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2019 is almost over. For the Internet industry, this is another year of rapid change and endless change; every year for the past ten years. It is believed that major Internet companies have already seriously considered the strategies and tactics of 2020, and investors are also considering how to plan for the next year. If you want to find a key word for the upcoming 2020, it is “uneasy”-the experience of the past ten years is becoming more and more unreliable, everyone more and more needs to learn, so many new things, and the macro situation is changing so fast And the industry base is getting bigger and bigger.

Here are 12 questions that the Strange Band hopes to pose to the Internet industry in 2020. I can’t blame the prophet, just the learner. For the following 12 important questions, I have tried to give some preliminary answers through the information I have and the logic I think are feasible. However, in the future, after all, one step at a time, my answer must have many errors; moreover, there must be some important issues that I did not realize. If the questions raised by this strange thief can bring some reference to the industry, then you are satisfied.

Since the rise of mobile Internet in 2010-11 (marked by the birth of Weibo, WeChat, and Xiaomi mobile phones), China’s Internet industry has experienced a complete generation. The Internet giants that are calling for the wind and rain are either rising in the mobile era or part of the PC era giants that have followed the mobile trend. In the foreseeable future, we will still be in the era of mobile Internet, but the competition is becoming more and more intense, and the value of existing experience is getting lower and lower. We need to stay away from the comfort zone and try to open up new paths in the deserted land. This is the main purpose of this article written by this strange thief-throwing bricks and attracting jade, the Internet industry should need to throw bricks.

(The battle plan was made by the commander and staff, but was made by frontline soldiers)

1. Overall pattern

Since 2016, the Internet industry has been shouting “traffic dividends are exhausted”; however, in 2017-19, China ’s mobile device users still increased by more than 200 million, and the average daily user length also increased by 30-45 minutes. In other words, the past three years have been the “end of the mobile traffic bonus.” At present, China has 1.1 billion smartphone users, and the average daily screen time is about 4.5 hours; both are approaching the “theoretical upper limit”.

It can be said that, until today, the Internet giants have not yet entered the era of so-called “stock games” and “attacking each other’s bases”. To give a very simple example: when the vibrato rose unstoppably, the growth of the fast hand did not stagnate; the claim that the vibrato took the length of WeChat users was also unfounded (the user duration of the vibrato and fast hands was actually created by themselves of). By operating market segments, layering users, and occupying the remaining empty space, Internet giants in the same industry may still achieve coexistence: Think about it. In 2019, the performance of Ali, JD.com and Pinduoduo is very good.

However, the above scene should be called “quietness before the storm”. At the latest in the first half of 2020, most of the remaining “blank land” will be opened up; the monetization of old users will encounter bottlenecks; the sluggish real economy will continue to affect the Internet. Therefore, we will eventually enter the era of “stock games” or “giants hurt each other.” Will this era be far more cruel than before? Will competition logic and growth logic be completely different? In the end, will everyone stand in line and form a few more tight groups? In any case, the future will not be better than the past …

(War will become more and more cruel. Be careful not to fall in love with it.)

2. Problems with the formation of the Internet

Investors generally believe that there are several “camps” in China’s Internet industry, just like the Allies / Axis countries in World War II: Tencent, Ali, Baidu, and the rising Toutiao, Ruo The absence of Lei Jun, and so on. However, the above view is wrong. It can be said that until 2019, the phenomenon of “stations” and “system building” in the Internet industry is still in its infancy, far from being a camp.

First, “Tencent Department” does not exist. When Tencent makes strategic investments in startup companies, it often does not even agree to prohibit Ali or byte beating investment; Tencent rarely participates in the management of strategic investment objects, which is often criticized. Second, “”Ali system” does not exist, because in recent years, Ali has become more and more inclined to collect important investment objects into the consolidation system-Cainiao Network, Are You Hungry, and Word of mouth? This is the case. In the end, the “Baidu Department” and “Headline Department” actually do not exist. Their most powerful subsidiaries or sub-applications are actually within the scope of consolidation.

