Why did Toutiao become the target of BAT's encirclement again after escaping from the trap?

The Chinese Internet industry has been dominated by the three giants BAT for more than a decade. With the emergence of mobile Internet, big data, artificial intelligence and other technological changes, many new forces have emerged in the Chinese Internet, and Toutiao is definitely one of them. In particular, as content has become a guarantee of traffic, BAT has also begun to worry, but the strong content layout has not prevented Toutiao from escaping.

BAT also starts to worry about controlling the content entrance

The Internet is flooded with information. How can we find the content we like in this era of information explosion? In the past, we searched and subscribed to content. Now, we use artificial intelligence technology to provide users with accurate push notifications, which not only meets users' content needs, but also contributes to the value of Toutiao.

Toutiao was not initially favored by the industry and was no different from other content aggregation platforms. This also caused portal giants and BAT, which were making large acquisitions everywhere, to relax their vigilance. However, with the surge in the number of users, it was already too late for the giants to catch up.

Today, the content aggregation platform includes Toutiao, Tencent's Tiantian Kuaibao, Xiaomi's Yidian Zixun, Alibaba's UC and Weibo, etc. In the 2016 ranking of news and information apps by Cheetah Global Think Tank, Toutiao ranked first with a weekly active penetration rate of 13%, and Tencent News, Tiantian Kuaibao and Yidian Zixun ranked second to fourth.

The value of Toutiao is reflected in its market valuation. Recently, several media outlets reported that Toutiao had received $1 billion in Series D financing from Sequoia Capital, CCB International and other investment institutions at the end of last year. After the completion of the Series D financing, its current valuation has exceeded $11 billion. In nearly two and a half years, Toutiao's valuation has increased 24 times.

On the other hand, Toutiao embodies the power of technology to drive industrial change. With the exploration of big data and artificial intelligence, it has promoted the transformation of China's news media industry and the era of content change. In particular, content has become the source of Internet traffic. Although the four major portals have followed Toutiao, they are still in danger of being overthrown. BAT has no choice but to suppress Toutiao.

According to data released by QuestMobile, in 2016, there were two comprehensive information apps with MAU (monthly active users) exceeding 100 million, one is Tencent News, and the other is Toutiao. In terms of total user stay time, Toutiao has surpassed Tencent News, and its growth momentum is rapid. It should be noted that China's mobile users have exceeded 1.02 billion, the demographic dividend has basically disappeared, and the industry replacement trend is very obvious.

No wonder Feng Xin, CEO of Baofeng, admires Toutiao so much. Baofeng Sports' goal is to become the "Toutiao of the sports industry" and let Baofeng Sports learn Toutiao in depth. In his opinion, the most powerful part of Toutiao is its user big data, which can push content of interest to each user. It is truly personalized and you can get new content you like with just a few clicks.

The user stickiness and reading time of Toutiao are constantly improving. In terms of user time, Toutiao has now achieved an average daily usage time of 76 minutes per user. Compared with WeChat, 50% of WeChat users use WeChat for 90 minutes a day, and the gap between the two is narrowing.

The short video competition among giants cannot be missed

After graphic content, the short video war is about to begin. A positive signal for short videos is that the playback time of short videos on Toutiao has allegedly exceeded that of traditional long video websites, and thus, the transformation of the video industry has quietly arrived.

From the perspective of market investment, Deng Feng, founder of Northern Light Venture Capital, mentioned, "Whether it is UGC, PGC, or social networking, there are huge opportunities this year. China still does not have its own YouTube." Obviously, short videos have become a battleground.

In addition, as early as the beginning of last year, an insider of Toutiao revealed to the reporter of China Business Network that Toutiao’s video business has grown rapidly, and the number of readers has even caught up with pictures and pictures, becoming the largest short video platform in China. According to the figures provided by Toutiao, the average daily playback volume of Toutiao videos was 180 million in 2015, and the average daily playback volume of videos in 2016 was 1.269 billion, a year-on-year increase of 605%. Perhaps this is what the Internet giants such as BAT are very anxious about.

According to iResearch Consulting data, the number of investment events in the short video industry increased from a handful to 13 in 2014, and reached 17 in 2015. By 2016, after the market's great ups and downs, several major leading platforms such as Kuaishou, Meipai, and Miaopai emerged.

Today, Toutiao has raised $1 billion to focus on short videos and Q&A, relying on its strong user base and artificial intelligence technology. Alibaba Entertainment recently held a press conference to announce that it will launch a subsidy plan to support the creation of short video content, with cash investment expected to exceed 2 billion. In addition, Tudou will focus on short videos in the future, which is both a strategic reinforcement and a way to keep up with the future. Tencent invested a huge amount of $350 million in the short video app Kuaishou, and its market valuation has now reached 4 billion US dollars. They all see the future

Precision marketing without distraction

In the past, it was difficult to find accurate users for advertising and marketing. For marketers, they knew that half of the cost was wasted, but they didn't know where it was wasted. Compared with general advertising, precision marketing is a win-win situation for both merchants and users in terms of cost savings.

With its big data capabilities, Toutiao not only seized the mobile traffic entrance, but also made users less disgusted through precision marketing, and improved the conversion rate of advertisements. Obviously, this has had an impact on Baidu's much-criticized bidding ranking, and also brought an impact on the traffic advertising of Internet giants. In 2016, Toutiao's revenue reached 6 billion, which is astonishing.

For example, I have recently become obsessed with table tennis and planned to buy a pair of table tennis rackets, so I searched for information about table tennis rackets on JD.com. Unexpectedly, when I was reading the content of Toutiao, I received targeted advertising push notifications, which surprised me greatly.

Thinking about it carefully, it turned out to be due to JD.com's strategic cooperation with Toutiao. On September 27 last year, JD.com and Toutiao announced that they had reached a comprehensive strategic cooperation and jointly launched the "Jingtiao Plan".

According to Xu Lei, senior vice president of JD Group and head of JD Mall's marketing platform system, the "JD Toutiao Plan" mainly covers three aspects: first, JD will open a first-level shopping portal "JD Specials" on Toutiao; second, Toutiao will rely on personalized data recommendation capabilities to help JD and merchants on the JD platform achieve accurate advertising; third, the two parties will jointly carry out e-commerce cooperation based on interest reading, and help more Toutiao accounts realize monetization through shopping guides, commission sharing and other models.

From this point of view, behind any business change is a technological change. With the mature application of artificial intelligence technology, Toutiao can achieve both user value and commercial value. No wonder Toutiao's user base and reading time are constantly increasing, and its revenue is also increasing day by day. Facing the pursuit and blockade of BAT, can Toutiao once again escape? The best is yet to come.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.