Long? The price war has hit both sides very much today;
The third is that Quantum chose large-scale expansion in 2018, resulting in high costs; housing leaks coincided with overnight rain, and caught up with the cold winter of venture capital and the market downturn, and the newly expanded production capacity could not be profitable;
Fourth is that Focus is still a very traditional company, and it faces many obstacles in the face of digital and Internet transformation.
Let’s analyze one by one:
One of the dilemmas: Is there a moat in the audience?
Gao Yi Assets CEO Qiu Guolu once said that the moat that has to be dug every few years is actually not a moat.
Do you want to re-dig the moat of the crowd? Before answering this question, you need to build a business model for Focus Media: It is an elliptical type, one end is a property, the property is scattered, they have no bargaining power for the focus; the other end is the advertiser, the advertiser Although there are also large companies, because the advertising scene is monopolized, they also have no bargaining power; the middle of the ellipse is the focus.
A number of industry insiders said that before 2018, the concentration of advertisers will increase the price of advertisers every year, with an average increase of 10% per year.
So this elliptical model is to press both ends to make the middle bigger, take 20% of the best quality advertising resources to tying 80% of the common resources, and improve the overall ROI. ButThe biggest problem with this model is that the moat needs to be dug frequently. As long as there are new players in this market, on the one hand, the property rent will be raised, and on the other hand, the advertiser will face the low price. crisis.
Interestingly, as a high-margin industry, in theory, it will continue to effectively enter the industry, but the faction has occupied a monopoly position for quite a long time until the new wave emerges. The reason why there is no similar competitor in the past is because the advertising business is special. As the scale of the advertisement increases, the unit cost is rapidly decreasing. Most of the business is increasing with the scale, and the unit cost will still rise. However, it is slower, which requires players with large financial support to compete with the audience. In the past, big money was invested online. When the Internet dividend subsided, their eyes began to stare down.
