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Chapter 414 0404 [Using a New Business Model to Achieve a Disruptive Strike]

Sina has a wealth of media resources, and its portal and blogs drive traffic to Sina Weibo.

But ByteDance isn't going to back down either.

HaiNei.com has nearly 9000 million registered users, of which about 4000 million are monthly active users.

Renren.com has over 1500 million registered users and over 800 million monthly active users—most of the inactive accounts are users who have already graduated and are now active on HaiNei.com.

There are also Happy Market and Zhihu, which have been left to their own devices.

These websites can all drive traffic to ByteDance's Weibo account.

Sina can mobilize a bunch of websites that have invested in it, and Chen Guiliang can certainly mobilize Tudou.com, Xiami Music, and ZBJ.com as well.

Xiami Music, in particular, has long had a deep partnership with ByteDance's overseas WAP site, and its customized playlists can fully interact with ByteDance's Weibo.

In addition, by offering incentive packages, ByteDance's Weibo platform achieved viral expansion, yielding remarkable results in just a few days.

The two sides launched a propaganda offensive for half a month, and even a fool could see the tension between them.

……

In the Weibo war between ByteDance and Sina, Tencent was the first to announce its defeat.

Tencent's current microblogging product is called Taotao, and its content highly overlaps with QQ Space's wap site.

Seeing that it couldn't compete with the situation, Tencent shut down Weibo (Taotao) and integrated its resources into the QQ Space wap version.

Tencent is making a strategic shift, focusing its full efforts on developing QQ Zone.

They also launched "Mood" (the predecessor of "Shuoshuo") on QQ Space, using "Mood" to encompass the early microblogging function.

It must be said that this was a major mistake by Tencent.

Tencent believed that QQ Mood had a microblogging function, so it was essentially continuing to develop microblogging, and it could also leverage the massive user base of QQ Zone to its advantage.

But this is equivalent to creating a microblogging platform within QQ Space; the ecosystem is completely closed and cannot be expanded further.

Once Tencent realizes this, it will definitely launch Tencent Weibo.

The WAP site of HaiNei.com has highly overlapping content with ByteDance's Weibo. Integration is currently underway, with all Weibo-related functions being removed. HaiNei.com WAP site users who switch to ByteDance's Weibo can use it for free for three months (ByteDance will cover the Weibo subscription fee).

……

While Sina Weibo was busy recruiting celebrities and promoting itself, Chen Guiliang was already moving on to the next step.

Hangcheng.

Chen Guiliang flew in personally to meet Jack Ma; this was their first private meeting.

"Mr. Ma, hello."

"Please have a seat, Mr. Chen. Coffee or tea?"

"Tea."

Alibaba is in a bad situation this year.

Although Taobao has grown rapidly, its B2B business (Alibaba.com) has been severely impacted by the financial crisis, which caused China's foreign trade to shrink.

Ironically, the main entity behind Alibaba's IPO is its B2B business.

Even at this critical juncture, Jemark defied public opinion and decided to invest heavily in cloud computing research and development. Shareholders were extremely puzzled and even questioned him at the shareholders' meeting, which Jemark painstakingly managed to convince them of.

"The battle between ByteDance and Sina Weibo is really exciting; I've been following it closely lately," Jack Ma said.

Chen Guiliang made a startling statement: "This Weibo war is actually related to Taobao as well."

Jack Ma laughed and said, "Alibaba doesn't use Weibo."

Chen Guiliang said, "But ByteDance Weibo can help Taobao sell products."

Jack Ma immediately became interested: "How much?"

Chen Guiliang said, "ByteDance's Weibo has a large number of celebrities, especially internet celebrities. They have a lot of traffic, but it's difficult for them to monetize it. So, could Taobao stores or brands hire internet celebrities to advertise on Weibo?"

Jack Ma pondered carefully: "It seems like this is one way to do it."

Chen Guiliang continued, "TV advertising is expensive, and website advertising isn't cheap either. And there's no guarantee of results. If you hire an internet celebrity to advertise, you can get a Weibo post for just a few thousand yuan. It's not only cheaper, but it also directly reaches consumers. The internet celebrity delivers the advertising content directly to their followers, which is very persuasive!"

