry have also proved that the "Marriage Law" is a more reliable insurance than the "Contract Law". The positive example is Wei Ya and Dong Haifeng, a husband and wife with a clear division of labor in the front and back, and the negative example is Li Ziqi, who has been fighting a lawsuit until the change.

Brother Yang firmly controls the three sheep, and Xin Youzhi is also the only boss of Xin Xuan. Li Jun, the major shareholder who made a friend, is not related to him, but he is also an old revolutionary who climbed the snowy mountains and waded through the grassland with Luo Yonghao.

In most companies, CEOs prefer to match Zhuge Liang with Zhou Yu rather than Liu Chan, and Yu Minhong, who has been the prototype of the character of "Chinese Partner", naturally knows it.

Dongfang Selection has the heart to be the Chinese Sam, but it is difficult to ignore that Dong Yuhui has always stood out from the crowd.

Therefore, in the past two years, in addition to early anchors such as Dong Yuhui, Dongfang Selection has successively cultivated a number of new anchors such as Lele, Tianquan, Chaofeng, Daqi, Tongtong, and Taotao.

At the same time, Dongfang Selection is also "de-dongning" a little bit in the operation of its own brand. The Oriental Selection Book Number once removed the label of "Yuhui Push", and the image of Dong Yuhui on Oriental Selection's self-operated steak products also disappeared.

The situation that Dongfang Selection wants to see the most, first, the influence of the major anchors is indistinguishable, so as to achieve the effect of "you don't broadcast, some people broadcast";

It's a pity that whether it is old anchors such as Dunton and YOYO, or new anchors who have been vigorously cultivated, their influence is difficult to match Dong Yuhui. And after Sun Dongxu, the former CEO who just cashed out 200 million Hong Kong dollars, angrily sprayed the fan circle culture in the live broadcast room, it also proved that everyone buys things and recognizes Dong Yuhui instead of Dongfang Selection.

Gaotu Jiapin is another company that has switched from education to e-commerce, and it has been unknown, and the audience in the live broadcast room is even in single digits. After the small composition incident, many "mothers-in-law" with Dong Yuhui's orange fan lights poured into the live broadcast room of Gaotu Jiapin, and millions of fans rose for it in a few days.

The head dilemma of live broadcast e-commerce, Dongfang Selection is difficult to overcome after all.

First of all, the core of live broadcast e-commerce is that the scale forces the cost, and the big anchor with a bright crown is almost an inevitable choice, and it is contrary to business logic to let a hundred flowers bloom.

Secondly, the anchor's emergence is indeed a metaphysics. Wei Nian failed to find a second Li Ziqi, Taobao did not have the next Li Jiaqi, and even the assistant broadcaster Qi'er, who was inseparable from Wei Ya, failed to lead the "Bee Surprise Club" to reproduce Wei Ya's success.

This is also repeated in Dong Yuhui: the data shows that in March this year alone, the average GMV of all live broadcasts where Dong Yuhui appeared was 17.45 million, a gain of 35.8% over usual [6].

It confirms the saying in the industry, "A small fire can be relied on, and a big fire can be relied on".

As mentioned above, Dongfang Selection is a listed company, and its goal is to continuously reduce the risk exposure of the company's operation and package itself as a sought-after commodity in the capital market.

However, the shareholding institution used a drop of 7 billion Hong Kong dollars to tell Mr. Yu that Dong Yuhui was the core asset of Dongfang Selection. From this point of view, Sun Dongxu spoke passionately in the live broadcast room, just like the chairman of TSMC taking the lead in smashing the lithography machine.

As a result, Dongfang Selection can only let go of unfinished attachments. In the live broadcast on the evening of the 16th, Yu Minhong described his relationship with Dong Yuhui as "small-headed father" and "big-headed son", and Sun Dongxu became the "little brother" in his mouth.

In this live broadcast, Yu Minhong said a very intriguing sentence:

"I think the original platform of Oriental Selection is unfair to Yuhui, which limits his development to a certain extent. In the future, Dong Yuhui will definitely have the right to speak in the career development and decision-making of Dongfang Selection. ”

End

In 2022, the well-known entertainment company Lehua will be listed, and fans will seriously study the IPO and find that Wang Yibo has contributed more than 60% of the company's revenue. Lehua's boss's Weibo fell, and fans appealed in unison: "Be kind to Wang Yibo." ”

At the beginning of its popularity, Yin Qiang, CFO of New Oriental Online, explained the company's profit margins far exceeding those of its peers:

"First, we really didn't buy traffic, compared with other live streaming companies, we saved money on marketing fees;

Second, we are not an MCN company, and we do not give a share to the anchors. The cost of these two pieces of our two is very low, or almost none. ”

Compared with the traditional MCN of traditional husband and wife partners, Dong Yuhui, who received an ordinary salary, and a group of English teachers let the capital market at that time see another possibility of live broadcasting.

Although the subsequent move to distribute shares shows that Dongfang Selection is willing to pay a greater cost to retain the anchor - it is definitely more generous than Dong Mingzhu. But apparently, fans think Dong Yuhui deserves more.

This young man who graduated from a prestigious university and changed from an English lecturer to a delivery anchor carries too wide a range of emotional projections.

In him, the older "mothers-in-law" saw the arduous process of rural children's struggle to gain a foothold; the middle-aged people saw the self-esteem and self-esteem of poetry and literature after being forced to transform under the tide of the times; and the resonance of young people was more straightforward, they thought of the 996 self who always hovered on the edge of the company.

When established education companies are pushed into a strange wilderness composed of traffic, fans and public opinion, Oriental Selection, which is Xi to teaching and educating people, has also been taught an expensive lesson: don't teach the audience to chase stars in the live broadcast room.

Resources

[1] The Difficulties of New Oriental's Transformation, Nanfang Daily

[2] The next stop of the New Oriental teacher, peeling onions

[3] If I were Dong Yuhui, laugh

[4] Oriental Selection-Multi-channel layout has achieved results, and the advantages of self-operated products have gradually emerged, Huachuang Securities

[5] Oriental Selection: Towards a Branded Sea of Stars, Zhongtai Securities

[6] Oriental Selection March Summary: Continued recovery after the holiday, the total GMV of the Greater Bay Area special session exceeded 100 million, Haitong Securities

Editor: Li Motian

Visual Design: Shu Rui

Editor in charge: Li Motian