Works of Tiger Sniffing Mobile Information Group
Author | Huang Qingchun
title map | Visual China
If you have ever tried to understand the consumption habits of contemporary young people, membership economy is definitely a topic that cannot be avoided.
Six years ago, Robbie Kelman Baxter, the founder of Peninsula Strategies in the United States, published a book titled “The Membership Economy” (“Membership Economy”)‘s books, and is therefore praised by the industry as the pioneer of the concept of “membership economy”.
But before that, Costco had explored a successful membership economic model in the US market as early as the 1970s. And giants such as Amazon, Netflix, and Apple are undoubtedly the masters who have carried forward this “pricing system” in the Internet wave, and even promoted it as a commercial trend that has swept the Internet.
Behind this is the rise of the consumption power of the younger generation. Their consumption concepts, preferences and methods have reshaped the trends and patterns of consumption behavior. For example, buying members is becoming a consumption habit of young people. They pay for their interests, pay attention to personalized services, and even regard paid services as a way of life.
But before the membership economy landed in all walks of life in China, the consumption perception and consumption habits of the previous generation were not the same. The membership economy of domestic Internet companies has undergone tremendous changes compared with ten years ago.
The following content is compiled from a dialogue between iQiyi member and president of overseas business group Yang Xianghua and Huxi:
The membership economy is a new business model, at least before.
Before 2010, there will beThere are very few commercial formats of the employee economy in China. Although domestic airlines and hotels are already learning the lifelong plans of foreign airlines and hotels, strictly speaking, there are very few Internet companies studying the paid subscription model.
At that time, there was no subscription service for pay TV stations in China, and there was also a paid subscription service for media in China. All content was free on the Internet, and everyone did not know how to commercialize high-quality traffic.
Before and after 2010, when iQiyi tried a new business model, it conducted a survey on “post-70s” and “post-80s”. The question was “will you pay for video content?” Thirty percent said they would consider it. Some of them said I would like to, and some said it depends on the situation. The remaining 70% were determined and would never consider it.
This is not surprising. You must know that although the “post-70s” and “post-80s” generations live in the Internet age, they are limited by the limitations of the times. Saving money is always the first place.
So, they are willing to spend time in exchange for money, and would rather spend two or three hours looking for pirated copies, and then spend another hour or two to download the pirated content, rather than paying for a few dollars. In addition, most of the content on the Internet at that time was free. Even if you were willing to pay for the service, most of them were buying and selling pirated DVDs and CDs. This was also based on the fact that pirated copies were cheaper than genuine ones.
About 2016, when Yang Xianghua, president of iQIYI member and overseas business, was on a business trip to Taiwan, he happened to see “Membership Economy” in a Taiwanese magazine, and found that it did not have a Chinese version, so he bought it. An English version.
One year later, a traditional Chinese version of “Membership Economy” was published in Taiwan. It was typeset vertically, which looked particularly laborious, and the words used were different from the original work. Therefore, Yang Xianghua asked a translator to translate the English version of “Membership Economy” for internal member-related colleagues. This book soon became a must-read for iQiyi’s member department.
The book “Membership Economy” introduces in detail the different modes of membership system, such as lifetime system, subscription system, etc. However, the case and experience of companies outside of China are not fully adapted in China. What domestic companies have to do is to On this basis, we continue to explore and try to find a set of payment models that are in line with Chinese consumers.
In hindsight, it had a profound impact on iQiyi’s development of the membership economy.
In the new era, free and no paid incense
If 201The survey in year 0 is placed now, and the situation may be completely different.
The “post-90s” generation lives in a relatively affluent era. Their parents are the first and second wave of successful entrepreneurship under the Internet wave. With abundant material conditions, they are naturally willing to spend five or ten dollars. Buy a service instead of spending two or three hours on the Internet looking for resources like parents did, and then waiting for a long time to download.
“After all, they can do a lot of other things for them in two or three hours, and they can have a lot of entertainment. Behind this is the upgrade of consumption concept, and the first wave of users of our membership system happens to be aimed at users born in the 90s. .”
As for the “post-00s” generation, they have lived in the age of membership economy since their birth. They have long been accustomed to chasing variety shows and watching animations through members, and they have a strong willingness to pay for content.
So, looking back at the development of the past ten years, the membership economy has changed people’s consumption habits which is subversive, and this change in payment habits is continuing to affect the consumption concepts of consumers in the entire Chinese market.
So, what is the core of membership?
The first point is to convince users to pay.
Foreign companies have explored for so many years, they are all paid business models operating in a mature payment environment. For example, Netflix’s success is largely due to the fact that Americans have developed the habit of paying subscriptions when watching HBO and Showtime. Netflix is simply transferring users and products that have previously paid habit to online; on the other hand, Netflix prices are cheaper than other platforms.
So, Netflix is not creating a market, but completing a migration of consumption patterns.
Domestic companies want to run through the membership business model, they must first change the consumer’s consumption habits-from the initial free to gradually become willing to pay for some services, and then build their own membership economic ecology.
Among them, a very important indicator is the satisfaction of paying users with content and services. Only the platform canIf you can continue to produce high-quality content, users will be willing to pay for your services.