A Pandora's box is about to be opened by Chen Guiliang.

It's still just a product-selling model driven by online influencers.

It's estimated that once Chen Guiliang opens up new avenues of thought, micro-businesses will naturally emerge before long.

Of course, he also has a bottom line: he prohibits the promotion of medicines on ByteDance's Weibo account.

While advertisements for health supplements are permitted, they are subject to strict scrutiny and cannot claim any "therapeutic effects." Claims of curing all diseases or having specific effects on a particular ailment are completely prohibited.

Don't those celebrities try to avoid offending anyone? They have accounts on multiple Weibo accounts at the same time.

Okay, I'll give you benefits so you can make money on ByteDance Weibo!

Chen Guiliang added, "While I was in Beijing, I had already reached a cooperation agreement with Dangdang.com. Mr. Liu from JD.com is unavailable these days, so we've arranged to meet next week."

Other e-commerce platforms all need to cooperate with ByteDance, so Taobao certainly can't be left behind.

Jack Ma asked, "Mr. Chen, could you elaborate on the details of the cooperation?"

Chen Guiliang said, "Taobao has opened an API interface with ByteDance to facilitate data tracking and settlement. Weibo influencers can register as promoters on Alibaba's Alimama platform to obtain their exclusive promotion PID. Weibo influencers use Alimama tools to generate exclusive promotion links for products... If the above cooperation methods are technically difficult, then we will use the original method. Influencers will specify the search store name or product name on Weibo, along with keywords agreed upon by the influencer and their fans."

“ByteDance Weibo will also establish an intermediary page within the platform, where brands or Taobao sellers can post promotional tasks. Influencers can then search for task quotes, and ByteDance Weibo will collect a commission from the platform. However, the review process for this model will be very strict. Not only will it not touch pharmaceutical advertisements, but it will also be difficult for health products to pass the review unless they can provide complete and legal documentation.”

"Regardless of the model, ByteDance and Taobao need to work together to promote it. They need to cooperate on technology and operations."

"If we want to deepen our cooperation in the future, we can also provide each other with more detailed data dashboards. For example, when Taobao organizes large-scale events, ByteDance and Weibo will also cooperate."

Jack was completely engrossed in listening.

This collaboration model is pretty impressive. Moreover, Chen Guiliang seems to have already explored a completely new business model for Weibo.

"We can sign a letter of intent now, but I need to discuss the specifics of the cooperation in a meeting." Jemark is decisive and efficient.

Chen Guiliang said, "Within a year, Taobao can only cooperate exclusively with ByteDance in the field of microblogging products."

“Well…” Jemark hesitated, as he wanted to collaborate with multiple Weibo accounts.

Chen Guiliang said, "ByteDance's Weibo has been promoting itself recently, and its registered users are approaching 1600 million. Sina Weibo, which ranks second, has just over 300 million registered users despite its massive promotion. Taobao has a choice: either to cooperate exclusively with ByteDance or to cooperate with other Weibo platforms. The combined registered users of the other 30-plus Weibo platforms don't even match ByteDance's!"

Jack Ma is a strong-willed person.

At this moment, Chen Guiliang was more assertive than him, directly giving Jack Ma a choice.

Jack Ma said, "I need to have another meeting to discuss this."

“Okay, I need to fly back to see Mr. Liu from JD.com.” Chen Guiliang stood up and shook hands.

Jack Ma smiled broadly: "Mr. Chen, won't you stay for a meal? You've come all this way to Hangzhou, so I should at least show you the hospitality of a local."

Chen Guiliang said, "Next time. Let's have a drink and chat after we've finalized our cooperation."

Chen Guiliang had to be so ruthless, forcing Taobao to have an exclusive partnership with ByteDance's Weibo (within one year).

"I'll see Mr. Chen off," Jack Ma said politely.

……

Chen Guiliang and Liu Qiangdong arranged to meet, not only to discuss business cooperation, but also to try to talk about investment.

