How did Qutoutiao gain 100 million users through fission?

Not only is Qutoutiao not a product of the "Toutiao series", on the contrary, Qutoutiao and Jinri Toutiao are fiercely competing competitors in the information track. However, the two products do have one important similarity: their user growth is amazing.

In April 2016, a team that had experienced multiple project failures within a year ran into trouble in its Internet entrepreneurship . In order to prevent the team from disbanding and many people from losing their jobs, they tried a "sudden" idea: to test the feasibility of information flow products in third- and fourth-tier cities.

In June 2016, after two months of demand survey and product development, Qutoutiao was launched.

Let’s first take a look at what the information market was like in the month when Qutoutiao was launched.

In June 2016, Tencent News had 170 million monthly active users, Toutiao had 96 million monthly active users, Tiantian Kuaibao had 50 million, and Yidian Zixun had nearly 20 million monthly active users. The competition among various products is fierce, even brutal. Under the circumstances at the time, no one would have thought that new unicorns would emerge in the information field, especially in a short period of time.

But Qutoutiao did it.

Only 10 months after its launch, Qutoutiao achieved explosive growth from 0 to 6 million users. One year after its launch, it jumped to the 5th place in the information app list, and its monthly active users increased to 15 million. By the end of 2017, Qutoutiao's monthly active users were close to 40 million, second only to Toutiao and Tencent News, with a year-on-year growth rate of 687%. In March 2018, Qutoutiao received over US$200 million in Series B financing led by Tencent, with a valuation of over US$1.6 billion. The latest news is that Qutoutiao will go public in the United States in September, seeking a valuation of no more than US$3 billion.

Faced with such data, we can't help but ask: How did Qutoutiao achieve its rapid rise in the information battlefield dominated by giants?

One important reason is that it adopts a series of user growth methods centered on giving benefits ( money, gold coins ).

1. What is Qutoutiao’s growth strategy?

Specifically, what methods does Qutoutiao use to increase users?

The most important thing is the point-to-point apprenticeship system . The so-called accepting disciples means invitation. For example, if your friend registers for Qutoutiao through the QR code or invitation code you shared, you can get a certain cash reward, and your friend’s effective reading will be converted into a certain amount of gold coins as "tribute" to you. The gold coins converted into tribute by effective reading are higher than the gold coins brought to the reader himself by effective reading. For example, if your friend earns 10 gold coins by reading, then you may get 20 gold coins.

If your good friend also accepts disciples, then these disciples are your "granddisciples". When you accept a disciple, you can also get a certain amount of cash reward. When the disciple's reading reaches a certain amount, you can also get gold coins.

In addition, if your apprentice has not logged in for a while, you can send him a link to invite him to log in again. This process is called "awakening the apprentice". If the awakening is successful, you can get 1,000 gold coins.

Qutoutiao’s gold coins can be exchanged into RMB at a certain rate. Since the beginning of 2018, the exchange rate of gold coins on Qutoutiao has basically remained at 50 cents for 1,000 gold coins.

The second method is to collect gold coins individually. Users can receive gold coins by reading news, signing in daily, completing tasks, opening treasure chests, and participating in sharing. These methods are extremely low-cost and have no operational threshold.

Taking opening a treasure chest as an example, users can get gold coins by simply clicking on the treasure chest. The number of gold coins each time is between 5 and 10, and the treasure chest can be opened once every three hours. Since gold coins can be exchanged for RMB, there is no essential difference between giving gold coins and giving money, except that the amount of gold coins received directly is usually smaller.

The third major means is to give away benefits. Qutoutiao has a welfare club, and the welfare in the club includes " Tencent Video VIP Monthly Card", "5 Yuan Q Coins", " iQiyi Membership Monthly Card", "iQiyi Membership Weekly Card" and "Kugou VIP Monthly Card". Users can send these welfare benefits to friends. If the other party registers for Qutoutiao in this way, the user can get welfare coupons in exchange for these welfare benefits.

2. How to implement growth measures and efficiently drive user growth

Qutoutiao also has many strengths in its practical operations. Next, we will look at how these growth methods can efficiently drive growth from the three stages of attracting new customers , taking over traffic , and promoting activation and retention .

▌New Customers

In terms of attracting new users, Qutoutiao's strategy is to use private social chains to drive new growth, so the most important task becomes to fully mobilize the enthusiasm of old users and give them sufficient motivation to share, and share in private social chains.

How to stimulate old users’ willingness to share and attract new users? Do three things well:

Give money to old users: provide immediate rewards and long-term rewards

We also give money to new users, so that old users can have a sense of superiority in providing opportunities and value to them when they attract new users, thus reducing psychological barriers.

