Why will Baidu regain recognition at the capital level?

“If you were asked to propose a plan to make Baidu Station listed at a peak value of 100 billion, what would you think of?”

You might as well think for 20 seconds. One of my analyst friends said that they occasionally ask this nonsensical question when interviewing Internet industry analysts.

This is obviously not an easy question, and the answer to this question can reflect the interviewer’s understanding of the entire industry. He said that he often hears many wild and interesting ideas.

In fact, the real business world is many times more complicated than any concise answer given by any interviewer. As business bystanders, we can actually observe carefully from public information. In reality, Baidu, an Internet veteran, is now What real strategies to take to complete the self-advancement.

In fact, due to Baidu’s very strong fundamentals and the recent announcement of a car-building plan, Baidu’s stock price has risen from the lowest point of US$83.62 in the past year The current USD 240.25 has almost tripled.

This range is an extremely beautiful result even if you look at the general rise of the capital market in 2020, which makes the industry have to answer an important question again——

Why will Baidu regain recognition at the capital level? Where is Baidu’s growth potential today? Why did it fail to decline as quickly as observers expected, but instead grow strongly again?

Today we will talk about this topic together–

1. Don’t play the table-can Baidu hold the basic plate

The current Baidu does need to attack, but the premise of the attack is to have a stable rear. Attacking requires capital and confidence. Therefore, for Baidu today, it cannot be overemphasized to stabilize the basics.

So, how is Baidu’s basic disk guard?

According to Statcounter data, in July 2020, Baidu search accounted for 83.34% of the domestic mobile search engine market. On all platforms, including computer, mobile, and tablet computers, Baidu search accounted for 69.52%, Baidu App has over 200 million daily active users, with a peak value of nearly 250 million, and its information flow ranks first in China.

According to QuestMobile’s “2020 China Mobile Internet Autumn Report”, as of September 2020, the number of Baidu App monthly active users has reached 550 million.

It can be said that from an objective data point of view, Baidu still maintained its basic market in the main channel of the user level.

The reason behind this is that search itself has a very high technical threshold. An important aspect of this threshold is the accumulation of data. Every time a user clicks on a result, the search engine will further optimize its search algorithm. In a sense, this is also an important reason why no latecomer has been able to subvert the dominance of Google and Baidu in search for the past 20 years.

Baidu forms a dual engine with information flow on the basis of search, which is also an extension of its own algorithmic capabilities. Google has also switched to the “search” + “information flow” model, which is also in a sense Architecture approval.

In fact, the flow of information seems simple, but there are extremely high requirements for the experience behind it, which is an extreme test of skill. It is different from search. The results of search are relatively easy to measure, but the flow of information is a long stream for users. The process, the difference is extremely subtle, it requires extremely high execution and product iteration capabilities for product experience, content production, and author ecology.

At present, Baidu has developed and defended the important fortress of information flow under the strong pressure of today’s Toutiao ecology and WeChat public account ecology, which will also provide it with other attacks on products and revenue. Enough ammunition.

The user level holds the main channel, so what about the revenue level?

Its public financial report shows that in the third quarter of 2020, Baidu achieved revenue of 28.2 billion yuan, a year-on-year increase of 1% and a month-on-month increase of 8%. The net profit attributable to Baidu reached 13.7 billion yuan, a sharp turnaround in revenue and profit. Both exceeded Wall Street expectations.

Baidu’s core business revenue is 21.4 billion yuan, which is the main driving force for Baidu’s revenue growth. Baidu’s core adjusted EBITDA margin reached 46%, a record high. It should be noted that this was achieved in the context of the overall downturn in the advertising industry after the Chinese economy experienced the test of the epidemic.

In my opinion, this is not only attributable to the improvement of Baidu’s user products and commercial products itself, but also has a certain relationship with Baidu’s deep cultivation of performance advertising. Usually, when the economy is facing uncertainties, advertisers will allocate more carefully With your own budget, ads that better measure ROI will be more popular at this time, emphasized from Baidu’s financial reportThe strong recovery of traditional industries—medical, education, and automobiles—can give you a glimpse of it.

Mobile Internet is gradually moving towards stock competition. When the new industry cycle is about to begin, Baidu can only provide enough motivation for its subsequent moves if it guarantees that it will not play the table.

Second, the product is easy but the ecology is difficult-how the three pillars connect the island to the mainland

The island effect of mobile Internet is a topic that Baidu cannot avoid.