Earlier this year, JD.com almost went bankrupt because it was running out of money.

Its Series A shareholders helped bring in venture capital, enabling JD.com to secure $2100 million in Series B funding.

But this money won't last long; it'll probably be gone within a year!
Because building your own warehousing and logistics system is too expensive.

However, once completed, it will be like building a high barrier that no competitor can easily breach. If JD.com were to suddenly collapse one day, it certainly wouldn't be due to external threats, but rather to internal problems.

"Boss, Mr. Chen is here."

"Invite him in."

Liu Qiangdong looked exhausted. He had just returned from out of town and personally guided the establishment of two warehouse sites.

They raised $21 million in January, but by then 70% had already been burned.

The rate at which cash was being burned far exceeded Liu Qiangdong's expectations, forcing him to slow down development and tighten his belt for the second half of the year. He would wait until a venture capital firm was willing to invest in his Series C round.

Two years ago, given JD.com's growth trajectory, venture capitalists would have already sensed the impending doom.

But we're still in the midst of an economic crisis!

For example, Tiger Global Management, which will invest heavily in its Series C funding round next year, is currently mired in the financial crisis. Would it really invest in JD.com? It's too busy dealing with its own portfolio issues and investor redemptions to manage the situation.

The situation is similar for other venture capital firms.

Even when AutoNavi's Series A shareholders sold their existing shares—a windfall opportunity—Chen Guiliang managed to get a share. IDG's Xiong Xiaoge specifically called Chen Guiliang because IDG and other venture capital firms couldn't handle that much.

"Mr. Liu, it's a pleasure to meet you."

"I've long admired your name, Mr. Chen. Please have a seat."

In 2009, Dongzi hadn't gained weight yet and was a very energetic young man.

The dark circles under the eyes are very heavy; I guess they haven't had much rest.

Chen Guiliang repeated the same story he had told Ma Jieke to Liu Qiangdong.

Liu Qiangdong agreed without much thought, because his situation was much worse than Taobao's, and he urgently needed new channels for promotion and marketing—JD.com was in a fierce battle with Gome and Suning.

Exclusive partnership it is, anyway, ByteDance Weibo is the most powerful right now, and Liu Qiangdong is very satisfied with this cooperation plan.

Chen Guiliang suddenly asked, "Is JD.com short of money?"

"what?"

Dongzi was taken aback, but then insisted, "We don't lack money."

Chen Guiliang laughed and said, "But the media all say that JD.com is short of money, and that your idea of ​​building your own warehousing and logistics system is wishful thinking. In the end, you will definitely burn money and burn yourself out."

Liu Qiangdong said, "JD.com's business has developed very rapidly in the past few months."

“But we suffered huge losses,” Chen Guiliang said.

Liu Qiangdong's expression was very unpleasant: "This is our own business, President Chen doesn't need to worry about it."

"I'm planning to invest," Chen Guiliang said. "In the Series B round in January. If I invest now, it's not exactly Series C, it should be called the Series B extension round."

Liu Qiangdong was overjoyed: "You're really willing to invest?"

Chen Guiliang said, "I can invest. But I can't accept an excessively high valuation."

If Chen Guiliang had participated in the Series B funding round in January, he would have made a fortune.

However, the reborn are not omniscient or omnipotent, and JD.com did a good job of keeping it a secret. Chen Guiliang only learned about the news more than a month after the B round ended.

It’s not too late now.

JD.com's A and B round shareholders are currently scrambling to secure investment for Dongzi, fearing that JD.com will go bankrupt if it burns through all its money.

But they couldn't attract venture capital at all.

First, the economic crisis has had an impact; second, JD.com's asset-heavy model has made investors very cautious.

Liu Qiangdong asked, "How much does Mr. Chen plan to invest?"

"It depends on JD.com's valuation and how much you're willing to let me invest. Like I said before, if the valuation is significantly higher than the Series B round, I'll just walk away. You should discuss it with the shareholders," Chen Guiliang said.

(End of this chapter)