Abstract

Interesting headlines and fighting for more in the U.S. stock market soared, Tencent as the two major investors, the harvest is not only financial returns. Under the flow anxiety, the counter attack of interesting headlines and many spells can be called the stage victory of Tencent's sinking strategy. But their outstanding problems and risks may also bring disaster to Tencent.

Author Ma Ma Cheng editor

On Sept. 14, the headline was officially listed on Nasdaq, soaring nearly 130% daily, to 191.29%, and trading was suspended five times after touching the fuse mechanism. On the first day, it closed at $15.97 /ADS, and its market value was close to $4 billion 600 million.

Prior to this, the stock price of Pingduo has soared more than 50% for three consecutive days, with a market capitalization of more than 360 and Netease, ranking sixth among China's Internet technology companies. The market value gap between Kondo and Jingdong narrowed to $7 billion, which is equivalent to about two Sina Weibo and nearly 11 Sogou.

Two companies focusing on the third and fourth tiers and the sinking market, Jiduo and Qiao, used "three years" and "two years and three months" respectively to stand on the international stage and become the black horses in the shares of CITIC. According to media reports, the fast hand has also launched a listing plan in Hong Kong. Tencent, as a common investor behind them, has won the first battle in the sinking market.

Tencent, as a major investor in the "three giants of the sinking market" that have made a lot of headlines, is fast-moving and interesting. Tencent has been in the sinking market since very early on. From the Tencent daily report, the growth of the game slowed down, and the growth of WeChat and QQ users hit the ceiling. Recently, not only is the regulation of the game business tightening, but also the entrepreneurship and investment of social applications have become a new breeze, began to re-energize, to challenge the national social application Wechat.

To go to the low line city and expand the number of users is the only way for Tencent to solve the current traffic anxiety. No matter how disdainful the "Five Rings" crowd is, this is China's objective reality - the number of cities below the third line of the population of about 1 billion, Internet companies need to develop a treasure spot, will also become the focus of a new round of horse racing enclosure.

However, in the process of rapid development, the three enterprises relatively rough development model, but also exposed many problems. As an information platform, the values conveyed by the content of Fast Hand Platform have been criticized by the mainstream media and regulators many times; the most frequently criticized is the proliferation of counterfeit goods. Before the listing of Fast Hand Platform, it once attacked counterfeit goods, causing serious losses to some merchants, and even protested in front of the headquarters office building of Quitou. Interesting headlines are vulgar in content, and the pattern of obtaining cash by early cash subsidies is also different from pyramid schemes.

Yu Minhong, chairman of New Oriental Group, gave a speech at the Summer Summit of the Asia-Buri Forum in late August, in which he commented on companies like Dodo, Alibaba and Tencent under real names, saying they were "taking advantage of the low taste of the Chinese people who like to buy and sell things and gossip about each other."

Yu Minhong believes that a technology company has created a real impact on the world's scientific and technological products is powerful, artificial intelligence and other products are likely to spawn a world-class, China has the advantage of big data, but whether it can get up depends on the height of Chinese entrepreneurs, if not high enough, still. We want to make money from the vulgar tastes of ordinary people. We still can never get up.

One

Abacus of Tencent

As a strategic investor, Tencent's traffic and resources have become an important attraction for the company to "win" more, interesting headlines and fast hands.

On the one hand, Tencent's Weixin ecology can provide a moat for both e-commerce and content platforms it invests in. Based on the ecological outbreak of Weixin, Pingduo has undoubtedly been strongly supported by Weixin, directly threatening Taobao and other traditional e-commerce. Interesting headlines are standalone APP apps, but their "apprenticeship" model, by inviting friends to register and constantly read content for more subsidies, also relies on Weixin platform for social fission.

Interesting headline CFO Wang Jingbo mentioned to all weather technology, "Tencent as a strategic shareholder, can provide a lot of resources, including the content of the ecosystem, but also the source of traffic. These are of great help to us. "

Conversely, the interest in the headlines, fight more, fast, for Tencent, in addition to financial returns, but also in its investment layout has strategic significance - cut into the city below the third line, to obtain new traffic, access to new liquidity space.

Tencent has penetrated into a wider range of people with its interesting headlines, multi-tasking and fast-moving products that are rapidly becoming popular among users in cities below the third tier. If more successful, further development of the micro-messaging platform in the sinking market and social e-commerce direction of the possibility, will attract more e-commerce settlements.

Tencent's traffic growth pressure is visible. WeChat, QQ two super social networking applications App, user growth basically hit the ceiling.

Game business, in March this year, due to the adjustment of the game approval authority, version number approval has been suspended. This is a direct blow to Tencent, which relies on the purchase and advertising of game props to commercialize cash. Tencent's traffic advantages are hard to play. At the same time, Tencent's latest Wegame platform, due to regulatory problems, on-line a few days later encountered the shelf. Under the double pressure of regulation and revenue, the ceiling of Tencent Games has appeared.

According to Tencent China News, Q2 Tencent's smartphone game business revenue in 2018 was 17.6 billion yuan, down 19% from the previous year. Tencent explained in the financial report that "the main reason is that the popular tactical games have not been commercialized and the release schedule of new games has not been affected."

