Due to the epidemic in the first half of this year, the national economy slowed down; but the live broadcast industry has undergone great changes at this time, and everyone has more time for entertainment; different users have different demands for products, for example: Douyu is more about games, Douyin is about talents, Taobao is about live broadcast sales, etc.; the author of this article analyzes Douyu live broadcast from the perspective of the market and users.

1. User Analysis

The ultimate service object of the product is the user. First of all, we need to figure out who the target users of our product are; we need to decompose these users, for example (user's age, gender, occupation, income, city, education level, etc.). The purpose of decomposing these users is to facilitate us to build scenarios for target users.

Different users have different pain points, and only the pain points found in the scenario are the most convincing (when analyzing users, you should list as many user pain points as there are user portraits).

2. User Segmentation

1. Geographical distribution of users

Main distribution areas of users Data source: iResearch

The geographical distribution is relatively uniform, indicating that the economic strength of users is relatively low.

It can be found that Douyu users are not highly concentrated in economically developed areas, but are relatively evenly distributed across the country; although there are still many users in economically developed areas, this is related to the number of Internet users.

This shows that Douyu Live is not a software for high-end groups. To some extent, it has a relatively low-end user group like Kuaishou.

In summary: the behavior of watching live broadcasts is more in line with the practices of users who are not very popular in the real world; because it is difficult to find enough sense of presence in the real world, they go to live broadcasts to seek pseudo one-on-one performances; and even occasionally save some money to attract the attention of the anchor. After all, it is much easier to get attention there than to be favored in reality.

2. User gender

User gender ratio Data source: iResearch

As can be seen from the above figure, the gender distribution of male and female users of Douyu Live is unbalanced, with male users accounting for 67.18% and female users accounting for 32.82%, which is more than twice the proportion of female users.

The live streaming platforms attract users mainly by broadcasting male anchors playing games and female anchors dancing and singing, while there are many more male game users, and those who watch the live broadcasts of beautiful women are also mainly male; so it is not surprising to see such a distribution ratio. The large number of male users is actually due to their greater love for games and the attraction of beautiful women.

Summary: Male users may play games all night long and even ignore their girlfriends' calls, while female users are fanatical about shopping and watching TV series.

This also makes a big difference in the types of live broadcasts watched. Male users mostly watch game-type content, and have a greater demand; while female users mostly watch beauty live broadcasts. Douyu Live is positioned mainly in the game category, so it is normal that male users account for a larger proportion.

3. User age

User age distribution chart Data source: iResearch

As can be seen from the above figure, the age of users watching live broadcasts is mainly distributed between 25 and 35 years old, and these two age groups account for more than 60% of the total

• Most users under the age of 24 have not yet established a family and have little pressure. There are too many things they can play and they can play with friends. In this case, live streaming is not that attractive.
• Users over the age of 35 have devoted their energy to the education of the next generation and have relatively high family pressures, namely the so-called "middle-aged people who can be scolded" on the Internet; all their energy is invested in making money and taking care of their families, and their demand for entertainment is relatively low.

It is clear why the main force of users is between 25 and 35 years old.

Summary: Users aged 25-35 may have already entered the workforce. Although they are not under much pressure at this time, they do not have much free time. In addition, most of their friends have also started working hard, and the probability of everyone working in a group to do one thing is very low.

Therefore, their characteristics are fragmented time, loneliness, lack of family, and little pressure in life.

At this time, live streaming is their best choice. Live streaming does not require continuous time like games; its lively atmosphere can also eliminate loneliness, and the less stressful life allows users of this age to have the energy to engage in this kind of entertainment activities.

4. User scenarios

• User attributes: male, 19 years old, unmarried.
• User behavior: I love LOL but my skills are average, and I want to learn more advanced technical operations.
• User characteristics: College students.

User scenarios:

Fat Tiger is a college student who loves League of Legends very much and often plays it with his roommates in the dormitory. However, his roommates think he is a bad player and cannot keep up with him, so they often don't play with him. However, Fat Tiger really wants to fit in with them.

Fat Tiger likes the male knife (LOL character) very much, but this hero is difficult to operate and he doesn’t understand many of the operations.

So his roommate recommended him to watch Douyu Live, saying that there was a host named Zhixun who was very good at playing the male sword and his live broadcast style was also very interesting. So Fat Tiger downloaded this app to watch it, and learned a lot about the operation of the male sword. His technical level also improved a lot, and his roommate was willing to take him to play together.