A simple and crude reward method to reduce the explanation cost for old users when sharing

Qutoutiao has a new user bonus, and new users can get money when they download. This solves points 2 and 3. As for how to solve point 1, let's see how Qutoutiao operates in attracting new users:

Invite via link: After inviting friends, users can get cash directly, usually ranging from 6 to 10 yuan. If you use QQ channels to attract new customers, you can also participate in a lottery.

Face-to-face QR code scanning : Invited users can participate in a lucky draw, with prizes of 20, 50, 200 yuan gold coins, Midea 3-horsepower cabinet air conditioner, ip honeX256g, 888 yuan, 1,000 yuan and Haier drum washing machine.

Welfare coupons: The welfare club provides a series of welfare products, such as video memberships, phone bills, Q coins, etc. Users send out the welfare. If the friends who receive the welfare eventually log in to Qutoutiao, they can get two welfare coupons.

It can be seen that in the part of inviting friends, the product gives old users sufficient immediate incentives, that is, they can get some kind of reward immediately by sharing.

Of course, if the users you invite as your apprentices read for a certain period of time, they can pay you gold coins. This is a long-term material reward.

In terms of copywriting , Qutoutiao is also very distinctive.

The first is to give users clear tasks. The expression does not say "you will get money by inviting users", but "invite 2 friends and get a reward of 10 yuan each" or "invite 6 friends and get a reward of 10 yuan each".

A clear amount of tasks gives you a thrill of beating monsters, which can speed up the pace of sharing and fission.

Second, the copywriting of Qutoutiao is somewhat deceptive . For example, when a user clicks on the "My" page, a prompt pops up saying "Get the following benefits for free". The interface they enter still shows "Get for free", but when they click "Get", it will say "You don't have enough coupons. Go and invite your friends to earn coupons~"

Therefore, the replacement of “share and receive benefits” with “receive benefits for free” is still somewhat deceptive.

Imagine if this kind of copy appeared in first- and second-tier mainstream apps, such as Meituan , would users feel deceived and offended? Very likely. Every time a message "Get free benefits" pops up, it actually means "Only share to get benefits", and you cannot "unsubscribe" from this pop-up page.

However, users in third- and fourth-tier cities can accept it well. Why is this? In the last part of this article, I will try to answer this question.

▌Traffic Transfer

Now that we have fully mobilized the enthusiasm of old users to consciously attract new users, how can we successfully retain the newly reached users?

Red envelopes come first, and the benefits are higher than the costs

As long as new users download the Qutoutiao APP, they can get a new user red envelope of at least one yuan. What is the cost of downloading an APP using wifi? If you get one dollar for downloading, the cost of downloading itself can be instantly ignored.

During this process, users will have a sense of "loss", which seems to be an emotion that is rarely mobilized in marketing . What it actually means is that a certain amount of money is already yours, and you can get it as long as you download it. If you don't download it, it's yours and you didn't want it.

Moreover, when it comes to inducing new users to download the APP, Qutoutiao also has a very clever function setting.

As I just said, Qutoutiao starts with red envelopes. New users can learn from old users (their mentors) and copywriting that there will be new red envelopes to receive, but the process of receiving red envelopes is divided into several steps:

Newcomer red envelope - Download the APP - Click to receive the red envelope - Log in - Click to receive the red envelope again - Jump to the "My" page, and a "Newcomer Benefits" page will pop up - Click to receive and jump to the friend invitation page - There is a treasure chest on the page that can be clicked to get gold coins

No wonder some people say that the city is too complicated.

Qutoutiao not only acquires customers by using a one-yuan red envelope, but also brings users into its own gold coin system and invitation system through a series of inducements to receive benefits. The latter is the core of Qutoutiao's gameplay.

Judging from the copywriting, Qutoutiao conveyed the following information in the part of receiving traffic:

There is money to be taken

There is a lot of money to be made

Money can be taken immediately

Money can be spent in offline scenarios

This can almost completely dispel users' concerns. How did Qutoutiao do it? The red envelope copy of Qutoutiao is:

Congratulations on receiving a new member bonus! You can get up to 18 yuan after opening it and withdraw it on the same day.

Of course, the word "highest" is so small that it is almost invisible. But 18 yuan is still a very impressive number, enough to drive users to follow the rules. It was also emphasized that the money could be withdrawn on the same day to dispel concerns.

From the above, we can also see that what attracts new users to Qutoutiao is not the content or the social chain, but the temptation of cash. In other words, a complete game system + cash system is used to attract users.

