58 of the same city hovering over the edge of the cliff

Recently, Chengdu Ants moved Jinan branch 58 with the city of Jinan branch to court, the reason is less than 58 of the city released false ants move information. Although the lawsuit is still not pronounced, but 58 of the city of false fraud information rampant contradictions have erupted.

The investment community's skepticism came after 58 of the city's first earnings forecasts fell to a 30-dollar interval. Now the move of the ant to sue, once again proved that 58 of the city after the IPO is not out of the business model of the huge crisis.

From earnings to see 58 of the city's worries

This year's Q3 quarterly results showed that 58 of the same city to achieve total revenue of 41.6 million U.S. dollars, an increase of 77.6%, gross profit margin of 94.5%, net profit of 8.5 million U.S. dollars, the same period last year, the loss of 6.3 million U.S. dollars. Apply 58 to the city's official rhetoric, which has been profitable for the second consecutive quarter since its two-quarter profit.

In terms of revenue, 24.2 million dollars comes from membership fees, 17.1 million dollars from online extension service revenue, and 300,000 dollars for other service revenue. Only from these figures, this can be said to be a very beautiful report, because 2012 year 58 of the city's revenue but 87.12 million dollars.

Even with the data very beautiful, Citigroup's initial rating of 58 shares in the city was bought, but the stock price was still a hard 10%. Clearly, capital is not bullish on 58 of the city's earnings.

Look at the 58 in the city 2011 years and 2012 earnings will find that 58 of the city can achieve profitability, is the result of the compression of marketing costs. According to the prospectus, the total operating expenses for three years in the 2010 years of the same city were 22.2 million US dollars, 11.86 million dollars and 10.79 million dollars respectively. Advertising spending is 8.23 million U.S. dollars, 68.51 million U.S. dollars, 25.06 million U.S. dollars, accounting for the proportion of revenue 76.9%, 164.9%, 28.8% respectively. It is not difficult to see that 58 of the city's profits, is a substantial compression of advertising and operating costs of the results.

In fact, the capital of 58 of the city's query, not only the profits on the prospectus, but more on the 58 of the city's weak growth judgment. 58 with City month independent 130 million, active merchant 4 million. Cnnic released the latest data shows that 591 million of the domestic netizens, which means that 1 of 5 netizens will log in at least 58 in one months. According to the industry's algorithm, 58 of the same city user dividend has dried up, user size growth has reached the limit.

In the case of user growth reaching the limit, active merchant growth is bound to be affected. In 58 of the city's revenue, the merchant contributed more than half of the membership income. It is clear that capital does not have sufficient confidence in the future growth of income in the city of 58, which at the same time implies a crisis of 58 business models in the same city.

58 another difficult choice for the city

The root of the problem is that the capital is questioning 58 of the city, or because of the drawbacks of existing business models.

58 The business model of the city is composed of three parts, one is the member authentication service, the other is the value-added service represented by the information of the top price and the bidding rank; three is the advertisement, at present the charge of click. 58 with the city CEO Yiu Jingbo revealed that now membership income accounted for about 50% of total income, value-added charges about 30%, the rest is advertising revenue. According to 58 with the city's senior vice President Xiaohua revealed figures, now 58 with the city in the country has a hundred thousand of paid members.

Theoretically, 58 of the city's existing business model is established. In practice, however, the 58-city business model makes a fatal mistake: ignoring the user experience. As a result of the pursuit of the number of paid merchants, the lack of management of the qualifications of paid merchants, resulting in a large number of false fraud information flooded, seriously affecting the user experience.

Real estate is 58 of the advantages of the city business, a lot of second-hand housing intermediary is 58 of the city's paid members. In the extensive management mode, 3 sets of housing may appear 10 or more, and the release of the message of the merchant as many as 10, real looking at the house only found only 1 houses. A similar situation has not only appeared in a separate station in the 58 city, but has become a common problem.

In the recruitment field, some insurance companies disguised as other companies in the 58 of the city to release recruitment information, triggering the user's strong dissatisfaction. Because of this, 58 with the city in the eyes of users become a low-end, chaotic classification information site. In the future, if 58 with the city let false fraud information rampant development, membership certification, value-added services these business models will collapse. Just imagine, the user fled, the merchant released the information Nobody, the merchant nature will not be willing to pay again.

Obviously, the 58 city faces a difficult choice, to the user experience, or to benefit. In fact, the 58 city has another option, through the optimization of the flow of information, for merchants and users to provide more convenient access. Unfortunately, after the Q3 quarterly results released this year, 58 of the same city CEO Yiu Jingbo shouted to the mobile Internet, the slogan of advancing the user experience was put aside.

How to improve the user experience, improve the rate of conversion, 58 city and Yiu Jingbo face another difficult choice. During the previous years ' development, 58 of the city experienced many choices. The difference is that the choice is after the success of the IPO, in the eyes of the capital, the pressure can be imagined, into the mobile internet will undoubtedly tell a good story.

Mobile field is not 58 the same city position

Indeed, 4G license issuance makes the mobile Internet field a new growth point, 58 of the city will be strategic focus on the mobile client tilt is understandable. But, in the vertical manufacturer preconceived pattern, the mobile domain terror is not 58 the same city position.

58 the same city in the field of classified information has two major advantages of business, one is second-hand housing, the second is recruitment. In the field of property classification information, Vertical property search house and the advantages of the tenants have been quite large. In the mobile client, the tenant integrates the second-hand housing, new house and other resources, and help users find the latest listings by using LBS. In addition, the app also introduced the evaluation system, to the second-hand housing brokers evaluation to eliminate false information and false intermediary. Search rooms, also have full-featured app. Imagine, in the search house and the fierce competition between the tenants, 58 of the city's killer is what?

Not to be overlooked is that the housing tenants and search houses have been involved in the field of property for many years, has a wealth of experience and customers, this is 58 of the city do not have. In addition, the search room and tenants began to layout mobile clients 2 years ago, 58 of the city to go beyond the difficulty imaginable.

Look at the recruitment of this area, 58 with the city still face worry, Zhaopin such a strong competitor. Although 58 of the potential users of the city recruitment is grassroots users, and worry such vertical recruitment site is the user base of middle and high-end users. But let us not ignore the point, the Mobile client's customer group itself is middle and high-end users, low end users. Therefore, 58 of the same city recruitment in the mobile client's survival space is very small.

Whether it's real estate or hiring, 58 of the city's advantages in the mobile sector are not obvious. Not only face the strong opponents in the vertical field, but also face the awkward situation of lack of experience. Objectively speaking, the foreground of mobile internet is good, but the prospect of classified information is not so beautiful. In the next 2-3 years, the mobile domain may not have 58 of the same city position, enter the mobile end of 58 with the city is not a wise choice, is not a breakthrough direction.

Although the classified information industry has experienced many years of development, but the clear profit model has not yet formed. Whether it is 58 with the city, or the market, are groping in the forward. 58 The success of the city, thanks to the support of users. After the user experience conflict erupted and rose to the litigation level, the 58 city still ignores the user experience, that hovering over the edge of the cliff 58 with the city at any time may fall to death. And the status quo of the city of 58, it is also worth net and Bai these peers to ponder.

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