In 2020, the “station team” may be more important because the competitive environment has deteriorated and the financing environment is not optimistic. The Internet may really be in a situation where “three / four camps stand side by side”, and the traffic and content of each camp are relatively closed. Tencent, Ali and ByteDance may be more concerned about the day-to-day management of investment objects, and emerging companies (if they still exist) will increasingly welcome their involvement. Will this be the “new normal”? Is this new world not beautiful at all?

(Will the Internet world be fiddled with by several giants?)

3. The natural contradiction between user concentration and layering

In the late stage of the development of the mobile Internet, there is a natural contradiction in the traffic pattern: on the one hand, users are becoming more lazy and unwilling to install many apps, and they prefer the “one-stop service”, with traffic concentrated on a small Head platform (stronger Hengqiang); on the other hand, user experience is getting richer and more autonomous, and more and more attention is paid to illusory things such as “tonality” and “vertical features” (layering, classification). There are business opportunities in both aspects of the contradiction. The problem is that you can hardly have both.

In the past few years, we have witnessed the rapid development of short video apps such as Douyin and Kuaishou into “all-around platforms”, entering live shows, live games, and e-commerce with goods. The resulting “dimensional reduction blow”; we have also seen that vertical platforms such as Station B and Xiaohongshu have steadily expanded their user base and realized monetization. This is the result of the “vertical tone”. In the game industry, the above-mentioned “schizophrenic” trend is even more obvious: on the one hand, national categories such as “eating chicken” have swept the country almost overnight; Fascinating.

In the process of “schizophrenia” mentioned above, the most painful are those platforms or content that “can’t be high or low”: neither has the ability to do super platforms, nationwide content, and has no characteristics or tone to attract vertical fans . Especially in the fields of video and e-commerce, “medium player” is almost synonymous with “decline”. In 2020,Will we see the polarization of the entire Internet industry? In the future, will it be a few head platforms plus a large group of featured applications / content providers? I would love to see it!

(Always remember: people who are proud at the beginning may not laugh to the end)

4. 2B Internet that will never come?

In the past two decades, successful Chinese Internet companies have been doing 2C business. Strictly speaking, the vast majority of Internet companies in the world do 2C business; in the United States, 2B software / IT solutions companies and 2C Internet companies are also two circles (Amazon may be an exception). Since 2018, for various reasons, Chinese Internet companies and investors have increasingly emphasized the importance of 2B business. Unfortunately, even by 2020, it will be difficult for us to see that the 2B business will contribute substantial profits to any Internet company.

2B and 2C are completely different businesses. The latter pays attention to the effects of scale, holding high, playing fast, iterating fast, and funnel theory. The former is almost the opposite of it. Internet companies are actually more suitable for B2B2C, such as helping banks with loans, and providing C2B experience for traditional corporate customers. The most important thing is: what’s the point of winning the 2B market? How big can China’s largest 2B software company be? If not the traditional 2C business is approaching the bottleneck, which Internet giant will heavily invest in 2B?

For Internet giants, even if the traffic dividend is completely exhausted, 2B is not the only strategic direction. The following directions are at least equally attractive: overseas expansion; integration of upstream content; smart home (IoT); further enhancement of data monetization. Of course, for external investors, the “trillion-scale 2B solution market” sounds sexy; the question is, can Internet companies eat it? Can they make a profit even if they do? I am not optimistic about this Attitude.

(Some battles you ca n’t win,But still have to fight a dozen)

5. Multiple problems of overseas expansion

People once thought naively: With the successful experience and fighting power of more than one billion users in the Chinese market, it will be a smooth journey for Chinese Internet companies to go to sea, and the Internet will be the first choice for China’s “output business model.” TikTok’s success seems to validate this view. However, by the second half of 2019, we see that things are not so good. In a nutshell: entering developed countries will become increasingly difficult, and entering developing countries will not be profitable.

The hostile attitude of American politicians to TikTok can explain a lot of problems: They think that it is dangerous for a Chinese company to collect the privacy data of American citizens. In Europe, many Chinese companies have suffered losses in user privacy. For user privacy, European and American regulators can even issue sky-high price tickets to their own companies, let alone Chinese companies? In addition, North American Internet giants such as Facebook and Google are far from being as incompetent as many Chinese think-they do not work overtime, but they are not efficient in responding to challenges.