• User attributes: male, 27 years old, unmarried.
• User behavior: Since I work alone in Beijing, I often don’t get recognition from my boss and others, which makes me feel lonely.
• User characteristics: ordinary white-collar workers.

User scenarios:

Lao Zhang is a migrant worker in Beijing, working hard alone in Beijing. He is under great pressure from work and usually likes to stay at home alone. He feels very lonely and wants to be in the crowd but cannot fit in with other people.

One time, I accidentally discovered the app Douyu Live, which contains many hosts with particularly interesting live broadcast styles. One of the hosts that Lao Zhang likes is very enthusiastic towards his fans, and his live broadcast room is also very lively. Lao Zhang likes to communicate with them very much. Lao Zhang likes this host's live broadcast room very much, as if he has found a sense of belonging, and he will watch this host's live broadcast every time he gets off work.

• User attributes: male, 32 years old, unmarried.
• User behavior: He works on a construction site. He is old enough to get married, but due to the nature of his job, none of the women his family members approach for blind dates like him.
• User characteristics: construction site worker.

User scenarios:

Nobita is a worker on a construction site. He has reached the age to get married, but the girls he went on blind dates with none of them liked him. He spent a lot of money but still failed to get the girls' approval. Even if there were girls he liked, he didn't dare to show his love to them. He was very inferior and began to doubt his social status.

One time, he accidentally discovered the Douyu Live APP, and he found a female anchor he liked very much; this anchor was very interesting, and Nobita liked her very much, so Nobita tried to give this anchor a plane; then he got the attention of the anchor, who praised Nobita for being generous, and said to Nobita, "Brother loves you."

Here Nobita was recognized, and he felt that his social status was not so humble anymore. From then on, Nobita would give this anchor a thumbs-up while eating instant noodles (Note: Although the female anchor is pretty, you have to watch her rationally).

3. User demand pain points

1. User needs

1) Ordinary college students

Basic needs: If you want to learn techniques from hosts that are suitable for your type of game, you can accurately find hosts that are suitable for your type of game based on the host tags in Douyu Live.

2) Ordinary white-collar workers

Expected needs: want to interact and chat with others, want to integrate into a large group, and be able to interact with the host or other users in the host's live broadcast room while watching live broadcasts.

3) Ordinary migrant workers

Exciting needs: They want to be encouraged and recognized by others, to gain a sense of belonging through mechanisms such as fan points, to support their favorite anchors, and to receive praise from the anchors.

2. User pain points

Live broadcast classification: Live broadcast platforms have different live broadcast classifications, but most platforms do not have a standard classification of the anchor's specialties. For example, many gamers who want to learn the skills of individual LOL heroes cannot find a suitable anchor to learn from.

Douyu Live has made the classification of this section particularly detailed. Each anchor has a different label, making it easy for users to find their favorite anchors to watch, greatly reducing the difficulty of users' searches.

1) Seeking excitement and wanting to fit in with a large group

Young white-collar workers working hard in big cities have few friends around them and are always alone after get off work. They want to seek excitement and group life.

Douyu Live provides him with such an online platform, where he can communicate and interact with the anchors and fans in the live broadcast rooms of various anchors.

2) Want to find social recognition

At this stage, most young people are under great work pressure and do not get social recognition. Even if they spend money and energy, they cannot get recognition from others. They want to get spiritual comfort and mental satisfaction.

In each live broadcast room of Douyu Live, every anchor treats his fans like family members to please them, and users can get praise from the anchor if they spend money. Many users are willing to spend their spare time here and invest their money and energy to get the recognition of the anchor.

3. Conclusion

The ultimate service target of the product is the user. First of all, we need to figure out who the target users of our product are and break down these users (for example: the user's age, gender, occupation, income, city, education level, etc.).

The purpose of decomposing these users is to facilitate our construction of scenarios for target users. Different users have different pain points, and only the pain points found in the scenarios are the most convincing.

Note: When analyzing users, you should list as many user pain points as there are user portraits.

4. Market Analysis

The main purpose of market analysis is to determine whether you can make money.

We need to come up with powerful data analysis. When faced with these data, we cannot analyze for the sake of analysis, but must dig out the real situation behind the data.

1. Industry Background

As we enter 2020, the competitive landscape in the game live streaming industry becomes increasingly clear and fierce.

• On the one hand, with the two leading platforms (Douyu and Huya) going public one after another and many Internet giants rushing to enter, the game live broadcast industry pattern of "two super and many strong" has been basically established;
• On the other hand, with the continuous establishment of copyright regulations for game live streaming and the gradual increase in the value of copyrights for e-sports events, live streaming platforms will pay more attention to refined content operations and the development of diversified models.

