Gather high-density interest groups to enter niche markets, superimpose community functions and operating methods to establish values, seek diversification of scenarios on a circle-level basis, and finally achieve expansion outside the boundary with the two-way support of external markets and internal products.
Has the “ship tickets” for China’s mobile Internet market been issued?
It looks like it is. According to the report data released by QuestMobile in January this year, China’s mobile Internet traffic entering the era of inventory is being divided by a few giants such as BATT. The five giants, including BATT and Kuaishou, scored more than three-quarters of the user’s usage time in their apps, showing a strong Matthew effect.
On the one hand, these giants that entered the mobile Internet earlier have a first-mover advantage and enjoyed considerable traffic dividends at the beginning; on the other hand, they do provide users with a wide range of high-quality products and services, which also promotes Its position in social, shopping, entertainment, search and other popular scenes is getting stronger and stronger.
When the major giants have satisfied users’ most basic online needs, will other companies have no chance to rise? The answer is obviously no. In fact, a large number of new economy companies are breaking the inertial thinking of “no grass grows under the big trees” in recent years. They have pioneered their own ways and ushered in the opportunity of a collective explosion. This trick is to anchor more precise, deep and specific niche scenarios, while constantly seeking opportunities to expand market boundaries.
Although the giants can split most of the traffic, they cannot fully cover all scenarios. For example, two-dimensional, knowledge payment, health management and other scenarios with broad prospects but high operating thresholds are the directions they were not willing to take the initiative and high-intensity attack, and this has also become the rapid rise of those keen new economic companies. Breach.
From Station B, Zhihu, Xiaohongshu to Keep, observing this group of new economy companies that are gaining momentum, it is easy to discover the common characteristics they have-that is, grasping the “niche market” The development trend of “expansion” first solves the problem of survival, and then seeks more room for development through the expansion of boundaries.
Niche market spawns new economy companies
It is impossible for giants to cover all markets. This assumption is the prerequisite for the emergence of niche markets. Due to the small scale of some scenarios and high operating costs, giants often think that the cost-effectiveness is limited due to the consideration of marginal benefits, and thus intentionally or unintentionally abandon coverage, which constitutes a niche market.
The so-called niche market refers to the market space occupied by a small group of customers with similar interests or needs. The judgment of this “small group” is different. For example, it may be a “small group” for giants, but it is a promising prospect for independent companies that linger outside the giants.Blue ocean.
Based on the niche market to seek expansion opportunities is the choice of most successful companies in the early stage of their business. They are unable to go shirtless on the main battlefield of the giants, so it is inevitable to seek scattered opportunities in the surrounding area. Of course, the niche market also has many characteristics: it often exists in a larger and fast-growing market, has the potential for sustainable development, is small in scale, but is very different from other markets, and so on. These characteristics help start-up companies to build a moat, and ultimately lead to the creation of many “small and beautiful” companies in these fields.
Take Station B as an example. It was founded in June 2009 and was initially only acquainted with people through the ACG (animation, manga, and game) community. At that time, the two-dimensional culture that originated in Japan was far from being widely accepted in China. ACG and the iconic barrage culture were only social currencies for a small number of domestic users, and most people used station B as a tool for curiosity. However, the follow-up rapid development trajectory of station B is widely known. According to its financial report data, the average monthly active user scale of station B has reached the level of about 200 million, which has doubled in just four years.
Similar situations are also present in other new economy companies such as Zhihu and Xiaohongshu. Zhihu was launched in January 2011, and used the invitation system to create a high-quality knowledge sharing community in the early days. Under the background of strictly restricting the source of users, it was welcomed by subdivided groups such as high education, high income, high taste, etc., so that it achieved rapid growth in the various communities at that time with clear differentiation; established in June 2013 The same is true for Xiaohongshu. It was first known for its role as a cross-border shopping sharing community. The niche market targeted at the early stage of development was a small number of consumers who had a need for cross-border shopping and had a higher unit price.
