Flow sinking era

At the end of last year, Zhang Hongtao went to Hanzhong, Shaanxi. On the shelves of the shopping malls, inferior clothes and 25 yuan pairs of shoes were everywhere. What I thought was a lot of things, which is common here.

Zhang Hongtao has lived in Beijing for many years. In 2017, his identity was also the vice president of Youku, responsible for the live broadcast. After coming out of business, the biggest problem he considered was that the traffic dividend disappeared and the speed of Internet radiation showed an edge effect. He must look for people who have been neglected in the past, small cities and even villages outside the first and second tier cities.

In the venture capital circle, these places have a more popular name – sinking the market. The success of the fight and the fun headlines have caused the market to suddenly increase its gold content.

Zhang Hongtao tried to stand in the other’s perspective and ran to communicate with them. He found that on the edge of the Internet world, what really surprised him was not the material gap. The group has a broader meaning here, and after that, the square dance has already started. The leader of the square dance has a face, a fierce look, and became the absolute authority in the square. As a bystander, Zhang Hongtao even felt that these players were not dignified, and he wondered why these people did not leave.

Later, he understood that in such an “acquaintance society”, leaving a stage to a certain extent means being isolated in some aspect of life. For Zhang Hongtao and all entrepreneurs who live in the front line, it means subtle differences in social and content needs.

It is also Qin Tong who is willing to be so stupid. Before the Spring Festival last year, he traveled to more than a dozen counties in the southwestern provinces and visited more than 500 people. Their ages ranged from 35 to 55 years old. This is a typical user of his previous entrepreneurial projects. He looked at their mobile phones and found that 80% of the respondents were at least in a relationship with one of the opposite sex.

To his surprise, more than 80% of their mobile phones have installed the calendar software. Prior to this, the Chinese perpetual calendar, which claimed to have received $25 million in financing from Lei Jun, has exceeded 300 million users. Heavy users even installed three or four calendars, compared to the use.

“The market is really big, and the number of people is half of the Internet.” Zhang Hongtao added a lot of friends who lived in the third- and fourth-tier cities. “The third and fourth-line people are a treasure, but everyone must find the entrance, which one? The demand point is in line with their appetite.”

The cut point is the key. Because the real market gap is not much, the giants are sinking more and more, how to find a gap between the giants has become the survival rule of many entrepreneurs.

“There is not much room left for entrepreneurs.” Zhang Hongtao hopes to provide consumers with an online entertainment mode beyond the third and fourth lines. He also knows that online entertainment has been occupied by the headlines and the vibrating hands, and the texts are short. The application of the national product banner, and even most of them started in the sinking market.

“Everyone is a little overestimating the growth ability of this track itself. Only at the very core track will the opportunity be born, or it will be captured by the giants and existing big companies.” A mainstream fund investor Said to the “Financial World” weekly.

This is a frustrating argument. The popularity of smartphones and WeChat has long rushed this group online. However, in-depth understanding still brought hope to Zhang Hongtao. He found that the users he faced were so white, and even many users even had problems downloading. Zhang Hongtao went to observe their mobile phones and found that they were two extremes, or they were particularly clean. There were no mainstream applications except WeChat; or they were downloaded indiscriminately, and the light application store was five or six.

But the advantage of Xiaobai is that they are more concerned about Xiao En Xiaohui, and it is easy to be attracted by some routines of the Internet. In 2017, Zhang Hongtao launched the Youle App. In the official introduction, it is defined as a pan-entertainment short video app with health as the keynote, happiness as the appeal, and community making.

But open the main interface of the friendly music, the function of this product is almost exactly the same as the vibrato. It’s just a very important function than the vibrato. Every time you watch a video, you will get a gold coin reward, and 10,000 gold coins can be exchanged for 1 yuan.

But from the content point of view, Youle still has its own “features.” When the first capital of Wang Chuanhui, Wang Yuhui, touched Youle, the first reaction was that there would be no friends around. He felt that he had opened up a world he had never perceived, that neighborhood disputes, worries and grievances were short, and that the life and circles he was in contact with were incompatible. Zhang Hongtao spent two hours discussing with Wang Yuhui about the needs of people and products in the sinking market.