At the same time, business expansion such as cloud gaming, live streaming, and content payment have become new growth points for the platform, and the second half of the game live streaming industry will be even more exciting.

Image source: iResearch

Summary: As one of the two existing game live streaming giants, Douyu Live is mature, has a broad business scope, and a strong capital base. It is backed by the game and e-sports copyright resources of its major shareholder Tencent. Douyu has natural advantages in live broadcasting of large-scale e-sports events, self-made e-sports events and activities, and signing top e-sports teams.

At the same time, with the help of Tencent Games' "big live broadcast ecosystem", the Douyu platform and anchors will be able to obtain better growth and promote the steady development of the game live broadcast industry - it is definitely an opportunity to develop in line with the trend in the second half of the live broadcast industry.

2. Market Status

With the rapid growth of the market size of China's game live streaming platform, the diversification of platform revenue and the show-like operation, the revenue of game live streaming platforms will continue to maintain rapid growth.

According to the statistics of the "In-depth Research Report on Business Model Innovation and Investment Opportunities in China's Online Live Broadcasting Industry" released by the Prospective Industry Research Institute:

In 2014, the size of China’s game live streaming market was only 430 million yuan.

In 2015, the scale of China's game live streaming market exceeded 1 billion yuan, and has since shown a rapid growth trend.

As of 2017, the scale of China's game live streaming market reached 8.7 billion yuan, a year-on-year increase of 170.9%; the number of users reached 270 million, with a growth rate of 28.57%.

In 2017, the overall scale of game live streaming users in China showed explosive growth, with the main growth coming from the conversion of mobile e-sports game users.

As the live game streaming industry enters its mature stage and the demographic dividend fades, the user growth rate will further slow down, and various platforms will begin to refine their operations and make profitability their primary goal. Preliminary estimates show that the market size of China's live game streaming industry will exceed 10 billion yuan in 2018, reaching approximately 14.12 billion yuan, a year-on-year increase of 62.3%.

The user scale has reached about 300 million people, and it is predicted that the scale of China's game live broadcast market will exceed 20 billion yuan in 2020, reaching 24.63 billion yuan.

As the market gradually becomes saturated, it is expected that the growth rate of game live streaming users will gradually slow down in the next few years.

It is predicted that the number of Chinese game live streaming users will reach 360 million in 2020, a year-on-year increase of 9.09%.

Data source: compiled by Qianzhan Industry Research Institute

Summary: Judging from the current market conditions, the live broadcast industry has reached saturation; the growth rate has dropped to around 10% since 2018, but it is still in a state of continuous growth; and with the continuous development of social economy, people are paying more and more attention to entertainment payments, and the overall economic benefits of the live broadcast industry are also increasing. The estimated revenue in 2020 is also expected to reach 24.6 billion.

Due to the epidemic, people's entertainment consumption has been greatly reduced, and the live broadcast industry, an online entertainment method, is the biggest beneficiary. I personally feel that the expected revenue will exceed this valuation; for Douyu, a giant in the live broadcast industry, the expected revenue of 24.6 billion can also be a big share.

3. Business Model

1) Reward mode (common mode)

The audience pays to recharge and buy gifts for the anchor. The platform converts the gifts into virtual currency. The anchor withdraws the virtual currency and the platform takes a commission.

If the anchor belongs to a union, the union and the live broadcast platform will settle the accounts together, and the anchor will receive a salary and a partial commission.

This is the most common profit model for live streaming products. Common ones such as Huajiao and Inke belong to this model.

The platform can set various gift pictures and types based on its own live broadcast characteristics; for example, Douyu and Huya use fish balls, tiger food, etc. as gift names to increase the platform's characteristics and distinguish it from other platforms.

2) Advertising model (common model)

The live broadcast platform is responsible for inserting advertisements in the APP (including banners, live broadcast advertising images, etc.), in the live broadcast room or in the live broadcast gifts, and settling fees with advertisers based on displays/clicks or purchases.

3) Shopping guide mode

Generally, e-commerce live streaming products/auction products adopt this profit model.

The anchor celebrities have their own stores (Taobao stores, WeChat stores, etc.), or there are stores that need anchors to carry out marketing and promotion; when the anchor is broadcasting live, he or she recommends store products, and users can directly purchase them with one click or add them to the shopping cart; the live broadcast also has discounts or participates in auctions, and ultimately the anchor and the live broadcast platform share the profits according to a predetermined ratio.