In 2020, the strategic direction of China ’s Internet going to the sea will probably point to the developing countries—the traditional strengths of Southeast Asia, the rising South Asia, the Middle East with a lot of money, and the emerging Latin America and Eastern Europe. The problem is that most of the above are either low- and middle-income markets, or the cultural background is very different from China. In the field of content such as games, the difficulty of going to sea may be slightly lower; at the platform level, going to sea will still be difficult. Will the Internet giants adopt a more pragmatic and conservative attitude toward overseas expansion? Or take advantage of the money to speed up expansion and try your luck? Different companies will make different choices.

(War in others’ territory is a reward)

6. “Privatization” of traffic and “personalization” of brands

At the end of 2019, no one knows Li Jiaqi and Wei Ya’s names. In fact, they have long been the lively figures of Taobao live broadcast, but they have only recently moved to a larger world. Users like Li Jiaqi very much, his conversion rate is very high; the brand is also looking forward to Li Jiaqi, Estee Lauder and other head brands will sell the first sharp goods to him at the lowest price on the entire network. At the same time, we see that traditional brand advertising is declining; Li Xiang and other “stars” try to bring in goods very poorly; traditional video platforms and brokerage companies have not yet copied their own Li Jiaqi / Via. How is this going?

In a nutshell: We are in an era of “brand personalization”. Users are no longer interested in traditional fake big air propaganda and high-powered settings. They want to see influencers / contents / brands who can breathe, be grounded, be toned and professional. People often ask me “what is tonality”, and I will answer: you will never mistake Li Jiaqi for passers-by, Guo Degang for Jiang Kun, and Quentin for Guo Jingming. This is tonality! This is the basic reason why Weibo is fading and fast-handed, and long video is fading and vibrato is popular: Are you more willing to look at cosmetic face data, poor acting skills, and operate the data set set by fake people, or do you want to see real temperament and hipster Fan, grounded UP mastermind renju? Don’t get me wrong, I know that many UP anchor / anchor staffing is also operated, but it is still more credible.

The “personalization” and “tonalization” of communication methods must accompany the “privatization” of traffic. Station B has one fan on top of Weibo and ten fans. The value of WeChat group is far more than that of WeChat group-because the former is more “private”. Traditional media, traditional advertising platforms, traditional traffic distribution mechanisms, and traditional content ecology are constantly being suspended. All in all, the closed loop of fans is constantly shortening, and fans are paying more and more attention to “content itself” and “creator itself” rather than the system behind it. Is this good or bad for the Internet industry? All I know is that this is a big change and someone must benefit.

(Any time you reshuffle, there are a few happy and a few sad)

7. Aboriginal people of mobile Internet have grown up, they are smarter than you

In 2020, the first batch of post-90s will reach 30 years old, and the first batch of post-00s will reach 20 years old. Aboriginal people of the mobile Internet after 95-10. For them, the mobile Internet is “of course existed”; just as for the post-80s, TVs, cars, and refrigerators “of course existed.” They are very smart, smarter than you and me. They are flying and playing with virtual social networks. They often have good payment habits. Most of them are happier than their parents and are good at doubting authority and deconstructing everything.

I found that most people in the post-70s-80s did not understand the growth environment after 95-10s and underestimated their acceptance of new things. For example: I recommended the Gate of Destiny to a post-80s executive, and after reading two episodes, he said that he could n’t understand, “Such a complicated thing cannot be popular”; he thinks that young people should be more Like the “simple and rude content” of the Tang family. The fact is that none of the post-95 generations I know are fans of the Tang family (he belongs to the previous generation), and everyone can understand the complex “time machine” and “world line convergence” theory of “Gate of Destiny”. why? Because that’s how they grew up!

Since the post-95s are so smart, why do many people still feel that they are “lazy, degenerate, and unable to suffer?” Because there is no need! They know that “the world is not worth it”. The 996 theory is nothing more than a fattening capitalist. In the final analysis, everything is done for personal development and happiness. They are steadily taking over the Internet-from the right to speak, the length of their users, to the revenue contribution. Many investors think they understand them, but they don’t. Can Internet companies learn to please 95-10 as soon as possible, break stereotypes, and mingle with them? I’m not too optimistic; this is bound to be a long road.