▌Activation and retention

Qutoutiao has entered a relatively mature product stage, and user retention is mainly achieved through the mature gold coin system mentioned at the beginning of this article.

This gold coin system can effectively achieve user retention and activation for the following reasons:

First, users can awaken their apprentices to achieve supervision and motivation among users. This kind of awakening chain is often based on private social chains, so it can be expected that the effect will be better than reminders from strangers.

The second reason is that the users themselves are deeply involved in this "gold coin system". Once a user has an apprentice, he has a way to make money on a "scale". The more deeply involved he is, the more profit he will get. Therefore, the deep involvement of the game drives user usage.

The third reason is the gold coin system. Why use a coin system? Considering that gold coins can be exchanged for RMB at a certain rate, in essence, it is RMB. Its function is to tie the interests of the platform and the interests of users together. The longer the user uses the system, the more RMB a certain amount of gold coins can be exchanged for. This chain effect will also encourage users to use the product for a longer period of time.

3. Why does Qutoutiao’s approach work?

We have already talked about Qutoutiao’s user growth methods, and how it was implemented in each stage of attracting new users, accepting new users, retention and activation, but we still have to ask, why is such a pyramid scheme-like gameplay so effective? In other words, why would users buy it?

We will also answer the question raised above: Why don’t users feel offended by the somewhat deceptive copywriting of Toutiao?

This is related to the characteristics of the users themselves. That is, the characteristics of users in third- and fourth-tier cities and non-tier towns are the other side of this growth myth, which has made Qutoutiao a success.

Let me show you some data. In the past one or two years, people often said that Toutiao's users were mainly residents of third- and fourth-tier small cities. Since the beginning of this year, Pinduoduo has become the representative of "user sinking". However, in terms of penetration, Qutoutiao has gone further than both Toutiao and Pinduoduo.

Data source : Analysys Qianfan

According to the data, Qutoutiao has the smallest proportion of users in super first-tier and first-tier cities, and the largest proportion of users in third-tier and below regions. This shows that the user composition of Qutoutiao is more "downward" and further away from big cities that represent developed economies.

Based on this data we did some analysis.

The first thing we need to note is that the Internet has developed very rapidly in recent years, and a variety of product forms and business models have continued to enter the market. These rapid changes are "dazzling" for Internet practitioners.

However, these developments and changes are not understandable to users in small towns or even in rural areas. In their cognitive system, the people, rules, and operating mechanisms behind a product are completely a black box.

In other words, users cannot understand the business rationality behind those sharing, reading, and various ways of playing. They may be able to vaguely sense that there is a complex mechanism operating behind the product, but it is like a black box, a complex system that is difficult to understand. But they are still using their limited rationality to try to understand and explain a product.

So this leads to two results:

First, commercial practices that seem completely demystified to us are, for third- and fourth-tier users, the actions of legislators and order providers, the realm of gods, and cannot be challenged.

Psychologically speaking, for the new Internet users reached by sinking - people in third- and fourth-tier cities or rural areas, the Internet order itself is treated as empirical material to be experienced and learned, rather than an object of scrutiny or challenge. Like anthropologists entering a new culture, they dare not raise questions easily, but try to understand. Therefore, even if giving benefits for free = sharing benefits, it can be easily considered legitimate.

This is related to the rapid development of information, which has created a huge information gap between first-tier cities and fourth- and fifth-tier cities.

Second, in our opinion, the completely disenchanted business practices may be dangerous and uncontrollable for small town and rural users, but their results are full of unknowns and possibilities, and even contain huge wealth that can be obtained.

In many counties and rural areas, there is a myth that one can make hundreds of thousands or millions of dollars with a single account, which exacerbates this mentality. Without understanding the Internet environment, many users tend to believe that Qutoutiao can bring extremely lucrative profits, and the exposure of Qutoutiao's rankings has intentionally or unintentionally amplified this tendency.

So it is hard to say that users of Qutoutiao, which has 50 million active users, all consider issues within the scope of benefit-cost, and believe that their time is not valuable, so they can squander it indefinitely in exchange for some profit. I believe to a certain extent that Qutoutiao intentionally takes advantage of small town and rural users' ignorance of the business world and the Internet, or some kind of information asymmetry, to make users believe that there is huge profit potential and wealth potential hidden in the black box behind the product. If users find the right method, they can get huge benefits. And this benefit is far higher than the time cost I paid. Rather than convincing users that their time is worthless, it is better to exchange less money.

Under this assumption, since first- and second-tier cities have very little expectation for how this game is played - with full information, they know that they won't make much money, so it will be difficult for Qutoutiao to capture the market in first- and second-tier cities.