2016 China Short Video Industry Development Research Report!

Short video refers to a video whose length is counted in seconds. It mainly relies on mobile smart terminals to achieve fast shooting and beautification editing. It is a new type of video format that can be shared in real time and seamlessly connected on social media platforms.

Characteristics of the short video industry:

✩ The video is shorter and spreads faster;

✩ The production process is simplified and the production threshold is lower;

✩ Wide participation and enhanced social media attributes.

▌The development process of China's video industry

Since the establishment of the first video website, China's video website has gone through more than 10 years of development. Tudou, 56.com, PPTV, Youku, Liujianfang and others have been launched one after another. Later, with the rapid increase in the penetration rate of smart terminals and the continuous upgrading of the network environment, competition in the video industry extended from the PC to the mobile terminal, effectively filling the fragmented time of users.

▌The number of investments and financing in the short video industry continues to grow, with most rounds concentrated in the angel round and the A round

According to iResearch statistics, as of July 1, 2016, the short video industry has received a total of 43 investments. Before 2014, the short video industry received little investment. In 2014 and 2015, investment and financing in the short video industry continued to be hot. As of July 2016, there have been 9 investments, which is expected to exceed that of 2015. In terms of the number of investment rounds, the vast majority of investments are seed angel rounds and Series A investments, with a total of 30 investments in these two categories, accounting for as high as 69.8%.

▌Short video industry content production and comprehensive platforms/communities have become two popular investment directions

According to iResearch statistics, in terms of investment direction, content production and integrated platform/community have become the two most popular investment directions, accounting for 65.2% of the total investment. In the first six months of 2016, the investment in content production was much higher than that in the other three areas. In addition, judging from the disclosed investment scale, investments in the tens of millions were mostly concentrated in 2015 and 2016.

iResearch believes that based on the current business model, the main source of income for short video companies is advertising and related marketing revenue, and the value of user data has not been fully explored. How to maximize the monetization of traffic is still a problem that short video companies need to face.

▌Analysis of the industrial chain of China’s short video industry

▌Analysis of the main types of short video platforms in China

▌Business Model (I): Content Marketing with Native Advertising as the Main Strategy

At present, the main business model of the short video industry is content marketing based on native advertising. Its marketing value and characteristics mainly include: 1. Soft implantation; 2. High flexibility; 3. High interactivity; 4. More diversified marketing services.

▌Business Model (II): Expanding Revenue in Other Fields

Currently, the short video industry’s profit model is mainly advertising revenue. At the same time, similar to live streaming , Miaopai , Meipai, etc. have begun to try to generate revenue through rewards and gift giving. More profit models such as social e-commerce and internet celebrity economy need to be further developed.

iResearch believes that short videos are different from simple audio or picture sharing, and have differentiated competitive advantages of being "lively", "intuitive" and "interesting". In the future, more products, brands and companies will try to develop short videos with more experience value and disseminate information more comprehensively, thereby activating customers' purchasing motivation and increasing added value.

▌Short videos have become an important communication medium in the Internet celebrity industry

Public dissemination is the most important prerequisite for internet celebrities to monetize. Overall, short videos mainly serve as a communication platform in the internet celebrity industry chain. Internet celebrities reach a larger user base through communication platforms represented by Weibo, Miaopai, Meipai, and Inke , accumulate fans on video and social platforms, and thus realize the added value of their own brands and IPs. At the same time, video and social platforms will also formulate some strategies to support the development of Internet celebrities. For example, Yixia Technology (whose products include Miaopai, Xiaokaxiu , Yizhibo, etc.) will set up special funds to specifically encourage the development of Internet celebrities.

▌Domestic Case 1: Introduction to the short video social platform Miaopai

Product Introduction:

A video shooting and beautification product launched by Yixia (Beijing) Technology Co., Ltd. Miaopai is the most popular short video community nowadays. On Miaopai, you can see the daily life of celebrities, the fashion creativity of internet celebrities, and the cute and funny moments of UGC users. Functionality: Built-in multiple shooting special effects filters, intelligent voice changing and personalized watermark functions ensure that users can shoot their favorite video effects anytime and anywhere. At present, Miaopai uploads an average of 1.5 million videos per day, plays them 1.7 billion times, and the average daily usage time per person is more than 20 minutes (including some playback on Weibo).

▌Domestic Case 2: Introduction to the short video tool platform Meipai

Product Introduction:

Meipai was first launched in May 2014, focusing on "high-value mobile phone live broadcast + super popular original video". It also features the world's first one-click MV special effects, presenting a different "blockbuster" effect. It has now become one of the most popular short video platforms in China.

▌Trend 1: High-quality content becomes the core of competition

Rich and high-quality content is the fundamental driving force for short video platforms/programs to attract users. Judging from the short video projects that have already gained tens of millions of fans, high-quality content is the basic source of their ability to gain attention. However, short video content cannot just be funny, it also needs to be driven by strong creative planning and production capabilities: for example, Papi Jiang ’s content is a mixture of social hot spots, long-standing social problems, and can trigger emotional resonance. There are not many contents that stand out purely by being funny.

iResearch believes that in the next few years, the core competitiveness of content will be highlighted in the short video industry. Only by differentiating from other platforms and allowing high-quality content to stand out can it truly impress users and the market.

▌Trend 2: The short video marketing market will see rapid growth

✩ Marketing methods are close to users and can better meet user needs

✩ Soft implantation is the main method, which is more likely to stimulate secondary dissemination

✩ Short video marketing will become more important

▌Trend 3: Application of big data in the short video industry

iResearch believes that through the connection of big data assets, it is possible to well realize the connection between business information and "terminals" and "applications". By leveraging the value of data assets, a good business marketing model can be formed, thus triggering a new pattern of marketing: that is, reshaping the marketing process, quantifying marketing effects, enhancing user interaction, evaluating customer experience, controlling marketing costs, breaking down departmental barriers, improving the effectiveness and efficiency of marketing operations , and maximizing the development of business value.