Top of the Great Era

Chapter 3089 Viscosity

Helo is currently the app with the largest number of users in the world, with more than 8 million users, more than 4.5 million daily active users, and hundreds of billions of messages sent every day.

Behind this are huge operating costs.

In the past year, Helo's operating costs were $20 billion. As more and more users and more functions are added, the operating expenses will only increase.

Such high operating costs actually involve great risks.

Even Boss Ma noticed it.

The current social advertising model has huge hidden dangers, and it is not as long-term and stable as e-commerce advertising. In summary, Helo's current business model has great hidden dangers. It is unlikely to suffer operating losses. No matter how bad social advertising is, it can still make money.

The United States is an advertising superpower.

  As early as the 3000s and s, some media people were panicking because the commercial mechanism of advertising would lead to an era of entertainment to death. Now in the United States, the total size of the advertising market has reached billion US dollars!

That's equivalent to every American, with business owners spending an average of $1000 on advertising on them each year.

Half of these ads are Internet ads.

Therefore, no matter how many hidden dangers social advertising has, it is impossible for Helo to fall into losses.

Especially now that Helo Moments is becoming more and more popular, it is naturally more and more favored by advertisers. Even if the industry declines in the future and App promotion ads, which play a core role in the social advertising market, plummet, Helo's ability to make money is still guaranteed, and advertising fees of tens of billions or hundreds of billions of dollars are not a problem.

The problem is that the model that relies solely on social advertising is a bit too single.

Especially here is different from China.

Helo has many competitors, and many fun and interesting social apps are constantly emerging.

We must be even more cautious in this regard.

Helo is now walking on one leg.

This is a strategic risk.

Just like Tik Tok.

In fact, Alibaba has always been the largest advertiser in China until TikTok completed the transformation from quantitative change to qualitative change.

The original Tik Tok was a social product with huge traffic, and all its profits came from social advertising.

That's a bit disappointing.

When it comes to advertising revenue, let alone Alibaba, it can’t even compare with Penguin.

Later, Douyin upgraded its strategy from walking on one leg to walking on two legs, and successfully developed e-commerce business, which allowed Douyin to have e-commerce advertising while having social advertising. E-commerce advertising is a qualitative change, and it is the key for Douyin to surpass Penguin and Alibaba and become the largest advertiser in China.

It’s a bit inappropriate to do e-commerce advertising on Helo.

There needs to be a new breakthrough.

Zhou Buqi called Lu Qi, Tang Binchen and Kurian to his office, and they had a small discussion to see whether Kurian's payment idea was reliable.

When it comes to paid products, Zhou Buqi has little say.

Including Tang Binchen, Lu Qi, as well as domestic people like Zhang Yiming, Guo Pengfei, Liang Rubo, Wang Xiaochuan, and Fu Hongliang, all of them have made their way up by following Boss Zhou, and they all use the free model and are involved in the traffic business.

Although both are Internet products, free products and paid products have completely different underlying logic.

Netflix is ​​a paid product.

Netflix's model is easy to understand, as it relies on exclusive and monopolized copyright resources. However, paid software is a completely different concept. In the field of paid products, Zhou Buqi dare not say that he is the chief product manager. Kurian is the chief expert. Many of Ziwei Cloud's products, including network disk, notes, account books, cloud video, intranet, online store templates, etc., are all paid products.

Kurian had just been appointed as the executive director, and he was feeling quite proud and in a very good mood. Before he even sat down, he got straight to the point and said, "I'm not saying that we should turn Helo into a paid product, but that we should start paying services for different businesses." Zhou Buqi encouraged him and said with a smile, "Just tell me what you think!"

Kurian said: "In some mainstream countries, users' habits of using social products have been established. For example, China is WeChat, South Korea is KakaoTalk, Japan is the Japanese version of Helo, Russia is Telegram, and Thailand is Viber. Once user habits are established, it is too difficult to change them."

Tang Binchen said: "Indeed, we need better product services and product innovation."