4) Paid live streaming

There are two modes for paid live streaming:

• One is that the anchor needs to pay to start live broadcasting, and the live broadcast platform provides more advanced live broadcasting services;
• The other is that viewers need to pay to watch the live broadcast, with the host setting the entry fee, and the platform and the host sharing the profits (for example: you need to pay to watch the players’ perspective in a LOL game).

In addition, the payment model can also be divided into charging by session, charging by minute, etc., which makes it convenient for the anchor to choose the live broadcast method that suits him/her and reasonably increase his/her live broadcast revenue.

5) Member value-added services

Members can be divided into two categories: anchors and viewers. After paying to become members, they can receive exclusive privileges, such as: For member anchors, some privileges can be provided:

• The live broadcast room opens up more functional permissions, such as: adding field control, increasing the upper limit of chat room personnel, doubling income, opening private live broadcast rooms, etc.;
• Identity privileges, such as: honorable medals, accelerated upgrades, homepage recommendations, etc.

Some of the privileges available to members include:

• Functional privileges, such as: personalized likes, privileged gifts, video connection, invisible entry, etc.;
• Identity privileges, such as: avatar beautification, member logo, entrance special effects;
• Content privileges, such as viewing designated (paid) content;
• More other customized privileges can be customized according to the characteristics of the live broadcast room.

6) Game joint operation

This scenario is common on game live streaming platforms. Game manufacturers hope to embed game entrances during live broadcasts. If viewers click on and download games through the entrance while watching the live broadcast room, the platform and the manufacturers will share the profits.

At the same time, the game live streaming platform can also recommend game peripheral products and game props; sell game peripheral products during live streaming to increase the revenue of the game platform, which is shared by the anchor, platform and manufacturer.

In addition, there is another small game live broadcast mode, which embeds small games such as bullfighting and golden flower into the live broadcast; the anchors interact with users by playing small games, increasing the user's online time, and users purchase gold coins to play games, increasing the revenue of the game platform.

7) Paid promotion of anchors/programs

Similar to the advertising space selling model, the anchor can pay the platform to provide promotional space to expose the anchor, and the platform will settle the fees with the anchor based on the exposure and viewing volume.

8) Match prediction

This is similar to online gambling, but it’s a bit of a gray area, and it’s used in game/sports live broadcasts.

The betting platform is embedded in the live broadcast room. During the live broadcast, the audience places bets through the betting platform, and the final profits are shared between the betting platform and the live broadcast platform.

9) Copyright Release

It belongs to the secondary use of content. The live broadcast platform can protect the live broadcast content and provide it to the distributor in the form of copyright sales, and the distributor will process the content for a second time.

10) Corporate publicity

The business model of the To B live broadcast platform is that enterprises pay the live broadcast platform to apply for live broadcast, or need technical support from the live broadcast platform; the live broadcast platform provides conference promotion and other services for the enterprise, and finally provides the enterprise with viewing data.

11) Paid education

The business model of online education products is to use live streaming platforms to sell courses; students pay for learning, and the live streaming platform ultimately shares the profits with the school/teachers.

Other related products can also be sold on the education platform. For example, one of Fang Wei’s live broadcast clients, as a live broadcast platform for teaching music courses, can also sell various related musical instruments to increase other revenue for the education platform.

12) Paid Q&A (live audio)

One of the business models of voice live broadcast products: the answerer starts a live broadcast and answers questions; the questioner needs to pay to watch the live broadcast or view the answers, and the profits are shared by the platform and the answerer.

13) Payment for anchor operation tools

It is a kind of value-added service, which provides anchors with various data statistical analysis tools, guides anchors to maintain fans and improve live broadcast effects.

The functions that the tool can support can be:

• ① Live broadcast data statistics function;
• ② Analysis of live audience behavior;
• ③ Live audience relationship maintenance function;
• ④ Live broadcast optimization suggestions.

Summary: The above models are common profit models for live streaming apps nowadays. They can exist independently or be mixed.

In short, live streaming is essentially a traffic monetization channel, just like news, e-commerce, videos, tools and other products; its value to users is to allow users to discover their interests, support their favorite anchors, and consume their content.

For live streaming platforms, their business goal is to explore user access paths and tap into the value of traffic.

V. Development Trend

1. Capital Trends

Tencent invests in leading game live streaming platforms. After the two leading live streaming platforms announced that they would be going public, they disclosed on the same day that Tencent had completed the last round of investment in them before their listing.

Tencent's eventual intervention reflects its desire to control the leading game live streaming platforms. In addition to ensuring the security of its own cash flow content - the main channel for disseminating game content, it also shows certain expectations for the platform's future monetization capabilities.