Zhang Hongtao has no longer been unfamiliar with the group through field research. This is a group of people who originally watched the audience, readers, and stories. From 8 pm to 12 pm, they have a lot of time to fill. Moreover, before joining Youku, he also made a live broadcast of the video. This is an online show, most of the performances are Lolita female anchors, the old uncle is the gift. Relying on the live show, 呱呱Video’s revenue in 2012 was as high as 580 million yuan.

This misplacement is ubiquitous. The people who provide services for the three- and four-line sinking markets are often entrepreneurs in first-tier cities such as Beijing and Shenzhen, and their perceptions of real users are inaccurate. Zhang Hongtao found that users often think that good things are not necessarily enjoyed by users.

One of the problems with the video at the time was the upgrade of the version. When the official version was upgraded to 5.0, many users were still using version 1.0 released four or five years ago. This is a crashing thing, because every time the product is developed, in addition to the new features, you have to consider the compatibility of the old version, adding a lot of work.

GG Video is a short video platform based on user originality, but Zhang Hongtao found that there are a few users who can produce content. He optimized the music material and beauty tools for short videos, and even provided the user with scripts and templates. After the filming, the platform made a red envelope. Zhang Hongtao has spent a lot of effort, and the number of end users has not exceeded 1 million. “We have done everything we do.”

Information asymmetry has always existed. Chen Yuhao went to the barber shop not long ago. The boss also asked him if he knew Bitcoin. He had just bought more than 10,000 yuan of virtual currency, and Chen Yuhao’s brother-in-law in Hangzhou had three or four years of experience in coinage. Many local businesses don’t know that the threshold for advertising in a circle of friends only needs a few thousand yuan to open an account. “They think they have millions of dollars.”

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From Beijing West Railway Station all the way to the south, Zhengzhou, 700 kilometers away, the hot-spot construction site is running all the year round. Henan is the province with the largest agricultural population in the country. The huge population base has brought employment opportunities and business opportunities for the Central Plains city. Just, starting a business here, except that the air is consistent with Beijing, everything else seems to have insufficient advantages. It is ignored by mainstream venture capital, lacking Internet talent and policy support.

But if you want to sink here, you will find that the market is not an empty gap. There are no well-known Internet companies in Henan, but there is no shortage of Internet practitioners.

The traffic business has been in the sinking market for a long time. A large number of people engaged in Internet operations are active in the online market. Through the primitive and rude ways, they profit from operating traffic. In recent years, there has been no shortage of legends about financial freedom.

In 2013, after graduating from Chen Yuhao University, after a guide from Xiamen friends, he made a WeChat subscription number with several friends in Zhengzhou. The team of 20 people operated more than 60 accounts, each of which was involved in the vertical field, covering emotions, military affairs, Gossip. Their approach is simple and rude, and most of the content is handled directly from the Internet or simply washed.

The constant flow, the platform of the flow, the opportunity is in the migration of the platform. Chen Yuhao caught up with the WeChat bonus period, an article similar to “the world’s most cattle wedding team”, can read one or two million a day, the WeChat public account at that time still shows the reading in real time, now with 100000+ Alternative. Tencent has not even had time to open an advertiser. Chen Yuhao received the advertisement himself. Ten thousand fans sold 500 yuan and were deleted after 12 hours on WeChat. Later, because of the ownership structure, he left the original team, and the micro-signal that he had assigned to him had not been taken care of for a long time, and the fans were running out. And one of them, who was born in 1994, has already opened a Ferrari.

Looking for cheaper traffic in the vast world, this is the original intention of this round of sinking, but there is a shadow of the giant wherever you go.

In June 2018, Chen Yuhao started his red envelope entrepreneurship project and made a software for the leisure crowd to grab red packets. The underlying logic of this project is the same as the fun headline, but compared to looking at the information can make money, Chen Yuhao’s red map is more simple and rude, directly to the user through the advertisement to send red packets.

The typical scenario is that the merchant’s small red envelope appears on the user’s mobile phone map, and after clicking the collection, he jumps to the merchant’s advertisement page and becomes a fan of the store. It’s equivalent to spending a few cents to ask a user to see an ad. Most of these ads come from advertising networks of Baidu, Taobao and Tencent, which are distributed to places that have traffic to the entire network. Prior to this, similar practices have been proven to be practical.

