After the turmoil of Dongfang's selection of small essays: Rise with Hui, learn from Gaotu and think about losing fans

Produced by Radar Finance and Economics, edited by Meng Shuai, Deep Sea

In December last year, the "small composition" turmoil involved in Dongfang Selection was undoubtedly one of the hottest events on the Internet at that time. Affected by the turmoil of Dongfang Selection's "Little Composition", the live broadcast track has also set off a new round of fighting, especially several platforms that have transformed from education to live broadcast, trying their best to carve up a piece of cake from Dongfang's selection plate.

Now, a few months are fleeting. After the turmoil, how are the three education and training giants who have successively transformed into live broadcasts doing now? First of all, Dong Yuhui, the absolute protagonist, after the "small composition" turmoil, his team with Hui has become a very rapid live broadcast rookie on Douyin, and the momentum of his peers with Hui even directly threatens Dongfang Selection. Gray dolphin data shows that in the past 30 days, the number of fans with Hui has increased by more than 1.098 million, while the number of fans dropped by Dongfang Selection in the same period reached 265,000.

In addition, the repeated commodity turmoil has also put the brand image of Dongfang Selection to the test. Following the accusation of selling fake wild shrimp and overusing shrimp medicine, Wang Hai, a well-known anti-counterfeiter, once again pointed the finger at Dongfang Selection. At the "3.15" party that had just ended, the Imperial Emblem Yuan plum vegetables and meat selected by Dongfang for sale were named again.

If it is said that the diversion of Dongfang Selection with Hui can be regarded as the transfer of its own traffic from the left hand to the right hand, then the live broadcast brands Gaotu Jiapin and Xueersi Youpin launched by the other two education and training giants Gaotu and Good Future have returned to calm. When the traffic dividends unexpectedly obtained due to the "small composition" turmoil gradually receded, the performance of the aforementioned live broadcast room once again proved that there is still a disconnected gap between these two live broadcast brands and Dongfang Selection.

Today, the self-operated and live broadcast e-commerce business has become the main business of Dongfang Selection, and the transformation business, which was not optimistic at first, has successfully "ascended" and brought considerable profits to the company. However, from June to the end of November last year, Dongfang Selection's revenue and profit indicators for the period declined to varying degrees.

Compared with the great success of Dongfang Selection's transformation, Gaotu and Good Future's Gaotu Jiapin and Xueersi Youpin have not yet had the responsibility to support most of the company's revenue. In the latest financial reports disclosed by the two companies, teaching-related products and services are still the focus of their layout. In contrast, the live streaming e-commerce business is still an innovative business or additional development opportunity for both companies.

Dong Yuhui is "under great pressure", and Dongfang Selection is caught in a commodity turmoil again

As the pioneer of the transformation of live broadcasting, Dongfang Selection is undoubtedly the leader among the live broadcast players of education transformation, and even in the entire live broadcast industry, Dongfang Selection is the head live broadcast room that can be ranked.

However, after the turmoil, Dongfang Selection has also undergone many changes compared with before, the most obvious of which is the establishment of Walking with Hui. On December 22 last year, Huitong (Beijing) Technology Co., Ltd. was formally established. Tianyancha shows that the company's registered capital reaches 10 million yuan, and the legal representative is Dong Yuhui himself.

Yu Minhong also said in the live broadcast room that the new account will not set up GMV requirements for Dong Yuhui, but more to let Dong Yuhui do what he likes. He also said that one day in the future, even if Dong Yuhui chooses to leave Dongfang Selection, the ownership of the new account will still belong to Dong Yuhui, "I will not let Yuhui have nothing when he goes out."

However, judging from the current equity relationship, Youhui, who handed over the power to Dong Yuhui, has not completely drawn a line with Dongfang Selection. Tianyan check shows that the company with Hui is wholly owned by Beijing New Oriental Xuncheng Network Technology Co., Ltd., and the legal representative of the latter is Sun Dongxu, who was removed from the position of CEO of Oriental Selection, and the beneficial owner and actual controller is Yu Minhong.

At the beginning of this year, Walking with Hui was officially launched. Although Walking with Hui is a newly established live broadcast room, under Dong Yuhui's huge aura, Walking with Hui, which has only been on the air for more than two months, has become the star live broadcast room of Douyin Live. In contrast, a series of matrix accounts promoted by Dongfang Selection before seemed to have been overshadowed by a lot of limelight.

According to the e-commerce newspaper, on March 13, Dong Yuhui revealed in the live broadcast that the team of Douyin had an afternoon meeting with him that day, and put forward a lot of development ideas and expectations to his peers with Hui, especially hoping that he would develop faster with Hui. In this regard, Dong Yuhui said that Douyin's requirements are too high, and it is fast enough to walk with Hui at present, but there is still a gap with Douyin's expectations, which makes him feel "pressured".

