In the next few years, who can sit firmly in the position of “teaching a brother”? The development trend of the K12 training business may have a decisive impact.
Editor’s note: This article is from WeChat public account “Tencent deep network” ( ID: qqshenwang), author: Enron, editor: Xiao Kang.
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There was almost a “big brother” to acquire the whole process of mergers and acquisitions, and after becoming a good future, it gradually became the strongest competitor in New Oriental.
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In the next few years, who can sit firmly in the position of “teaching a brother”? The development trend of the K12 training business may have a decisive impact.
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If before 2013, the contest between New Oriental and the good future K12 business is mainly concentrated online, then after 2013, the contest between the two giants began to shift online.
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Education is a slow industry. The Chinese education market is fragmented and scattered. It is difficult to form a “winner-take-all” situation within a few years like the Internet industry.
If you are willing to invest in me, you will always give me some support, some exchanges, and the brand will also help. But it is best not to be 100%. This kind of acquisition is the dream of the team.
A lot of years ago, when learning and thinking was just a fast-growing startup company, Yu Minhong wanted to integrate the whole team into New Oriental, and the founder Zhang Bangxin said so. However, this kind of overall acquisition makes Zhang Bangxin unacceptable. “Even if it is controlled, it is necessary to keep some shares for the team.”
Time shifts to the world. A few years later, I was almost changed into the strongest competitor of New Oriental after being transformed into a good future by the “big brother” and became one of the giants of the Chinese education industry.
On March 28, 2019, New Oriental Online was listed in Hong Kong. According to the prospectus, as of the six months ended November 30, 2018, the operating profit of New Oriental Online changed from a loss of 41.63 million yuan to a profit of 41.44 million yuan, and the adjusted profit was 31.43 million yuan, a year-on-year decrease of 60%. According to this situation, the development of New Oriental Online does not seem to be very smooth. For losses, the prospectus gives explanations mainly due to increased sales and marketing expenses, especially K12 and pre-school investment and expansion.
A good future sees the importance of online K12 education earlier than New Oriental. From 2011 to 2012, Zhang Bangxin served as the general manager of the school and thought on the network school. “You are doing offline, I am going to do internet education, and after a few years, I am waiting for you there,” Zhang Bangxin said in the future.
From 2010 to 2017, Xuesisi Network School has tried various product modes such as recording and broadcasting mode, “recording and broadcasting + live broadcasting” mode, live broadcast mode, double teacher classroom, small class live broadcast + personalized counseling. In 2018, the school was completely transformed into an online live broadcast platform.
In FY 2019, Q4, the school’s single-quarter revenue increased by 204% year-on-year, and the number of registered students increased by 146%. Throughout FY 2019, Learn to Network School contributed nearly 17% of income and 39% of registered students.
In the face of learning and thinking, the business of the school has grown by leaps and bounds. Some insiders have revealed to Shennet. “New Oriental Online has established a comprehensive strategy for benchmarking and thinking.” In this regard, Zhang Bangxin is relatively calm, “I think all the models I have seen, all the visible opponents, are not real opponents, just like Nokia stared at Motorola every day, Kodak stared at Fuji, and finally they were defeated by others. So the real danger is those you can’t see.”
To B Battlefield
For head education institutions, policy adjustments and shifts may require more attention than competitors who can feel it every day.
On February 22, 2018, the Notice of the Ministry of Education, the Ministry of Civil Affairs, the Ministry of Human Resources and Social Security, and the General Office of the State Administration for Industry and Commerce jointly issued the “Notice on Effectively Reducing the Extracurricular Burden of Primary and Secondary School Students to Carry out Special Governance Actions for Off-Campus Training Institutions” was opened in 2018. K12 teaches the prelude of market rectification. In November, the Ministry of Education and other three departments issued a notice again, for the first time, it is clear that the online education and training institutions will be standardized in accordance with the management policies of offline training institutions.
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