From the perspective of existing actions, Baidu’s strategy is very realistic-“connect islands into continents”. This strategy seems so simple in logic, but it will be very specific when implemented-which ones to connect island? Can the ecology evolve on its own after connecting into a continent? What infrastructure is needed on the mainland? How to deal with the adaptability of new islanders? Such specific issues are actually placed in front of Baidu, an Internet veteran.

The implementation of this strategy of “connecting isolated islands into the mainland” is actually through Baijia account, smart applet, hosting page, the three new infrastructure pillars of Baidu, the content and content that originally needed to be carried by independent apps The service is connected to the big island of Baidu and becomes part of Baidu’s mobile system.

Baijiahao is essentially a content ecological engine of Baidu. Its successful foundation requires the close integration of a series of supporting facilities such as content producers, content incentive mechanisms, content distribution systems, and content commercialization.

Today, Baijiahao’s content ecology is already at a rich and open stage. It not only attracts authoritative media such as People’s Daily, central ministries and key government agencies, but also invests in high-quality content such as Nutshell, Kaishu Storytelling, and Zhihu. The platform widens the boundaries of content.

On the other hand, Baijiahao continues to lean towards high-quality content in multiple dimensions such as traffic, resources, and personal IP creation, driving creators to produce more high-quality content to feed the Baijiahao ecosystem and building a virtuous ecological cycle.

Baidu Smart Mini Program is an endogenous service engine, which can present countless services in a light-weight manner in a complete and native way. These presentations can open up the original walled garden and make services light, simple, Easy to find and easy to use.

The embryonic form of Baidu hosting pages can be traced back to 2018, when Baidu vigorously rectified medical advertisements. Subsequently, the hosting page began to introduce a series of tools for enterprises to connect and accumulate users, and to form different solutions for different industry characteristics such as education and training, life services, and retail. In this regard,Baidu wants to realize ecological ambitions in accelerating the digitalization of small and medium-sized enterprises.

In the PC era, the Internet realizes true interconnection through hyperlinks. In the mobile Internet era, the rules of the game have undergone essential changes. Each APP has become a walled garden with clear boundaries, and the mobile Internet world has become One island after another, Baidu’s determination to fight against “islandization” is gradually manifesting at this time.

3. How long is the strategic radius of “personification” and “servitization”

Looking at the overall strategy of Baidu’s mobile ecology from the product level, the product level includes both Baidu’s core user products, as well as the three pillars and business ecology throughout, as well as vertical categories, traffic ecology and investment that represent future growth potential. How to deal with the relationship between them, how to make them form a unified fighting force?

The person in charge of Baidu’s mobile ecological business group Shen Shao mentioned two keywords-“personalization” and “service-oriented”. The length of the radius of these “two majorizations” also determines the power logic of all Baidu Mobile products.

Undoubtedly, in the PC era, users use Baidu to find information. The provider of information is usually a website. The person who creates information is usually neglected and has a weak sense of existence. Baidu’s personification strategy We are committed to changing this situation, highlighting those who create content, and stepping into the foreground.

In fact, this is actually the result of long-term user selection. Compared with ordinary content, personalized content is more appealing and sticky, and it can also build a deeper relationship with users.

The reason for emphasizing “personalization” is that the essence behind the mobile Internet is people, so Baidu’s mobile ecosystem serves a living person.

“Personalization” refers to human-centric content and services. Baidu is known for its technology, but today it realizes that what it serves in this age of information overload is no longer a cold machine, but a Humanistic care, warm content and service.

“Personalization” is not a slogan, but runs through the construction of Baidu’s mobile ecosystem. For example, Baijiahao will pay more attention to the product level to better connect users and producers behind the content through multiple interactive methods.

At the same time, the importance of people themselves is also increasing, and emphasizing personification can also further increase the credibility and adhesion of Baidu information. Baidu will subsidize 10 billion traffic and 500 million cash in the second half of 2020 and recruit 1,000 high-quality anchors in the fields of food, emotion, education and health empower them to produce “personalized” content.

Another important strategy emphasized by Baidu is “servitization”. What is behind “servitization” is actually Baidu’s insight into the nature of demand.

It must be noted that service capability is a core competitiveness, which includes Baidu’s ability as an Internet product service userStrength also includes Baidu’s ability as a participant in the platform service ecosystem. On the C side, Baidu shortens the user’s browsing path as much as possible, and provides one-stop service through the carrying capacity of mini programs and hosted pages.

Why should we emphasize servitization?

The essence of the Internet is a service. What users ultimately pursue is not the information itself, but the services behind the information. For example, in the era of writing, people “eat eggs, there is no need to know the chicken that laid the eggs.” In the live broadcast era, “users I can directly see how the chicken lays the eggs”, in the process of changing the content from text and pictures to video and live broadcast.