According to the Tencent survey, in 2017, users in the sinking market demand for online reading, online watching video, online listening to music, online games, broadcasting and other aspects are higher than the overall level of mobile Internet users. Tencent's related products are still mainly concentrated in the first, second and third-tier cities. Tencent needs more channels to increase the strength of the downward market.

On a higher level, Tencent has a lot of fun headlines and a quick hand. It is also the two powerful tools to check and balance the two rivals, Alibaba Group and today's headlines.

With the upgrading of the AT war, the layout of Tencent in the field of electricity supplier is very important. In less than three years, GMV has exceeded hundreds of billions of dollars a year. According to GMV, it has overtaken Jingdong and ranked among the top three e-commerce platforms in China. Some investors have commented that "Taobao monthly life of 4-5 billion, WeChat monthly living 9-10 billion. About 500 million of the difference is a vast space for more development.

From Taobao's introduction of special edition Taobao and other measures, it has no worries about the rise of many spares. And the future is also likely to be directly against Taobao. Huang Emei, founder of Pingduo, once told the media that Pingduo and Taobao are competing in dislocation, competing for different scenarios of the same group of users; Pingduo multi-target users are the Chinese people, not just the "five rings" crowd.

Since 2018, headlines and its products such as shaking sound and watermelon video have exploded rapidly, occupying the user market strongly and constituting a clear threat to Tencent. The competition between the fast hand and today's headlines has reached the stage of becoming white hot. Interesting headlines quickly surpassed a number of established information platforms in two years, becoming the second most penetrating information application after today's headlines. Interesting headlines mentioned in the prospectus to create a "pan-entertainment content platform," and has developed short videos, novels, animation and other related functions. At the same time, the Interesting Headline CFO also mentioned that after listing will continue to recommend optimization algorithm, the future does not exclude to "five ring" crowd promotion. Interest headlines are seen as a counterweight to Tencent's headlines today.

Two

Other possibilities of WeChat ecosystem

A lot of success is also a successful test of WeChat's social networking. For Tencent, WeChat ecosystem needs more start-up companies to revitalize.

In addition to many spells, WeChat ecosystem's fission ability in the community and sinking crowd has become a sharp weapon for many emerging businesses to overtake. Many start-ups have even given up building their own stand-alone applications, using Weixin applets as their primary platform.

Emerging small-program e-commerce, such as SEE small stores, good stuff full warehouse, quickly gathered vertical user groups in third and fourth-tier cities; and the baby learning English and other mother-to-child products, parent-to-child education payment community, is also expanding at an alarming rate of fission; there are also new entrepreneurship projects from social sharing to e-commerce. Eyes.

Behind these explosions, most of them are Tencent investment. For small businesses based on small businesses, Tencent investment is relatively cautious. Tencent invested in the SEE small shop C + round of financing when the choice to enter, before its stores have been Sequoia China, Betelsmann Asia Foundation (BAI) and many other well-known institutions favored, and get multiple rounds of financing.

In 2018, according to the official data of SEE small stores, there are currently 2,000 + brands in the upstream supply chain, and in the downstream, small stores have partnered with 5,000 + self-media, including Xicha, Langlang, Coldplay Laboratory, Whale Face Seminar, Fashion, Eclipse Diary and other self-media. There are more than 10 million registered users of small shops. At this stage, the number of GMV per month is tens of millions.

It can be said that SEE small shop in Weixin set up a small program e-commerce platform, which for Tencent, contribute to their own Weixin ecological perfection.

Previously, according to 36 Kr reports, Tencent plans to increase advertising revenue to 30-40% of the company's total revenue in a few years, and Wechat will be the main advertising revenue position. The upsurge of entrepreneurship based on small programs and third-and fourth-tier markets has taken shape. For Tencent, it can further enhance the activity of the Weixin community and increase the overall advertising revenue of Weixin.

However, there are few people who actually run through the entrepreneurial track with a focus on the three cities below.

Su Ziming, director of investment at Ino Angel Fund, also said, "Many small program companies that took financing, except for the liquidity model as clear as Jiduo, other relatively early, business model has not closed loop. Many small programs have no problem with product logic. They accumulate a lot of users in a short period of time, but how can they keep the users who accumulate in a short period of time? How to make money by commercial logic? I don't think most of the applets have come this far, and the founders probably haven't thought about it.

Tencent as a platform to invest in related projects, although both as a referee and as an athlete has been one of the industries, at least this advantage does help Tencent quickly find the right investment targets.

Three

Hidden worries behind opportunism

In the sinking market, there are many problems and problems that need to be solved urgently.

Since listing, a lot of products have been questioned by public opinion for fakes.

At one time, a large number of counterfeit products related to international brands, such as imitating vivo vivi, imitating SAMSUNG SVMSUNG, imitating Sony's "Sony TV" and "Sony 4k" etc. There are many products that are not in good quality, such as deteriorating fruits, bad diapers, etc. After the listing, many of them were put on the side of the spotlight and apologized.


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