Looking for cheaper traffic in the vast world, this is the original intention of this round of sinking, but there is a shadow of the giant wherever you go. Zhang Hongtao’s project is difficult to get rid of the dependence on WeChat traffic. The spread of Youle was originally based on the WeChat applet. Although the small program benefited from WeChat traffic, it had many rules and was easily removed. The video loading speed was slow, and there was often a delay of 5 seconds, although it was later preloaded. There will still be a one second delay.

The experience of the applet is not as good as the native app, but when he tried his best to migrate the users of WeChat to the app, the effect was very bad. He found that in this market, optical transmission of the verification code will kill 80% of users. Eventually I had to use WeChat to log in.

Like many startups that are sinking in the market, their teams are in first-tier cities such as Beijing and Shenzhen, and most of the people in service are in the third and fourth lines and in more remote rural areas.

“The sinking market is almost the WeChat Internet.” Zhang Hongtao divided the development stage of the Internet into the PC Internet, the mobile Internet, and the current WeChat Internet. Smartphones let many people first come into contact with the Internet, and their most important position is on WeChat. Zhang Hongtao concluded that these people built a group without saying a word, and then forwarded various rumors and paragraphs.

This is also the main battlefield for the proliferation of fun and interesting headlines. Both companies have received strategic investment from Tencent.

On January 14, 2012, the TV series “Country Love Story 5” was held in Beijing. The most broadcasted content on Tencent’s video was not “Dwelling House” and “Struggle”, but “Country Love Story”.

UU errand founder Qiao Songtao is also a master of traffic. Before the UU errands project, WeChat’s rules are still not perfect. Qiao Songtao registered more than 8,000 micro-signals, and added friends with technology to add one or two million fans. Then hire one or two people to use the machine to send a circle of friends every day, making these numbers look like a normal account. Even so, many numbers were micro-envelope numbers, leaving only a thousand.

He recently tested a project. He spent an hour or two working on thousands of users, all of whom were young people in the town, which he saw as the power of WeChat group operations. “Through the operation of WeChat group, it is very easy to kill the US group in the third- and fourth-tier cities.” Qiao Songtao said, “Chinese Internet companies have not cultivated any such people with community-operated genes.” The US Mission, or Ali, is given priority in the scale of replication.

A similar incident occurred at the junction of Chaoyang and Tongzhou District outside Beijing’s East Fifth Ring Road. It is adjacent to the Communication University of China and has gathered many cultural media companies. Qin Tong smoked a cigarette and tried to keep the mystery, saying that it was “worry development.” His business includes online literature, games and public account operations.

Like many startups that are sinking in the market, their teams are in first-tier cities such as Beijing and Shenzhen, and most of the people in service are in the third and fourth lines and in more remote rural areas.

Many investors don’t understand that the secret of a traffic business is operations, not specific products. An investor found Qin Tong at the end of 2015 and hopes to learn about this new group through their projects. Investors have been wondering why online literature is so popular in the third and fourth line of sinking people.

In early years, Qin Tong did a web-based business in Weibo, Post Bar and QQ Space. Later, he registered more than a thousand WeChat public accounts. The novels of online literature came from contracted authors, but the content of WeChat public account was more for submission or handling. Today, Qin Tong’s project has accumulated hundreds of millions of users in online literature, and the public number of fans has accumulated tens of millions.

Most of the infrastructure of the Internet world can only be built in first-tier cities, social, search, e-commerce, etc. Qin Tong refers to these tools as useful products. “What’s interesting is high frequency, and all of them are low frequency. We focus on doing interesting things.” Qin Tong said, first grab this crowd and then realize it through WeChat matrix, e-commerce and games.

The popularity of mobile payments and the absence of Baidu in the sinking market gave them the opportunity. Relatively speaking, this is the “blank market” of the Internet and business. In first- and second-tier cities, heavy users of the Internet have their own channels of information acquisition, which is relatively more critical. “For example, first- and second-tier cities have lower payment rates because they have more access to information.”

For many third- and fourth-line users, WeChat is the only source of information they get. When a web novel appears in a group chat, many people are willing to pay a small amount for this product that is pushed to their eyes. The cost of getting more content.

The third and fourth lines even have a unique WeChat ecology, just like many village hawkers selling “Kang Shuai Fu” and “Da Bai Free”. The WeChat in these places is also full of station numbers (using nearby people, simulating site addresses) ), group control (one computer controls hundreds of mobile phones) and malicious tampering with WeChat architecture, the black industry chain is rampant, “the inside is bad money to drive out good money.”