Station B, Zhihu, and Xiaohongshu originated from niche markets such as ACG culture, knowledge groups, and cross-border e-commerce. It is not difficult to get a glimpse of the law of the rise of new economic companies. However, a stable niche market is only the starting point. If you stick to a single circle, its development space will inevitably be limited by the size of the market; therefore, after the initial period of the new economy companies will basically appear through the “niche market expansion” The impulse to seek greater development opportunities.
For example, Station B has successfully entered the long video market with the Dongfeng of the two-dimensional element and barrage culture. By continuously expanding the supply of video content, it has a huge influence among the youth of the Z generation and continues to expand the length of user use. After establishing a niche market and ensuring a high level of user loyalty, Station B began to expand its territory, and this process has also begun to receive response from the capital market. Its stock price has risen from US$20.19 to US$156.37 in the past year. Achieved a nearly 7-fold increase.
Similar to the B station seeking to expand the niche market, Zhihu and Xiaohongshu have also recently begun to try to expand their business possibilities based on the niche market. For example, Zhihu is no longer just a knowledge sharing community, and the audience it faces is no longer just the traditional “three high” people. It has transformed into an original platform covering, aggregating and distributing diversified content; and Xiaohongshu also It is not just a cross-border e-commerce platform, it has become a more influential consumer shopping guide and lifestyle platform in the Internet ecology, and the market boundary has been very different from the initial stage of development.
From the development trajectories of these typical new economy companies, it can be concluded that the niche market is the origin of entrepreneurship, and the expansion of the niche market after a firm foothold has become the lifeline of the company’s subsequent development.
Health management, a new case of niche market expansion
The expansion of some niche markets is mature, but some are just beginning. For example, the health management track is a representative of the latter.
To some extent, whether or not to discover a potential niche market is related to entrepreneurs’ sense of smell. They need to be the first to deploy before most people find a niche market, and what they eat is the dividends brought about by the “time difference”. ; But the timing of judging the expansion of the niche market is different. It not only tests the bravery and cleverness of entrepreneurs, but is also closely related to their decision-making power and maturity.
The success of the expansion of the niche market is related to two points:
First, the development trend of market demand. When observing new economy companies, it is often found that the scale of the population they serve will suddenly enlarge at a certain node. For example, the barrage culture of station B was only accepted by a small number of users in the early days, but now it has become the standard of all long video websites. Match. This kind of opportunity brought by the expansion of market demand provides soil for the expansion of niche markets;
Secondly, the improvement ideas of own products. As the expansion of the niche market means that new economy companies need to step out of the “comfort zone”, if they want to meet the booming market demand, the company will inevitably need to make adjustments in product architecture, operational thinking, and commercial realization. After completing the “from 0 to 1” leap, the expansion of the “from 1 to 100” scale has become another life and death barrier that companies need to cross. This uncomfortable node also happens to put them under huge public opinion pressure.
At present, health management has just reached the window of opportunity for the expansion of the niche market. According to ChuAccording to data from the “2020 China Fitness Industry Report” released by the direct industry media GYMSQUARE, in addition to first-tier cities such as Beijing, Shanghai and Guangzhou, the awareness of fitness consumption in new first- and second-tier cities will also rise in 2020, and the per capita gym consumption amount of fitness consumers has reached 1,000- 3000 yuan, the average consumption frequency of going to the gym 2-3 times a week. Based on the above trends, Refining even calls 2020 the “first year of China’s fitness consumption.”
As a leading company in the online fitness consumption track, the significant increase in market demand has allowed Keep to stand on the window of opportunity for expansion of the niche market. As a fitness platform officially launched in 2015, Keep has gathered a large number of people with high concentration of interest in the past six years of development. In 2018, it has more than 140 million fitness interested users. This data Under the 2020 epidemic, the 300 million mark has been crossed.
By continuing to improve services in specific segmented scenarios, Keep’s advantage in gathering high-density interest groups in the fitness field has become increasingly apparent, and this happens to be the usual idea for companies to successfully establish a foothold in the niche market. Due to the gathering of a large number of interested people and the social relationships established between them have pushed up the viscosity of the circle, this has established a moat for Keep, and it has also become the darling of capital since it received its first angel investment at the end of 2014-Story The latest development is that it just completed the F round of financing two months ago.