Since the current office space can no longer meet the needs of the live broadcast with Hui, Dong Yuhui also revealed during the live broadcast that he will move after walking with Hui. Dong Yuhui said that the warehouse downstairs was all selected by Dongfang, and it could not be used with Hui. Because of the lack of workstations, many of the team's partners can only stand and work, and even many partners and leaders can only stand at the door when they come to visit.

Therefore, in the future, he will rent a large flat floor, so that the live broadcast room, warehouse, etc. are on the same floor. But Dong Yuhui also admitted frankly that moving rent is a practical problem that he can't ignore, and the rent will soar 5 times after changing the venue, and when he opens his eyes, it is the cost of rent, which makes his pressure rise sharply.

It is undeniable that the success of walking with Hui has proved to the outside world Dong Yuhui's huge commercial value, and it has also allowed Dongfang Selection to survive the crisis again. However, from the company's point of view, Dongfang Selection, which has gradually stepped out of the haze of the "small composition" turmoil, seems to have completed and "de-Dong Yuhui" to a certain extent, but it has not fundamentally solved its dependence on Dong Yuhui.

On the other hand, the repeated product quality turmoil has also put the brand image of Dongfang Selection to the test. Radar Finance once mentioned in the article "Yu Minhong's Oriental Selection, and Wang Hai was Targeted by Wang Hai" that Wang Hai, a well-known anti-counterfeiter, has had many confrontations with Dongfang Selection, such as Wang Hai once reported on Weibo that Dongfang Selection has self-operated fake Wuchang rice, and has also questioned the existence of problems such as wild shrimp sales and excessive use of shrimp medicine in Dongfang Selection.

After this year's CCTV "3.15" party exposed that "trough meat" was used to make plum cabbage button meat, Wang Hai posted on Weibo the next day that the "Yuhuiyuan" plum vegetable button meat produced by "Anhui Donghui Technology Food Co., Ltd." exposed this time has been sold in large quantities in the live broadcast room of Dongfang Selection and Crazy Brother Yang, and the sales volume is not small. Among them, the sales volume of the product in the Dongfang Selection live broadcast room reached 53,000 orders, and the sales reached 3.17 million yuan.

Wang Hai further pointed out that the live broadcast room is the decisive factor for consumers to make purchase decisions, and it is the party that holds the pricing power, and even the party that makes the most money, can it set an example in terms of bearing legal responsibility for consumers?

On March 18, Dongfang Selection issued a statement in response to the "trough meat incident". Dongfang Selection said that Dongfang Selection said that the sales merchants and manufacturers of plum cabbage button meat said that the online sales products of "Yuhuiyuan Plum Vegetable Button Meat" did not use trough meat in violation of regulations, and promised to provide relevant certification materials as soon as possible.

Dongfang Selection emphasized that its live broadcast room is the carrier of the product, not the producer and direct seller. However, out of the importance of customers and the attitude of zero tolerance for food safety incidents, on the morning of March 16, Dongfang Selection decided to advance a refund for consumers.

At the same time, Dongfang Selection said that it will urge merchants to provide authoritative product safety related certificates as soon as possible. If the merchant cannot provide strong evidence, it will further pay three times the compensation to the consumer on the basis of the full refund in advance, and resolutely investigate the responsibility of the merchant and the manufacturer.

Walking with Hui to strongly divert the Oriental selection, Gaotu Xueersi live broadcast returned to calm

In fact, as the earliest education and training giant to transform into the live broadcast track, Yu Minhong's decision to establish the Oriental Selection brand despite the doubts of others not only opened up a new world for New Oriental, but also made a sample for many latecomers.

After Dongfang Selection fell due to the "small composition" turmoil, the opponents represented by Gaotu Jiapin and Xueersi Youpin ushered in a splash of traffic. Among them, Chen Xiangdong, the founder of Gaotu Jiapin, once worked for New Oriental, and later resigned from New Oriental to found Gaotu;

Radar Finance learned that after the outbreak of the "small composition" turmoil in Dongfang's selection, many netizens went to the live broadcast room of Gaotu Jiapin and Xueersi Youpin to ask whether they would dig Dong Yuhui. In this regard, Chen Xiangdong, founder and CEO of Gaotu, responded in the live broadcast: "Dong Yuhui is not used to dig, but to love." ”

And Peng Zhuangzhuang, president of Xueersi, also responded during the live broadcast that he was also very excited to see Dong Yuhui, such an excellent person should not just think about digging him, but think about what he can do for him and what he can help the other party.

Although both opponents clearly expressed their recognition of Dong Yuhui, when Dongfang Selection fell, Gaotu Jiapin and Xueersi Youpin, who were in a state of no one most of the time, did usher in a rare highlight moment. Not only has the number of fans in the above two live broadcast rooms skyrocketed, but the audience and sales of the live broadcast rooms have also increased significantly compared with before.