In June 2017, WeChat officially shot, specifically against these violations, sealed a large number of micro-signals. But in Baidu, you can still see search ads such as “one-click group control hundred mobile phones, monthly increase of 300,000”.

Zhang Hongtao feels that he has to pay a higher cost to do the work here. He said that he cares for the WeChat users as their own App users, treating the users as friends, but the users are growing slowly.

On September 14, 2018, local time in New York, USA, the headline was listed on NASDAQ.

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Lying at home, you can make money with a little mobile phone, which is described by many people as the most painful point for sinking users.

Time has become quantified money, clearly marked. In fact, the revenues of these users can be exchanged for a small amount of money. For example, in the headline of interest, 1600 gold coins can be exchanged for 1 yuan, and users can only get 10 gold coins for reading a piece of information. The speed of reading one message per minute can earn up to 600 in one hour. Gold coins, converted to less than 5 cents. According to the rules of each platform, if you don’t help them pull in new users, you can earn less than 10 yuan a day on the fun headline.

Of course, there are also stories of riches in the official propaganda examples. On the profit leaderboard of the fun headlines, the number one user has earned 390,000 yuan through the fun headline. He also brought more than 70,000 people to the headlines, and an ordinary person may not reach 70,000 people in his lifetime.

The red envelope mode is often simple and effective. Zhang Hongtao found that these groups have little resistance to Xiao En Xiaohui. Since the launch of the red envelope system, Friends has seen a significant increase in playback and sharing.

Zhang Hongtao returned all advertising fees to the user. Youle provides advertisers with one thousand advertisements, which is less than 5 yuan. That is, a user can only earn 5 cents if he watches 100 advertisements a day.

“Money is just a icing on the cake, it can’t be turned upside down.” Colleagues urged Zhang Hongtao to increase the investment in red envelopes, which means platform subsidies, he refused this practice. “The core is to let users see the content, not the red envelope.”

Ten years ago, when group buying websites including the US group were popular in China, the main means were through discounts and subsidies. Many people worry that if the discount does not exist, it is good to go. This situation is indeed happening, but most people have changed their consumption habits after this habit has been cultivated.

But the problem is how to use the content itself to let users stay, UGC content is particularly challenging here.

When Chen Yuhao was eager to make a red envelope advertising software, the Jasmine community had already invested in innovative workshops. Three or four months later, the Jasmine community was taken over by Jinshajiang Ventures, where Zhu Xiaohu was located, with a valuation of 4 times. Later, the valuation was doubled and was taken over by Sequoia Capital.

However, according to a person familiar with the matter, like the Friends, the development of the Jasmine community, which relies mainly on UGC content, did not meet expectations. “Investors originally thought that short audio would become a big market like short video.”

The Jasmine community is equivalent to the fast version of the voice version, which is mostly third- and fourth-line women. Through three minutes or so of voice, they told strangers about emotions and emotions, such as “Who can I understand?” “A man who refuses to marry you is not enough to love you.” “Derailment should be forgiven?” The content of the user can be seen everywhere, and the geographical location of the user is mostly the third- and fourth-tier cities such as Liupanshui, Zhangzhou and Baoding.

Xu Tianmu, the founder of the Jasmine community, worked in Sohu Changyou. After a round of entrepreneurial failure, he also suffered a marriage defeat. Born in a small town in Shandong, he found that people in the third and fourth tiers and in more remote areas, especially women, have a huge appeal to their emotions. The relationship between mother-in-law, neighbors and children is interesting and diverse.

Just like many people living in cities, it is hard to imagine that a large part of the traffic in today’s headlines is the topic of three rural issues. The most broadcasted content on Tencent’s video is not “Dwelling House” and “Struggle”, but “Country Love Story”.

The Jasmine community has also tried to get the headlines of the guest model, relying on the red envelope incentives, bringing users a short-term rapid growth. And once the red envelope subsidy is stopped, these people will also recede. How to meet their needs outside the red envelope has always been the direction that entrepreneurs are struggling to find.

“Our business model is not particularly mature. After the user comes over, it can’t create too much value. The more users, the bigger the loss.” The cost of pulling the new red figure is 10 yuan, and now it has dropped to two. On the line for several months, the red map has more than one million users, and the daily life is more than 100,000. Chen Yuhao decided to stop the promotion before the new version.