But the moat alone is not enough. To seek greater development, you need to break through the limitations of the original circle. This can be seen from the development trajectory of Keep: Initially, Keep provided convenient and easy-to-use sports tools suitable for family scenes. , The rich, professional and systematic course content has delineated a large number of young and upward core users for it; then, Keep began to seek community-based development, through the establishment and improvement of social functions to become a domestic head fitness community, through the same good The exchanges to improve user stickiness; then, Keep began to seek scenario expansion around the original niche market, including providing paid membership services with customized smart training plans, launching various fitness equipment and equipment, expanding offline scenarios through Keepland, and so on.
It is worth noting that Keep is now beginning to extend its tentacles from the C-end of the service to the B-end, and introduce more content entrepreneurs and industry practitioners through the development of platform. The introduction of external forces allows Keep users to enjoy more coursesAnd services, to improve the service experience under the premise of controlling costs, and at the same time allow more people to obtain growth dividends from the booming online fitness traffic pool, and the final result is likely to point to the completion of an online fitness system ecology.
From the development of Keep and other new economy companies, a clear evolutionary trajectory can probably be drawn: by aggregating high-density interest groups to enter a niche market, superimposing community functions and corresponding operating methods to establish a lasting and stable Values, seek the diversification of the scene on the basis of a solid circle, and finally realize the expansion of the boundary under the two-way support of the external market and internal products.
Of course, this process also relies on opportunity. Take Keep as an example. Professional content, product and service resources, and the overall community’s positive, healthy, and upward tone are the prerequisites for the smooth advancement of “niche market expansion”.
Opportunities and risks of breaking through the comfort zone
New economy companies promote the expansion of niche markets because the original circle can no longer meet their development needs. Breaking through the ceiling and finding a way out has become a natural choice. But as mentioned earlier, the expansion of niche markets is essentially a breakthrough in the original comfort zone. The inevitable “discomfort” will bring both opportunities and risks to enterprises.
According to observations, it is not difficult to find that the expansion of niche markets generally has two modes: digging deeper into the value of aggregated people, and expanding the scope of coverage of users. In short, it is either qualitative or quantitative to seek breakthroughs.
Take Keep as an example. In addition to online courses, it also offers more value-added services such as paid memberships, as well as consumer goods e-commerce businesses covering fitness equipment and equipment, healthy and light food, etc. This is to maximize It releases user value to a certain extent, improves the customer unit price level and the efficiency of traffic realization; but at the same time, its exploration of offline and home large-screen scenes also helps to cover more users. For example, the simple dance-related courses it provides can attract less Few middle-aged healthy people.
But it is worth noting that, looking at the development of almost all new economy companies, most of them will experience risks and even cause controversy in the early stages of the expansion of niche markets. The fundamental reason is that some users in the circle cannot accept the cultural shock brought about by the expansion of the niche market; of course, there may also be concerns from users in the core circle about the decline in the quality of service experience after the market has expanded.
Although “small and beautiful” is good, it does not guarantee the continued survival of new economy companies. After all, the Internet jungle never favors the weak. Therefore, new economy companies have to expand their boundaries. In fact, many new economy companies have more or less questioned whether they have forgotten their original intentions when they first tried to expand the scope of users, provide diversified content, and seek expansion of scenarios.
However, when people look back after adjusting to a period of time, they will always find that the various problems that they seemed to be facing at the time, such as user churn, commercialization dilemmas, etc., were ultimately driven by the expansion of the niche market Give myself back more room for development.
The optimistic expectations given by capital are not surprising. “Small but beautiful” is a reputation that can bring glory, but sometimes it is also a shackle of development. The “first-class tickets” in the mobile Internet era may have been issued, but this does not mean that other companies cannot board the ship. On the contrary, in recent years, we have seen more and more new economy companies board the ship, and then began to search for new continents and bravely pioneer.