Ultimately, these two investments not only resulted in the two game live streaming platforms with the largest market share on the market having the same major shareholder, but also had a certain impact on other game companies and live streaming platforms.

2. Content Trends

Tactical survival online games are on the rise, and new game types are expanding the audience for live streaming. Last year, a series of tactical survival games represented by "PlayerUnknown's Battlegrounds" attracted a large number of game live streaming users.

The reasons why this type of game is popular are as follows:

• The live broadcast of this type of game is highly entertaining; compared with other battle games, tactical survival online games have more random content in the viewing experience; therefore, the viewing experience is better;
• Game viewing is relatively intuitive, which can attract mobile gamers and even non-players to watch game live broadcasts;
• This type of game is becoming e-sports very quickly, and can provide a large amount of high-quality game live content to the audience, meeting the audience's demand for high-quality live content of battles.

3. Platform competition trends

The online entertainment industry is experiencing a coexistence of competition and cooperation. As the game live streaming industry continues to grow, competition in game live streaming is not limited to the industry itself, and will face more competition from other forms of online entertainment; such as the recently popular short video platforms, which have greatly occupied the overall online entertainment time of Internet users.

Although game live streaming has the unique characteristics of high immersion and long duration, and has a certain resistance to emerging entertainment forms, it has also been affected to a certain extent.

On the other hand, a large amount of highlight content in the live broadcast can be disseminated to the outside through short videos, thereby converting short video viewers into game live broadcast users.

4. Platform business development trends

Further strengthen the cooperation between the union and the brokerage company to increase the platform income. The union and the brokerage company bring the following advantages to the game live broadcast platform:

First of all, unions and brokerage companies can help platforms manage and train a large number of anchors. Game live streaming platforms have a large number of anchors, and it is not realistic to rely solely on the platform to manage a large number of anchors. There are great difficulties in terms of management capabilities and resource allocation. Therefore, by cooperating with unions/brokerage companies, the platform can reduce a certain amount of anchor management costs.

Secondly, in order to increase their income, unions and brokerage companies provide training and operational activities for their anchors. Compared with working alone, anchors who join guilds and brokerage companies can get higher resource assistance at the beginning, which is helpful in increasing reward income.

Of course, the live streaming platform will also avoid the dominance of a single super-large union/agency, so it will introduce multiple unions and agencies to maintain a balance.

5. Upstream industry development trends

The diversified broadcasting of e-sports event content and the maturity of third-party event copyright IP also enable content production companies to make choices based on the event and their own circumstances when broadcasting events to platforms - choosing to broadcast exclusively on a single platform or broadcast uniformly on all platforms.

Compared with broadcasting on all platforms, broadcasting events on a single platform can provide content production companies with higher content copyright fees and event promotion resources; however, unified broadcasting on all platforms can provide coverage for different users on more platforms, which is helpful in enhancing commercial advertising cooperation.

Committed to developing third-party event IPs and promoting the commercialization of events. As an important link in the industry chain, content production companies are not satisfied with being limited to the role of organizers, and intend to have a higher voice and commercialization capabilities in the e-sports industry chain by creating event IPs.

As the industry develops, a number of third-party event IPs with spectacular visual appeal have emerged; content production companies use these event IPs as the core to provide comprehensive advertising services that integrate their e-sports resources, further enhance the commercialization capabilities of the events, and provide higher value to advertisers.

Taking the NSL event as an example, in addition to traditional advertising display positions such as the event site, commentary desk and live broadcast page, it also provides additional services such as anchor endorsement and KOL social media reposting to enhance the comprehensive brand service for advertisers.

VI. Conclusion

As a giant in the live streaming industry, Douyu Live's economic growth was not actually affected in 2020 when the user growth rate decreased year by year.

Due to the epidemic, most offline entertainment industries have suffered a fatal blow; and the live broadcast industry happens to be one of the biggest beneficiaries. People's entertainment consumption, which has nowhere to go, has mostly turned to online entertainment live broadcasts, which has also greatly increased user activity during this period.

During the epidemic, the country strongly supported live streaming to promote economic development. The live streaming platforms also solved the problem of unsalable products in various places to a large extent and promoted the development of the national economy. The biggest beneficiaries were still the major live streaming platforms.

It is expected that the live streaming industry will usher in a better opportunity for development after 2020. During this period, Douyu Live only needs to follow the development trend of the industry. With the support of the major shareholders behind it, it will definitely be one of the pioneers in the industry.