(If you do n’t learn, you will be defeated, if you lose, you will be captured)

8. E-commerce industry: after the magic of 2019

For the e-commerce industry, 2019 is quite magical: the macro economy is clearly decelerating, the growth rates of several major e-commerce platforms are still good, and the double eleven also reported a new high. However, the performance logic of Ali, Jingdong, and Pinduoduo is different-Ali is enjoying the “Amoy e-commerce ecosystem” bonus accumulated over the years; Jingdong is re-setting its tactical focus based on profit; Pinduoduo is brutal Growth, repurchase rate improvement, and healthy cash flow are the foundations for its ups and downs. For these three giants, macroeconomic factors must give way to the company’s own factors.

However, in 2020, the situation will change a lot: Ali may allocate some resources to O2O, offline retail, cloud computing, overseas emerging areas, and focus on long-term sustainable development rather than short-term for core e-commerce. Growth / profit; JD needs to find new growth points; the base of Pinduoduo will be huge enough, and more and more like Taobao, the real battle between the two giants has just begun.

The GMV of Pinduoduo is likely to reach 1.5-2 trillion in 2020, just slightly worse than JD.com. There is only one road left in front of it, and that is to challenge the overlord role. And Ali is not afraid of challenges. The two sides will struggle in all fields: Pinduoduo will endeavor to enter the mid-to-high-end brands, strengthen its contract fulfillment capabilities, and develop content e-commerce businesses such as live broadcasting; Ali will fight against Duoduo through the cost-effective / Taobao low-price attack, and strive to keep the mid- to high-end brands . We can’t predict the end of the battle-it is the decision that determines the outcomeLine / operation, not strategy. I want to know: When Pinduoduo breaks through 2 trillion GMV, what is its next main growth engine? Will growth end? Will it flatten out? If high growth is still possible, is it because of something we haven’t realized yet?

(Anyone must personally lay down the place they want to occupy)

9. Game industry: Tencent, vertical categories and overseas markets

It can be said that the game market in 2020 will run around three main factors: the first is Tencent, whose DNF and LOL mobile games are destined to shake the world, and put an end to the “end to hand” era; The second is the vertical category. In 2019, Ark of Tomorrow, Shining Warmth, and Invisible Guardian opened several breakthroughs. Successors will desperately expand the breakthroughs. The third is overseas markets. The platform is a little easier.

If Tencent’s new products achieve unexpected results and vertical categories continue to grow by word of mouth, most of the space for “medium content / distributors” may be squeezed. However, it can’t be generalized. Compared with the giant monster Tencent, most game companies are actually small companies. The vertical explosion like “Tomorrow’s Ark” is enough to feed a large listed company, even if the profit of “Invisible Guardian” (tens of millions) is not low. Hundreds of game companies will pour in vertical categories such as secondary, feminine, and ultra-leisure, as well as new games such as open world and VR / AR.

How many years can the growth of the gaming industry continue? I have always disagreed with demographic analysis of this problem. Today, mobile game users seem to be many, but most of the payments still come from men aged 30-40, followed by high school students / university students. Female users are only partially developed, not to mention the real middle-aged and elderly people. In the field of Internet content, the gaming industry has the strongest fighting power and the most innovative spirit, which is why I am optimistic about it. Where is the next breakthrough innovation? I think it’s interactive narrative and VR / AR. Wait and see.

(Never underestimate the strength of existing leaders in the market)

10. Short video / live broadcast industry: The battle between quick hands and Douyin?

Both Kuaishou and Douyin are approaching their “natural user limits” and have already robbed each other of their users. They are not short of money: we estimate that the fast hand’s operating income in 2019 is about 55 billion yuan, and the vibrato is about 70 billion yuan (excluding headlines and other applications). In the past few years, the two have largely remained well waterless; in 2020, brutal direct competition will become mainstream. I believe that both will survive, and the positioning will become increasingly blurred and comprehensive; other short video platforms will increasingly have no room for survival.

In the field of live broadcast and e-commerce, fast hands and vibrato have proved that the huge and high-viscosity user pool of short videos can be directed to other functions and realized quickly. Where else can we go next? Gaming, e-sports live broadcast, self-employed e-commerce, long video? The key is not to kill the golden rooster in order to get the golden eggs-the tone and stickiness of the short video community is still the most important. Douyin’s product ideas are more specific and more “non-standard”, so the expansion to other functions is slightly slower, but the advertising monetization ability is extremely strong; fast hands are just the opposite.

