The opportunity for Kuaishou to turn over is coming, and the micro-short drama ushers in centralized governance, can Kuaishou seize this opportunity?
Recently, short dramas have become all the rage, attracting a large influx of capital, resulting in the Hengdian Film and Television Base once being crowded by the crowd who came to shoot short dramas, and was even jokingly called "Vertical Shop".
However, with the release of the State Administration of Radio, Film and Television in November for the supervision of micro-short dramas, Kuaishou has become the focus of heated discussions on the whole network.
As of the third quarter of 2023, Kuaishou's overall performance is acceptable, achieving profitability for three consecutive quarters, with a net profit of 31700 million. However, Kuaishou's performance is not commensurate with its performance, with a decline of nearly 20% this year. Why is Kuaishou obviously profitable, but it can't promote ** appreciation? The main reason is that the capital market generally believes that Kuaishou's development potential has reached its peak, so it is reluctant to invest in it. However, now, with the rise of the short drama industry, Kuaishou may usher in a good opportunity to turn around.
Since the launch of the short** social platform in 2013, Kuaishou has maintained rapid growth, and in 2017 it became one of the world's largest single live streaming platforms, and in 2018, it began to set foot in the e-commerce business.
So far, Kuaishou's performance has been good, with a total revenue of 94.2 billion yuan in 2022 and a cumulative number of users who follow each other to 26.7 billion.
However, despite the gratifying performance, why is it difficult for Kuaishou to win the favor of the capital market? On the one hand, Kuaishou has been questioned due to some issues, such as some bad Internet celebrities creating a bad atmosphere in the live broadcast room, which led to the company being subject to strong supervision. On the other hand, Kuaishou's current competitive pressure in the market makes people feel that it doesn't have many highlights worth investing in.
Kuaishou lacks outstanding advantages in the market and has been firmly suppressed by Douyin, while also facing continuous catch-up by competitors such as **.
Although the monthly performance seems to be good, Kuaishou seems to lack a competitive advantage compared to Douyin and **hao. Whether it is the number of users or the popularity, it cannot match Douyin.
The capital market generally believes that why should you choose to invest in Kuaishou instead of Douyin or ** account? Douyin is the leader in the industry, and the ** account has a potentially large user base.
In April this year, it was reported that Tencent was considering a stake in Kuaishou, and although Tencent later denied the news, it still brought volatility to Kuaishou's stock price.
Kuaishou originally planned to break into the overseas short ** market, hoping to succeed in the overseas market, but in the end it lost to Douyin's overseas version of TikTok.
Kuaishou's overseas version accounted for only 2% of the report in the three quarters of this year, and considering various investments, Kuaishou's overseas business is not only not profitable, but is losing money.
Now, Kuaishou has finally ushered in its own opportunity. The State Administration of Radio, Film and Television has issued detailed rules for the review of online micro-short dramas, which may become an important opportunity for Kuaishou to turn around.
Kuaishou's online micro-short drama is one of the earliest fields in China's short ** platform, and it is also one of its unique advantages, and Douyin and ** have not yet been able to surpass.
As early as 2019, Kuaishou set up the Kuaishou Small Theater to provide a display platform for micro-short dramas. In 2020, the "Kuaishou Xingmang Project" was launched, aiming to help the development of online micro-short dramas.
In 2022, the number of Kuaishou's skit users has exceeded 2600 million, one of which is a short drama called "The Eldest Princess is Up" has won an astonishing 3700 million**.
Subsequently, Kuaishou continued to launch micro-short dramas similar to "The Eldest Princess is on the Top" to promote its own development in the field of micro-short dramas.
In this field, neither Douyin nor ** can be compared with Kuaishou. Whether it is in terms of the amount of ** or the quality of micro-short dramas, it cannot be compared with Kuaishou.
In addition to the fact that Kuaishou has a long history in this field, what is more important is how much Kuaishou attaches importance to this field. Each micro-short drama is the result of Kuaishou's careful polishing, which is one of the reasons why Kuaishou can maintain its leading position in this field.
Although many of Douyin's micro-short dramas are similar in style to Kuaishou's, they all have the theme of love, but Douyin focuses on modern love themes, while Kuaishou features ancient style of love.
Judging from the volume and effect, users are more inclined to the ancient style of love micro-short dramas.
Kuaishou has done a better job than Douyin in the classification of micro-short dramas, dividing micro-short dramas into four major types: urban feelings, family empathy, youth inspirational and comedy.
Through big data classification, micro-short dramas suitable for users are recommended to them, and each genre has achieved good success.
This year, another outstanding work was launched on Kuaishou's micro-short drama - "The Reason Why I Go Back to Seventeen", which exceeded 400 million in just three weeks after it was launched, and was praised by Chinese film reports. Even though each episode is only 4 minutes long, it attracts a large audience.
From this work, it can be clearly seen that Kuaishou attaches great importance to short dramas, and the details and story lines in the plot are handled perfectly. Some netizens even said that such a level of filming can be filmed into a TV series, not just a short drama.
The reason why short dramas are so popular is first of all because the content is short, each episode is only a few minutes, and the whole work is only about an hour, which can meet the needs of users for fragmented time.
Secondly, the short duration of the short drama provides the creator with the time and money to create high-quality content.
The reason why Kuaishou has achieved great success in the field of short dramas is that it does grasp the two points of short content and fragmented time needs, but Kuaishou is also facing many difficulties and potential crises.
Most users in the market have a relatively stereotypical impression of Kuaishou, thinking that it is more "rustic", and the quality is not as good as Douyin and so on.
Although the micro-skit improves this impression to a certain extent, there are still many users who hold this opinion. If Kuaishou wants to turn around, it must change this stereotype. This means that there is a need to put out more high-quality productions, and not just in the field of micro-short dramas.
Yes, this does mean that Kuaishou needs to invest more in other directions, such as sports, ** and other fields. On the other hand, with the release of the relevant rules for online micro-short dramas by the State Administration of Radio, Film and Television, Kuaishou will face challenges from more competitors, no longer just Douyin and **.
Like Youku, Tencent**, iQiyi, Mango TV, etc., will also join this competitive track. Although they have long been involved in the field of online micro-short dramas, they have always been inferior to Kuaishou.
However, once the SAPRFT issues the relevant rules, they will change their attitude towards the market and may adopt a stronger competitive strategy. This will put direct competitive pressure on Kuaishou.
If Kuaishou can maintain its leading position in the highly competitive micro-short drama track, the capital market will definitely pay more attention to it. For Kuaishou, this is not only an opportunity to turn around, but also an opportunity to achieve greater revenue. Micro-short dramas can achieve greater revenue through product placement, endorsements, and e-commerce monetization.
Do you think Kuaishou can seize this opportunity to defeat his old rival Douyin? Hotspot Engine Program