For another example, a user queries Baidu for information about a certain train number. Is it true that it needs this information? Yes, but more importantly, it shows that users are considering train travel. At this time, buying tickets, using cars, and hotels are all potential needs that users really need. Through service, Baidu can use smart applets and hosting pages to undertake With these requirements, the user experience no longer becomes fragmented, but a complete closed loop.

Baidu in the PC era does not constitute a complete closed loop. What it provides is the value of information retrieval, which is only one link in the entire experience value chain. Today, through service-oriented scenarios such as smart applets, it Extending Baidu’s experience value chain, it also keeps commercial value in its own system through servicing.

Public information shows that Baidu’s Smart Mini Programs have introduced 420,000 Mini Programs, with monthly activity exceeding 500 million, and more than 240 smart Mini Programs with monthly activity exceeding one million; in terms of hosted pages, there are currently more than 600,000. Enterprise customers have used hosted pages.

From paying attention to information, to paying attention to the people behind the information, from providing a single product to multi-dimensional services, it can be said that the two core concepts of “personalization” and “service-oriented” are not just a strategic conceptual upgrade. It is also the general trend of the Internet industry.

Four. Deep Cultivation and Depth——How big is the imagination of vertical industries

In addition to the three pillars mentioned above, the construction of a complete picture of Baidu’s mobile ecosystem, in addition to mature platform-level user products such as Baidu APP and Baidu Tieba, Baidu also focuses on various vertical industries-they In a sense, it can be called the peninsula in Baidu’s island-building plan——

Baidu divides its vertical industries into three categories:

The first category is focused and deep-growing. An important feature of industries such as health, education, e-commerce, live broadcasting, and To B is the rapid growth of its own track. The fundamental demand for Baidu to enter these fields is to Its own highly potential business has transformed into a new growth point for Baidu’s own mobile ecosystem.

Take health as an example. It is positioned as the personal health management platform of choice for the Chinese people, providing authoritative and professional sources of health care knowledge and information in the form of text, videos, pictures and Q&A. During the COVID-19 outbreak, Baidu JianKang’s “Ask a Doctor” column has provided more than 61.66 million online medical consultation services, over 850,000 single-day consultations, and provided over 480,000 free consultations to overseas compatriots, becoming the first portal for Chinese online medical consultations.

Another example is e-commerce. Baidu e-commerce not only has its own stores, but also connects with Baidu search and other systems. At the same time, it has invested in ecological companies such as Youzan and Gede Ranking, so as to build a relatively complete system. Serve users with e-commerce needs.

The second category is the moat vertical category, including knowledge modules, cars, and novels. The knowledge modules represented by knowledge, encyclopedia, experience, and library have produced over 1 billion high-quality content, building China’s largest Knowledge content system, the average daily search volume of this module has reached 1.54 billion times, and it serves 230 million users every day. The average daily browsing time of users exceeds 630 million minutes. This module is also Baidu’s product matrix with the deepest brand perception besides search. .

Baidu’s car vertical category is centered on Youjia, and Baidu’s novel module has Qi Mao and Baidu Reading.

This type of vertical industry constitutes the moat of Baidu’s vertical content products in a sense, and can play an enabling role in undertaking search results and its own evolution.

The third category is other vertical categories, including online disk and game businesses.

These verticals are extremely important to Baidu. In addition to increasing the imagination of Baidu’s overall market and expanding the boundaries of Baidu’s mobile ecology, it can also allow its original advantages to generate actual value through empowerment. .

This actual value is not a simple flow of left-handed to right-handed, but to allow these businesses to grow on their own under the sun and rain of the entire system, that is, Baidu needs to increase these verticals, and this increase is based on the overall industry For growth, Baidu needs to get its own dividends based on the bigger pie of the entire market.


In the short history of science and technology business, companies that took off twice are actually very common. Apple and Microsoft once fell and then took off. Weibo and Xiaomi were once looked down upon and then re-emerged. The development law of the technology industry It has been proved countless times-“It is easy to regret products, but it is difficult to regret ecology.” Today’s Internet competition has essentially surpassed competition at the product level, but at the ecological level.

In the PC era, Baidu used to be an ecological empire linking all Chinese websites. However, in the mobile era where they are fighting each other, Baidu needs a storm to open the walls by its own means, build its own fortress and a new continent, Build your own advantage again under the rules of the game.

The new super-entry war is about to start. It is not so much a battle between business and market value, but a battle between users and services. Whoever can provide users with better services and ecology can be here. In a new round of war, we have a greater chance of winning.