At the current point in time, my prediction is: Kuaishou will cooperate with Tencent to increase the traffic base and explore more efficient advertising monetization, and headlines will increasingly try their own e-commerce; both will be firm Unswervingly expand to the content end, this content end includes not only games, short videos, but also all content forms such as film and television, VLOG, two-dimensional. Again: both can survive and grow, but their growth paths will become more and more similar. If there must be a winner, who would it be? I have an answer in my heart, but I don’t want to say it now.

(No matter how powerful your opponent is, you must fight fiercely)

11. Internet advertising: “product-effect integration” is the effect of eating the brand?

Since 2017, with the rise of Douyin, short video ads have shown great power. We estimate that the combined advertising revenue of Douyin and Kuaishou will exceed 70 billion yuan this year (not including e-commerce revenue from goods). Short video ads work well, have a good user experience, are flexible, and maintain a certain brand tone. From this perspective, advertisers really do n’t need to maintainBig and improper brand advertising budget. Especially in the economic downturn, anyone hopes that advertising will lead to an immediate increase in sales.

WeChat friends circle ads have been fully effective in 2019. Station B began to try short video tape delivery. Mango TV is planning the first variety show with cargo theme. All in all, performance (CPA / CPS / CPL / ROI assessment) advertising is still expanding and it is evolving. Headline advertising sales can understand ROI even more than customers, and can come up with several feasible advertising sales frameworks at any time. This is the main reason why Tencent’s advertising has been unable to beat the headlines (rather than because there is “no technology in Taiwan” as many people think).

What platforms and formats are most suitable for performance advertising? First of all, you must have tonality (also this nihilistic word, but this is the reality) and characteristics; secondly, you must have a certain degree of interaction or sociality; again, you must have flexible delivery methods and faster responding speed. Douyin and Kuaishou meet all of the above conditions, and station B and WeChat circle of friends also meet. If there is a vertical platform that meets the above conditions, no matter the user base, the single user monetization efficiency will not be too low, right? Will there be a rise of such vertical advertising platforms in 2020? I think it’s possible, but I don’t know who it is.

(The crueler the battle, the more the adrenaline will rise)

12. Audio / Music: The last traffic depression in the Internet?

Obviously, the battle for user duration is nearing completion. At the end of 2019, the average daily bright screen time of Chinese smartphone users is about 4.5-5.0 hours, which is close to the physiological limit. It is impossible to stare at a cell phone all day long. There is only one case where users do not need to stare at the phone or even brighten the screen: audio entertainment, including music, FM, knowledge payment, etc. This may be the last traffic depression of the mobile Internet. Tencent Music and Litchi FM have all been listed or applied for listing, and NetEase Cloud Music and Himalayan are also coming soon.

I’m not at all worried about the traffic prospects of audio entertainment-the current music / audio applications have not yet reached half of the heights of radio / recorders in history, and have not completely occupied the minds of users. Things must be reversed, people are always tired of the “mobile phone bright screen” thing. Listening to books, listening to music, and listening to cross talks are all great forms of entertainment. Moreover, because you don’t need to brighten the screen, audio apps can stay in the background for a long time, without having to join various typesApp users ’eyeball wars (if you have an Android phone, you definitely know it).

The problem lies in commercialization-the advertising prospects of audio entertainment are definitely not as good as video / information streaming (as in the broadcast era); if you rely on paid subscriptions, it will not have any advantages over long videos; if How about paying for knowledge? At present, knowledge payment is basically based on impulse payment, and a solid industry system has not yet been formed. According to the practice of the Internet industry, it is always to seize users, and then slowly consider monetization; but now the users of audio entertainment have been almost seized. Tencent Music realized fast cash flow through the “bright screen entertainment method” of live broadcasting; what about other platforms? I am optimistic about this track, but I have no answer.

(Before you start the battle next year, watch this sculpture first)

Wish you a Merry Christmas and a Happy New Year in advance! I hope next year will be a fruitful year-solving problems among problems is the way of the development of the Internet industry and the way of development of this world.