His local push is to find the owner of the store. Most of them operate clothing stores and supermarkets in the county and city, and post the QR code at the door of the store. Each time the user registers with the store owner, the subsidy ranges from 1 to 10.

In Chen Yuhao’s view, it is not difficult to get customers in the sinking market. His first batch of seed users is the company that spends money to find the company. The cost of 10 yuan is new in local universities.

Unlike other people, Chen Yuhao believes that as long as the fans come over, they can find a method of realizing. He believes that the character of this group is accurate, they love to take advantage of small, but also have purchasing power.

This summer, Chen Yuhao and his friend opened a barbecue shop in Zhengzhou. The friend was a traffic policeman and had resources. However, the barbecue shop closed down in three or four months. He lost 110,000, which made him see the offline store. difficult. In the local area, the store is open to find a band, either to send a single page, or to send a circle of friends, Baidu and today’s headlines are expensive and inaccurate for them.

This allowed Chen Yuhao to decide to put the merchant’s coupons on it, which not only solved the problem of local offline stores, but also extended the user’s consumption behavior for the red map. For example, consumers can put coupons on the platform exchange. He strives to make users understand and adapt, and users who don’t want to do anything but want to grab red packets to make money can earn a very limited amount, and those who are willing to do some tasks, including sharing friends, filling out questionnaires or downloading a client. , can get more generous returns. “It’s better to get it through your own labor than to lie down and make money.”

For investors, this is obviously just a small business, lacking the imagination to grow.

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As an Internet company born and raised in Zhengzhou, UU errands can grow up and surprise many people. In the Zhengzhou office where UU ran the leg, there was no place for employees to meet, and they were crowded on a long and narrow table behind the front desk.

Founder Qiao Songtao is a rare technology-born entrepreneur. Before doing the UU errands project, he was a typical otaku, sleeping at 6 in the morning, getting up at 12 noon, often not going out for a month, and not going back three meters from the office.

Qiao Songtao was easygoing, smoking a cup of tea and a leg on the arm of the chair. His speaking speed is very fast, there are questions and answers, there are not so many public relations routines and scruples. When he learned that we were going to understand the situation in the sinking market, I specially got up and took the mobile phone and opened his mother’s WeChat avatar – a cute expression pack, next to it: Baby, come over the mother hug. This shows how primitive and simple this group is.

After graduating from Qiao Songtao, he caught up with the booming period of the Internet and provided support for those who did not understand web technology. He received a monthly fee of 10 yuan. In 2006, Qiao Songtao returned to Zhengzhou and did a lot of community and social software. At that time, the bandwidth cost in Zhengzhou was only one tenth of Beijing. But for five years of socialization, nothing has been done. In his own words, he made money at the university, went to Beijing toss, and owed 200,000 debts back to Henan.

In mid-April 2015, UU ran his leg and Josong Tao invested 2 million yuan. When the first financing reached 10 million yuan in half a year, the previous investment of 2 million yuan has not been spent. When the O2O vent was raised, the errands project was once the capital of the capital. Today, most of the similar projects in Beijing and Shanghai have disappeared. UU errands are a few entrepreneurial projects outside the first-tier cities.

Compared to Flash, Dada and other similar projects, UU ran legs are not as good as theirs. The situation that Qiao Songtao often encounters is that investors ask him why Beijing has no business. His business focus is on second- and third-tier cities such as Zhengzhou. There are few opportunities for investors to come into contact, and many people even suspect that his data is fraudulent. He is also starting his errands business in Beijing, but more like a means of reaching out to capital and the market, “Beijing is a facade.”

The local capital does not make much sense to them and they cannot endorse them. But mainstream funds have a natural distrust of this unfamiliar project that is unfamiliar with the market. Qiao Songtao is very painful. Capital is always wavering to them. When Baidu announced that it would be the largest city logistics company, the potential investors of UU errands scared away a large number of people; later, the US group and hungry also said to be the biggest city. The logistics company, investors have scared away a batch.

In addition to the weakness of financing, the support of the local government is quite limited. Although the UU errands and the one-step car in the same city are Internet projects that have been praised by the local government, a local entrepreneur who does not want to be named told the “Financial World” weekly magazine that the government’s encouragement is more in the verbal and spiritual aspects. Did not enjoy too many concessions, the local concern is still real estate and manufacturing.