Facts have also proved that when iQiyi produces high-quality dramas, users’ willingness to pay is very strong. This is the underlying logic that iQiyi has been optimizing and deepening the satisfaction of members in the past few years.
The second point is to focus on core requirements.
The era has enriched people’s entertainment, but it has also made consumers more and more critical-it is not easy to satisfy most people nowadays, because their consumer needs have become more and more diversified 化.
Therefore, the platform must build a membership system around the core functional requirements of the service/product.
For example, what are the core requirements of e-commerce? After all, it is to allow consumers to buy good things cheaper.
Membership rights of e-commerce platforms should focus on these two points, namely, to ensure that the products on the platform are cheap and good-quality. The remaining other privileges, sales methods, and marketing methods are all explicit means to better serve members on this basis.
The emerging subscription-based business model with education as the core and niche is very expensive, but because it is professional and vertical enough, parents have a strong willingness to pay, which verifies the strong market demand for this business model-this It is inseparable from the education of consumers’ consumption habits in the Chinese market. Many pioneers are willing to continue to invest in helping consumers develop the consumption habits of paying for good content or good services.
Back to the video platform, on the surface, everyone is paying for iQiyi members, but in fact they are paying for the content, programs, and services behind it.
For example, members can see content earlier than others, members can skip ads and watch content directly, members can have permission to watch more exclusive/high-quality content, and even experience better sound effects, picture quality, etc. It is a function that meets the diversified needs of content services and builds closely around the core needs of users.
Currently, the quality of dramas and variety shows on video websites is generally optimized and improved, so the budget is bound to increase, even tenfold or one hundredfold. Consumers are actually aware of this growth. The cost and quality of film and television series production in the past ten years must be somewhat different from that of the current series, but you can’t tell consumers that the quality of the production of the series invested now is better than before. So you have to pay more.
At the same time, you will find that iQiyi has been innovating on film and television series of the same type and theme, and has been exploring new possibilities.
For example, “Mist Theater” and some suspenseful skits similar to American dramas.There is no successful production experience, but after trying iQiyi, I found that the brain-burning suspense drama has a large number of loyal fans in China, but it has been ignored for a long time before.
Therefore, the platform can only persuade consumers to pay for the increased price of membership services through continuous innovation, continuous improvement of production quality, and beyond-expected content and services. This is a huge challenge.
Iqiyi used to be a core member of movies for a while, and later added dramas, and later added variety shows, animation, etc., which is to continuously increase investment in original content, continuously strengthen production quality, and continue to present high-quality content To paying members.
This differentiated experience has helped iQiyi consolidate the growth of the membership economy, but it has put forward higher requirements for the platform to adapt to the viewing habits and aesthetics of young people.
Where will the next wave of growth come from?
It is undeniable that streaming media platforms are generally facing growth dilemmas and content homogeneity.
First of all, the dilemma of user growth. In fact, the domestic video platform has gone from a barrenness ten years ago to over 200 million members today. The demographic dividend has basically peaked. After all, if the sharing relationship of more than 200 million members is extended to families, China More than half of the population are video member consumers.
So, with such a high penetration rate of video site members, where will the next wave of growth come from?
First, the dependence lies in the habit of more people using online video fees, which may require a period of change for older people; second, it can only continuously improve the quality of content production and enrich the content supply Types of. For example, there is still room for growth in the more segmented supply of content dramas. In addition to satisfying the tastes of young people, it must also take into account the consumption needs of different age groups.
Based on this, the next room for growth comes from the deep water area. Although it is difficult to change the spending habits of parents, it is worth exploring.
As for the profit dilemma, IQiyi’s anxiety can be seen by how much member prices increase.
However, iQiyi did not adjust the price to the same 100/month as Netflix. The fluctuation of the price is an objective adjustment made with the improvement of consumption level and the improvement of service quality.
Yang Xianghua frankly and did some research on the voices of criticism. “Users’ comments on price increases are generally positive, and most consumers can accept it because iQiyi’s products, services, and production quality are constantly improving. Optimization, true fragrance users will not send true fragrance on the Internet, so the final criticism was noticed instead.”
For example, in order to cater for users with different consumption abilities, iQiyi not only launched Star Diamonds with relatively high prices but richer rights and interests, but also developed products with less expensive rights and less coverage. The logic behind this is Make differentiation-different levels of privileges correspond to different prices to serve people with different consumption abilities. As long as differentiation can be made, and services at different prices can make everyone feel value for money, this is a benign ecology.
Secondly, the homogeneity of content will make excellent works stand out.
If you can be the first to discover the new blue ocean, you can enjoy the initial bonus of this market. When others follow up later, you can discover the next new category, but you will never be able to prevent others from imitating and Competition, as long as consumer demand exists for a successful category, the supply will always increase, and finally enter the Red Sea competition.
Comparing iQiyi with other streaming media platforms, the exploration and attempts of self-produced dramas have been relatively successful.
On the one hand, the platform continues to support and explore young creators(including directors, screenwriters, producers, actors, etc.), innovative types Only the subject matter can emerge; secondly, the quality of the work is guaranteed.
Because of this, the chances of breaking out will be higher, and consumers will be able to obtain more than expected services.Affair.