However, when the internal rectification of Dongfang Selection restarted, the popularity of Gaotu Jiapin and Xueersi Youpin slowly declined. At 15 o'clock in the afternoon of March 25th, Radar Finance clicked into the above-mentioned live broadcast rooms, the number of online viewers of Dongfang Selection was about 5,500, and the number of online viewers of Gaotu Jiapin was close to 600, while Xueersi Youpin had not yet started broadcasting. Corresponding to the former, the number of online viewers in the same period with Hui is as high as 100,000+ (Dong Yuhui happens to appear during this period).

Judging from the number of fans of the main accounts of each live broadcast brand, there is also a big gap between Gaotu Jiapin and Xueersi Youpin and Dongfang Selection. As of press time, the number of fans of the main account of Dongfang Selection reached 30.67 million, and the fans of Gaotu Jiapin and Xueersi Youpin were 2.56 million and 835,000 respectively. According to this calculation, the number of fans of the main account of Dongfang Selection is equivalent to nearly 12 times that of Gaotu Jiapin, and 36.7 times that of Xueersi Youpin.

The number of fans of Gaotu Jiapin and Xueersi Youpin is not even as good as other accounts under Dongfang Selection, such as Dongfang Selection's matrix number, Dongfang Selection's self-operated products, Dongfang Selection's Beautiful Life, and Dongfang Selection's World The current number of fans is more than 3 million. And with Hui, who was born after the "small composition" turmoil, the number of fans has risen to an astonishing 17.54 million.

The gap between the two juniors and Dongfang Selection is also reflected in the strength of bringing goods. According to the data of Gray Dolphin, in the past 30 days, Gaotu Jiapin has lost 12,000 fans, with a total sales of between 10 million and 25 million, and the performance of Xueersi's live broadcast room is relatively weaker, with more than 7,200 fans in the last 30 days, with total sales between 1 million and 2.5 million.

In stark contrast to the former, in the past 30 days, the total sales of the main account of Dongfang Selection have been more than 100 million. But I have to mention that the impact of the Dongfang Selection's "small composition" turmoil and the diversion of Hui peers seems to be continuing, and the number of fans dropped by Dongfang Selection's main account in the past 30 days reached 265,000, and the number of fans increased by more than 1.098 million in the same period with Hui's peers, and the total sales were also 100 million+.

In fact, for the change from unexpectedly out of the circle to returning to calm, Gaotu Jiapin and Xueersi Youpin also have a certain psychological preparation. At the height of the limelight in December last year, Haotian, the anchor of Gaotu Jiapin, threw this question directly to the founder Chen Xiangdong, "What if we return to the time when there are only a dozen people online in the future?"

In the face of Haodong's question, Chen Xiangdong said, "Why are you so unconfident and spineless? Forget the past, let the past become a prologue, and truly face the future. ”

At the subsequent media communication meeting, Chen Xiangdong said again, "After the heat, Gaotu Jiapin will never return to its previous state, it is a surviving company." After this wave of heat has passed, first of all, the live broadcast room will definitely not return to its previous state, there are so many fans, as long as we do the basic actions, it is a surviving company, and it will not have any problems. ”

Chen Xiangdong also revealed that in the morning, he also had a meeting with the team and said not to pay attention to what others have done, "We are still short in time and relatively small in scale, we will do our job well, we care more about customers, care more about what they are asking, and solve their problems well, and the future of Gaotu Jiapin will be immeasurable." ”

"If you don't like it, you don't worry about it", is the attitude of the anchor Orange Cheng of Xueersi to the traffic changes in the live broadcast room, "Some people say that after seeing the light, you will not get used to the darkness." Don't worry, my current state of mind is that even if there are only 100 people online at the same time when the broadcast starts tomorrow, I can still smile and say thank you to these 100 friends who listen to me, and then introduce the product and chat with you. ”

How are the three giants of education and training doing now?

From not being favored by the outside world at the beginning, to no one paying attention to it in the live broadcast exploration stage, to relying on bilingual live broadcast to unexpectedly get out of the circle, and a series of subsequent ups and downs, Dongfang Selection's performance is now enough to support a listed company.

In November last year, when Oriental Selection was not involved in the "small composition" turmoil, it issued an announcement on the Hong Kong Stock Exchange saying that the board of directors approved the sale, that is, it proposed to sell the education business to the parent company New Oriental, which means that Oriental Selection will no longer operate online education business, but become a pure self-operated and live broadcast e-commerce operator.

According to the financial report released by Oriental Selection not long ago, from June to the end of November last year, Oriental Selection earned a total of 2.795 billion yuan in revenue in six months. However, compared with the same period last year, Dongfang Selection's revenue growth rate decreased from 590.23% to 34.37%. At the same time, Oriental Selection's profit for the period also plummeted by 57.42% to 249 million yuan from 585 million yuan in the same period last year.

