Net Red Business Thriving, Inventory Of China Net Red Revenue Source

Editor's Note:

In recent years, net red business is thriving, and a large number of Chinese and overseas young people have invested time and energy to create their own social channels.

So what is the difference between China and the West's net red economy? How big is the difference in price? This article is from our content partner, Walkthechat, following the first page of the red income source - the United States, today on China's current situation.

The source of income of China net red

1. cooperation with brands

Compared to foreign countries, brand promotion is very important in China's net red ecosystem.

The following two key factors are the main reasons for the differences in the red ecosystem between China and the United States.

CPC /CPM (cost per click / display cost) is not developed in China.

In the US, brands generally get very good return on investment from Google and Facebook advertising.

In China, there are no similar platform offering cards to advertise, so most of the budget is used in net red promotion.

Internet fans' acceptance of advertisements is generally higher than that of Western fans.

Overseas sponsorship Posts often arouse fans' strong opposition, but in China, fans often accept and encourage their favorite network red to release and brand cooperation.

In terms of cost, WeChat has a higher red price.

A WeChat post has a reading range of 0.5 to 1.5 yuan.

For example, WeChat's red "AfterParty" has 550 thousand fans, and the average reading volume of each post is about 32000, and the fee is about forty thousand yuan.

The average reading volume of another blogger hand account is 70 thousand, and the charge is around thirty-three thousand yuan.

In general, the average fee per reading of a WeChat post is about 1 yuan.

Trembling is more expensive, micro-blog is the cheapest, 55 times cheaper than WeChat.

But if the brand puts money on WeChat, it can get a higher return on investment.

Behind a strong KOL is usually operated by a large team and more frequently with the brand.

For example, gogoboi, a fashion blogger, charges about 50 thousand dollars (nearly 340 thousand yuan) for each ad sticker, and 15 times a month for brand cooperation.

In this way, the annual revenue from WeChat advertising is as high as 9 million yuan (nearly 60 million 940 thousand yuan).

Gogoboi's micro-blog account has nearly 10 million fans. If we add an additional $15000 (RMB 100 thousand) to each post, we will calculate about 10 times a month, which will earn US $1 million 800 thousand (nearly 12 million 190 thousand yuan) per year from micro-blog.

2. e-commerce direct sale

Although some big bloggers such as Becky Li have decided to launch their own brands, many gogoboi bloggers, for example, choose to use platforms such as LOOK.

LOOK helps bloggers / net red create their own WeChat applet store without having to worry about logistics for pporting products and handling customer services (all these are handled by the LOOK platform).

Unlike RewardStyle's business model, bloggers do not just share links: they run their own stores, choose the types of goods they want to buy, sell promotions, and sometimes participate in pricing.

For example, the small package of hemp is a popular nursery channel, and runs a hot WeChat app store with sales of over 80 million yuan per month.

Assuming that the Commission for all product sales is 30%, the annual revenue is about $4 million 300 thousand (29 million 120 thousand yuan).

3. programmed advertising

The last way of net profit is to display advertisements in their accounts.

Bloggers can choose to display automatic advertisements in their posts, and WeChat platform is allocated to about 8-10% of revenue.

We calculate an account: the average article reading volume of WeChat official account "PupuLab Pu lab" is 20 thousand.

Assuming a click through rate of 1% and a click through rate of RMB 0.5 yuan, an article will only bring 100 yuan advertising revenue.

Compared with brand cooperation, 70 thousand yuan is negligible.

In general, unlike the overseas net profit ecological mode, programmed advertising is not a long-term solution to KOL in China.

Chinese and Western comparison

For brands, investment in China net red is often better than Western Internet users.

The main drivers of this difference are:

Competition in advertising platform is reduced.

The role of KOL is better integrated with the electricity supplier.

Chinese consumers are more accustomed to seeing native advertisements in KOL's posts.

There is a larger team running accounts.

Domestic KOL tends to decentralization of income sources (WeChat advertising, micro-blog advertising, jitter, electricity providers, etc.).

Although many Western Internet companies are making efforts to make a living, the net red will soon become popular in China and will easily turn their influence into reality.

The larger the number of fans, the more profitable they are, and the opportunity to earn billions of dollars from advertising and e-commerce.

Which KOL is the ideal choice for brand?

Whether in China or overseas, brands have encountered KOL influence which is large but can not bring about actual returns.

If you want to promote your brand in the west? You may think Kim Kardashian is the best choice.

But the reality is more subtle: for example, Mr.Dombaza is a musician in San Francisco. Although there are only 28000 fans, Instagram's participation is 10 times higher than that of Kim Kardashian.

There is a similar situation in China.

Doing activities with gogoboi is a bet, because it may not be able to achieve the effect of $50000 unless it considers the long-term public interest.

By contrast, KOL cooperation with 50 thousand to 500 thousand fans often leads to a return of 3 to 8 times the cost of marketing.

Conclusion:

China's market development is also more mature than overseas because it benefits from a vibrant net red ecosystem.

And fans' strong interest in KOL's brand is beneficial to both KOL and brand: both benefit from strong demand for quality brand content.

As brands begin to take advantage of this ecosystem, they should focus on promoting sales with medium KOL. If the fans are too large, the cost of each participation rate will begin to drop (the best point is around 200 thousand fans).