Today, UU errands have already received investment from institutions such as Oriental Huifu, Qifu Capital and Tianming Capital. The latest round of round of financing reached 200 million yuan. A few days ago, Chen Yuhao also received a WeChat from Beijing investors, hoping to come to Zhengzhou to meet him. He has been busy with products recently and has no energy to finance, but after the media reports, someone has come to the door. Even an investor who often communicates on WeChat has sent him a confidentiality agreement. Although he feels inexplicable, he does not know what he has seen before, and what it means to send a confidentiality agreement.

Since the fight for more and more interesting headlines into the black horse of the venture capital circle, more and more capital has turned its attention to this field. As the beneficiary of this round of capital “going to the countryside”, the story of UU errands is not typical. This is a business model that was abandoned by first-tier cities, and one of the reasons for its success is that the company is doing very heavy. “The operation of the grounding gas under the line is rooted in the local area.”

The third and fourth-tier markets are more like a human society, and circles and rivers and lakes are everywhere. Qiao Songtao unexpectedly found that their products were very high in the order of a community in Zhengzhou. After inquiring, they knew that a mother in the community was a KOL in the circle. After the initiative Amway, the entire community was in use.

The first riders of the UU errands (officially called “running men”) came from the driver of the motorcycle. This is a special group, most people do not have a smartphone, but their time and capacity have not been fully released. These people form a queuing mechanism spontaneously online, first-come first-served, and those who maintain order are often opinion leaders (KOL) in this circle. Qiao Songtao found KOL in the driver of Mo, asked him to eat, let him earn money first, I believe he is not a liar.

Qiao Songtao has a lot of affinity, he experienced the loneliness of this group. As early as 2006 when his daughter was born, Qiao Songtao found himself tossing outside, no house, riding a battery car, and the days were hard. He now asks executives to send at least four orders a month, only to ride a battery car. When he often delivers orders at night, others only open a small slit. After the things are collected, they are followed by a jingle. Some people even look at his ID card first, take a photo and open the door.

This is the beginning of Qiao Songtao’s errands. This offline operation and organizational ability is seen as a barrier to competition. In July of this year, Didi entered the take-away market. Zhengzhou was the fifth city to sell DDT. Many of the small platform’s rider resources, including Dada’s same-city distribution platform, suffered almost heavy losses under the high subsidies of Didi. Qiao Songtao found that they only lost more than 200 days.

“If we go through the money-burning model, we can’t live now.” Qiao Songtao said that compared to Flash, Dada, which rely on strong capital competitors, the UU errands with weak financial strength can only work fine. When the giants transit, the local Internet companies that grow up can still hold back the pressure.

“There are not more companies in the sinking market, not that opportunities don’t exist, but they have been discovered by existing companies and not left to new companies.” The above investors told the “Financial World” magazine.

The stories of the three- and four-line sinking markets are different, but success is never easy. Most of the areas that do not have high-pressure competition have natural defects and hard-to-break barriers.

Tan Siliang, who has a lot of jaundice and funny headlines, is doing business in the sinking market, but they are elites and have a fresh resume. Huang Wei, who graduated from Zhejiang University, has a close relationship with the commercial tycoon Duan Yongping and Ding Lei. Tan Siliang, who graduated from Tsinghua University, worked at Yahoo and Shanda. Later, the advertising company he founded was sold to the listed company at a price of 1.35 billion.

The stories of the three- and four-line sinking markets are different, but success is never easy. Most of the areas that do not have high-pressure competition have natural defects and hard-to-break barriers. The cost of traffic in this market is indeed lower, but it is impossible to easily obtain it by brushing the wall and making a TV commercial. The preference for these people, coupled with the heavy operation of localization, has become the key to gold mining in the sinking market.

More importantly, there is still pressure from the giants here. Not long ago, the fun headlines that started in the sinking market successfully caught the attention of today’s headlines. Today’s headlines are also on the line. The biggest difference with the regular version is that the speed version can see the information red envelope. It is not difficult to see that today’s headlines are not intended to give the fun head a big living space. For most entrepreneurs who have not yet gained the favor of capital, the living space needs to be searched for in the gap between the giants.