Advertising campaign plus a big investment, 58 of the city really afraid of loss?

March 9, 58 with the city released 2014 annual report and Q4 earnings, business income growth, while Q4 net profit of 70% year-on-year decline. And when the quarterly operating losses.

Market costs accounted for the revenue ratio has been high in the city of 58, in the Q4 is more generous. Earnings showed that 58 of the city in the marketing and new business 58 home incubation total investment of 60.44 million U.S. dollars, close to Q4 revenue of 75.3%.

In addition, 58 O2O intensive mergers and acquisitions in the same city for half a year. Home, e generation driving, Tu-ba Rabbit, Charm 91, a bit of traffic school ... The 1 Billion dollar "special fund" has spent more than 300 million dollars.

Advertising campaign plus a big investment, 58 of the city really afraid of loss?

300 million dollars less than half a year.

March 2, 58 with the city suddenly announced the acquisition of tenants, trading in cash plus shares of the way, the amount reached 267 million U.S. dollars. At the same time proclaim two opponents to the enemy as friends.

Settled by Liang Weiping in 2007, is the leading domestic internet real estate information service platform. In the second-hand housing business with 58 of the city there is fierce competition.

58 together with the city will rely on the acquisition of tenants to set up a real estate business group to integrate the two sides overlap business, and into the new house has never been involved in the market.

The dream of a tenant's listing has been broken several times. In the August 2010, in the context of China's real estate regulation, the tenants announced the postponement of the IPO. Went through a storm last year. March 2014, the home of the chain, I love my home, treasure original real estate, Tak Woo real estate, such as Beijing and Shanghai, a number of large intermediary agencies to boycott the price increase.

The incident has had a huge impact on the company, which is seeking to list in the U.S., and one of the reasons for its 58-city sale. "The new 58 will not be in opposition to the intermediary, we will continue to adhere to the direction of the platform, will not do transactions, not to hire their own brokers to do intermediary companies." "Liang Weiping, CEO of the settlement, said at the takeover Conference.

After throwing heavily into the house, 58 of the city began to build "the first housing platform," but has not yet reached peace and calm.

At the same time, the chain of mergers and acquisitions of Shanghai's second-largest real estate brokerage company, the news that the two were in the current boycott of the intermediary list of tenants. Prior to that, the chain in February also mergers and acquisitions of Chengdu's largest second-hand housing intermediary Yi Cheng Real estate.

Obviously the chain is also building their own O2O platform, and "deeper": The owner of the offline stores, but also directly related to the payment link. Chain Home Online CEO Peng Yongdong to reporters explaining the difference with 58 of tenants, said: If the data is online, a lot of information after the line is not clear, it is difficult to get more quality real data.

Eating a tenant is only one of the 58 recent acquisitions in the city. March 10, decorate the website of the rabbit to complete the C round of financing, 58 with the city as an investor to participate in it, pay 34 million dollars in cash and various resources.

According to the disclosure of public information, 58 with the city also in 2014, 2015 has acquired a driving O2O company e generation driving, vertical recruitment website Charm 91, as well as driving test software, such as a little pass.

Reporters according to the above publicly disclosed investment case is not complete statistics, up to now, 58 total investment amount has exceeded 300 million U.S. dollars.

Large revenue and Tencent drainage effect

In the 2014, Yiu Jingbo had a stake in Tencent's 58 shares in the city after the rhetoric: three years spent 1 billion U.S. dollars for investment in mergers and acquisitions to expand market share. Focus on the entrepreneurial companies that subdivide the category.

Last year's annual report showed that the company's cash, cash equivalents, short-term deposits and short-term investments amounted to $609 million as at December 31, 2014.

After the acquisition of an Yiu Jingbo, the company announced that it had set up five innovative business and business groups outside the classified information business group, which had been running for 10 years, and began to dabble in new cars.

Unwilling to do only a classified information display site, 58 with the city is the vertical field of deep ploughing.

Can be so "capricious" accelerated expansion, to a certain extent, depends on the internet giant Tencent's timely endorsement. July 2014, Tencent to 736 million U.S. dollars to obtain 58 of the city 19.9% of the shares, bid more than the investment sogou 448 million dollars, a stake in Beijing east of 215 million U.S. dollars. In the third quarter of last year, Tencent increased its holdings to 25%.