"Uh... not necessarily." Kurian disagreed. "Helo does need further innovation and services, but it may not be able to change the usage habits of some countries. I haven't seen detailed data on Helo's global business. You only gave me data on South Korea."

Tang Binchen nodded, "South Korea's data is the most representative."

Kurian said: "Yes, it is South Korea. We can see some clues from the Korean market. In the past year, Helo's activity in South Korea has been decreasing, and its revenue has also decreased."

Tang Binchen said: "Well, more and more Koreans are choosing the local KakaoTalk."

Kurian said solemnly: "Once competitors appear, this is a trend, and it is also the biggest drawback of free products. The loyalty of free products is too poor. What about Russia? What's the situation there?"

Tang Binchen said: "Russia's data is growing, but this is related to the fact that Russia's mobile Internet market is still in a period of rapid growth. It is not as developed as South Korea, and the popularity of smartphones and mobile Internet will be 2-3 years slower, and it is far from saturation."

Kurian said decisively: "That means within 2-3 years, the number of Helo users in Russia can still grow. But what about two or three years later? Because of some complex international factors, I believe Telegram will be the most popular communication product among Russians. Once Russia's mobile Internet market enters a mature stage, and there is still a competitor like Telegram in the market, Helo users will inevitably decrease."

Zhou Buqi nodded and said, "Over the past few years, we have achieved great success relying on the free model. However, there is no perfect model. The free model has many advantages, but it also has disadvantages."

Kurian said: "Poor viscosity is the biggest disadvantage."

Zhou Buqi concluded: "Free products are promoted quickly but have poor stickiness. Paid products are promoted slowly but have strong stickiness."

Kurian echoed the compliment: "Very good."

Lu Qi paused and said slowly, "Many of our paid products are actually different from traditional paid software. We are paid products on the Internet, and we adopt the 'free + paid' model. We promote them for free, and then launch appropriate paid services after the promotion, and improve user loyalty through paid services."

Kurian didn't need to flatter him, and said solemnly: "It is true. The 'free + paid' Internet model is indeed more competitive than traditional paid software in the market. But the disadvantage of poor user stickiness is also obvious. Let me give you an example, such as our online disk business."

"you say!"

"Our cloud storage EverDrive is the most successful SaaS product in the world. It has more than 3.8 million users worldwide and more than 7000 million paying users. The annual membership fee income exceeds 50 billion US dollars. After Nadella took office as Microsoft's CEO, he quickly made a series of changes, the biggest of which was their Microsoft Cloud Drive."

"Is it a threat to us?"

Zhou Buqi really didn't take Microsoft's OneDrive seriously, because he had never heard of it in his previous life. If Microsoft's OneDrive really became popular, it would have been known to him a long time ago.

Kurian said: "There is a certain threat, but it is not serious. The core is that we are a paid product. Microsoft Cloud Drive has launched a series of very competitive package services with very competitive prices. But what is the result? Our EverDrive paid users have not been lost, and even increased by 820 million in the past six months. On the contrary, the activeness of free users has decreased, probably because they were attracted away by Microsoft Cloud Drive. This case is very representative."

Zhou Buqi nodded solemnly, "Indeed!"

Microsoft's online storage OneDrive has launched some competitive packages, which means that the prices may be lower than its own online storage EverDrive.

However, EverDrive's paying users have not been lost.

On the contrary, many free users of EverDrive have gone to Microsoft.

You know, they are free users!

Microsoft's package prices are low, but they only apply to paying users and have nothing to do with free users.

What actually happened was very abnormal. None of the paying users left, but a lot of free users left.

Lu Qi said: "This is actually a mentality of yearning for expected space. Free users have a larger expected space, so they are willing to choose more affordable products; paid users, because they have already paid, the expected space is saturated, so they will be more loyal."

Zhou Buqi agreed with this. He had a lot of experience. "Well, it's just like finding a partner."

(End of this chapter)