In this regard, Dongfang Selection explained that this is mainly due to the substantial growth of the company's business, which has led to an increase in the inventory cost and transportation cost of self-operated products. In addition, in order to expand the scale of self-operated product selection, recruit more employees for the live broadcast business, invest more sales and marketing expenses, and develop and launch the Dongfang Selection App, which also caused a significant increase in cost expenditure.

After the live broadcast e-commerce track gradually gained a firm foothold, Yu Minhong also aimed at the cultural tourism track. Last year, Yu Minhong revealed in public more than once that the company would lay out the news of the cultural tourism industry. After the "small composition" turmoil, Yu Minhong's decision to appoint Dong Yuhui as the cultural assistant to the chairman of the board of directors of New Oriental Education and Technology Group and the vice president of New Oriental Cultural Tourism Group is enough to see the importance he attaches to the cultural tourism business.

On February 29 this year, at the first New Oriental New Cultural Tourism Ecological Industry Development Conference held in Zhengzhou, Henan Province, the New Oriental Cultural Tourism brand was officially released. When talking about issues related to New Oriental cultural tourism in the interview, Yu Minhong also revealed that the cultural tourism business has expanded from a department to a group scale. According to Yu Minhong's plan, New Oriental Cultural Tourism will be listed separately and become the third listed company after the selection of New Oriental and Oriental.

Compared with the live broadcast business, which has become the core business of Dongfang Selection, Gaotu Jiapin and Xueersi Youpin are still difficult to take on major responsibilities. According to the financial report released by Gaotu at the end of February, in the fourth quarter of last year, Gaotu recorded a revenue of 761 million yuan, an increase of 20.87% compared with the same period last year. In the same period, Gaotu's net loss reached 120 million yuan, compared with the net profit of 70.61 million yuan in the same period last year.

Regarding the performance of this quarter, Shen Nan, CFO of Gaotu Group, said, "This quarter, our business has entered a stage of stable and healthy rapid growth. Cash income from our main traditional businesses accelerated, while our new business, which focused on non-academic tutoring, also showed a high growth rate. For the whole year of 2023, relying on high-quality teaching products and high-quality teaching services, our traditional and new businesses together achieved a year-on-year growth of nearly 50%. ”

Although the live broadcast business is not as mature as Dongfang Selection, this does not hinder Gaotu from competing with Dongfang Selection's "ambition". Tianyancha shows that recently, Beijing Jiazi Technology Co., Ltd. applied for the registration of a number of "Gaotu Cultural Tourism" trademarks, which are internationally classified as education and entertainment, advertising sales, website services, etc., and the current trademark status is pending substantive examination. Beijing Jiazi Technology Co., Ltd., established in February 2016, is wholly owned by Gaotu Education Technology Group Co., Ltd., and the executive director, beneficial owner and actual controller are Chen Xiangdong, the founder of Gaotu.

Since the statistical time of the latest financial report of Good Future was as of the end of November last year, the contribution of Xueersi Youpin, which only became popular in December due to the "small composition" turmoil, was not covered. In the recently disclosed financial report, Good Future positions itself as "China's intelligent learning solution provider".

According to the financial report, in the third quarter of fiscal year 2024 ended November 30, 2023, Good Future's net income rose from $233 million in the same period last year to $374 million in the current quarter, a year-on-year increase of 60.5%. However, the company was still in a loss state in the quarter, and the company's net loss reached 24.07 million yuan during the reporting period.

Commenting on the company's growth, Peng Zhuangzhuang, President and Chief Financial Officer of Good Future, said, "In this past fiscal quarter, we continued to operate our core business while exploring additional growth opportunities. ”

The three companies, which are regarded as the three giants of education and training by the outside world, are now performing differently in the capital market. As of the close of trading on March 27, the market capitalization of Oriental Selection Hong Kong was HK$21.526 billion, while as of the close of trading on March 26, Eastern time, the U.S. stock market value of New Oriental, the parent company of Oriental Selection, was US$14.678 billion, and the market capitalization of the U.S. stock market of Gaotu and Good Future was US$1.789 billion and US$7.272 billion respectively during the same period.

Some analysts pointed out that although after the "small composition" turmoil, the live broadcast rooms of Gaotu Jiapin and Xueersi Youpin once attracted the attention of many people from the outside world, but as the heat of the incident gradually subsided, the shortcomings of the two live broadcast brands also appeared. Before creating an anchor like Dong Yuhui, it was difficult for Gaotu Jiapin and Xueersi Youpin to catch up with Dongfang Selection, which is not only a problem that these two live broadcast brands are not easy to overcome, but even Dongfang Selection is difficult to reproduce the next Dong Yuhui.

However, for the unpredictable live broadcast rivers and lakes, the future is still full of many variables, what kind of development will the three giants of education and training usher in next?