In addition, according to the reporter understand both products in the continuous access, QQ, mobile phone QQ and mobile phone browser diversion to 58, in particular, Tencent's cross-terminal advertising platform wide point to 58 with the city open, so that 58 pay users can be in the Tencent related products ads.

The effect of Tencent's drainage began to show, in the 4 quarter of 2014, 58 paid clients exceeded 1 million and paid more than 600,000 members. At the same time, the mobile end of the flow rate reached 66%, the same period last year, the number is only 46%.

In the 2014 annual report and the 2014 Q4 earnings, 58 of the city proudly announced that "online revenue for the first time higher than member income, the income model tends to benign development." Last year's four quarter member income was 39.8 million U.S. dollars, an increase of 53% year-on-year, online promotion revenue of 40.3 million U.S. dollars, a surge of 113.2%.

These two revenues directly led to 58 of the city's beautiful earnings: 2014 total revenue of 265 million U.S. dollars, compared to the previous year's growth 81.8%;q4 revenue to achieve 80.22 million U.S. dollars, the growth rate of 77.2%.

58 Home Hatch Drag Performance

At the same time, 58 of the city's net profit fell by as much as 70% in the fourth quarter of last year. And there are 5.3 million of dollars in operating losses. Earnings showed that 58 of the city in the marketing and new business 58 home incubation total investment of 60.44 million U.S. dollars, close to Q4 revenue of 75.3%.

58 the city's market costs accounted for the revenue ratio has been high. For example, sales and market costs accounted for up to 68% of revenues in 2014. Advertising investment of 73.4 million U.S. dollars (total revenue of 265 million U.S. dollars). That is to say, each spend 1 yuan of advertising, the corresponding gain of more than 3 yuan income, or every 3 yuan income, there will be 1 yuan in advertising.

How much does the advertisement for the classification information website user pull the function? NET CEO Yang Hao-hu described a scene: "The two or three-line city and rural young people holding 699, 799 yuan of mobile phones, see ads said market can find work, will go to download the use." He said the online recruiting business grew 1.6 times-fold last year, thanks to a dramatic shift in user behavior in the mobile era.

Hit the 58 home is 58 of the O2O project, app last November on the line, to provide cleaning, moving, the United States a hot online payment and door-to-door service, Challenge Beaver home, e cleaning and other companies. Yiu Jingbo is regarded as an important growth point in the future.

Wanguo's research report late last year pointed out that 58 increased investment in brand advertising, sales team expansion, mobile-side promotion, and O2O and research and development teams to deal with aggressive marketing efforts by rivals. It is expected that the company will continue to record operating losses in the next two quarters. At the same time, China Merchants Securities are also expected to net with the advertising campaign and 58 home promotion will lead to 58 of the city in 2015 years of loss.

Yiu Jingbo said short-term fancy is not profit, he has said that 1 billion of dollars will be focused on the classification of the start-up companies, from car rental to marriage, decoration, find a house, find a job, buy a pet dog, buy used cars.

O2O services can also be "platform-take-all"?

With the Beaver family, Cloud home economics, e car washing and other O2O has announced the financing news, door-to-door service market became unusually lively, 58 with the city, net and so also eager to enter the agitation.

But whether the future big companies can achieve a platform-wide situation, still unknown.

E Car Wash CEO Zhang to Beijing News reporter said, 58 with the city, net have been to talk to him, but after consideration or no choice immediately settled. "Large platform traffic is not very important to us, the current online traffic accounted for only 2%, most of the more accurate flow from the offline store." ”

E car wash just announced the completion of the 20 million dollar a round of peace venture financing, from car wash into the car after the service market. At this stage of the company focused on product development, this resource is relatively scarce, no attention to platform cooperation.

At present, the market has by virtue of the acquisition of business online market easy to wash car app,58 has not yet launched similar services.

"For the Electronic Business platform to provide customized goods, traffic is the key, but the key to O2O is service." Big companies do heavy vertical things hard, a company and department to fight, basically will be a company to win. Believe that for us, the same is true of other vertical areas. "Zhang said.

Industry insiders told reporters that the greatest value of the door is to facilitate and to mediate, the ills may lie in management, certification, service standardization issues and the security issues involved in home.