A brief discussion on how to expand the micro short drama business

This article introduces how to expand the micro-short drama business, including MVP verification in the startup phase, scale-up strategy in the growth phase, and ideas for exploring the second curve in the mature phase. It emphasizes the key steps and strategies at different stages to achieve continuous growth and innovation of the business.

01 Introduction

Why write this?

1. Since I recently wrote an article analyzing AI+micro-short dramas, I have started to develop some interest in the micro-short drama industry.

2. QQ Music has always had a "micro short drama" channel, but it was recently removed. Combined with the recent news that Tencent Music has entered the short drama industry, it is possible that the micro short drama business has been carried over to "National Short Drama".

3. My wife recently took over the short drama business, and I want to help her take it over. How can she help the company’s short drama module break through the siege?

I started to think about a question, "If a company wants to expand its micro-short drama business, what should it do?" So, I started to write this article. I won't talk about what micro-short dramas are. The following content is divided into three stages: "start-up period, growth period, and maturity period".

02 MVP verification during the startup phase

The most important thing in the startup phase is to verify the MVP, that is, to verify whether the company can make short plays. Otherwise, all the subsequent steps are nonsense. So how to develop the MVP? First, you need to "find the entry point".

Find the entry point

First of all, we need to clarify where our company is located in the micro-short drama business chain so as to find the entry point.

Then I will first dismantle the current commercial chain of micro short dramas, as shown in the figure:

It is mainly divided into three parts:

1. Micro short drama production process:

This link can be divided into pre-production, mid-production and post-production.

1) Pre-production party: mainly provides script-related production support. Some short play scripts adapted from novels, comics, IP, etc., still require authorization from the copyright holder for production.

2) Mid-term producers: mainly responsible for the filming of short dramas, including but not limited to suppliers of actors, venues, equipment, costumes and props, as well as the filming team.

3) Post-production: The team mainly responsible for content including but not limited to editing, dubbing, sound effects, special effects, etc.

The front, middle and back stages may be completed by multiple teams or by the same team. This stage mainly produces the finished short drama for subsequent consumption.

2. Micro drama consumption link:

The members involved in this session are:

1) Operator: After the production of the finished product is completed, an operator is required to be responsible for monetizing the content of the short drama. This operator needs to assist in connecting with content suppliers, broadcasting platforms, customer acquisition platforms, and user groups, and complete content listing, content acquisition, user operations, monetization and other work during the connection process.

2) Broadcasting platform: The broadcast of short dramas requires a platform to carry them and provide basic video playback, payment, and reward capabilities, so as to realize the monetization of short drama content. Generally, various long video platforms and short video platforms can be listed here, such as iQiyi, Tencent, Youku, Bilibili, Douyin, and Kuaishou.

As shown in the picture, the two pictures on the left show the short dramas on Douyin, which support playback and paid unlocking. The two pictures on the right show the paid video capabilities of Bilibili, which also meet the needs of short drama playback and paid unlocking.

Many short dramas have chosen to be listed on WeChat Mini Programs, because they can also play videos and unlock them for a fee on WeChat Mini Programs. They can also make full use of the huge number of users in the WeChat ecosystem and spread them through WeChat's social network. At the same time, WeChat Mini Programs also support buying traffic from major advertising platforms to acquire customers, which can be said to be one of the most cost-effective playback platform choices.

The first picture on the left shows the short drama aggregation function provided by WeChat's "Search", which aggregates the content of various short drama mini-programs to provide a better search experience. The second picture on the right shows the short drama playback platforms provided by different manufacturers.

3) Customer acquisition platform: Micro short drama is a "content consumption" business model, where one piece of content is exchanged for one piece of revenue from one user. Therefore, in addition to continuously providing new content, it is also necessary to continuously introduce new traffic (content consumers) to different content.

Generally, the commonly used customer acquisition methods can be used to acquire customers for short dramas, so the customer acquisition platforms include but are not limited to:

i) Advertising buying platform: Place video ads on advertising channels such as Douyin, Kuaishou, WeChat, and Weibo to attract users to go to the "playing platform" to watch content and pay.

ii) Video joint operation platform: by listing on long/short video platforms such as Bilibili, Douyin, Kuaishou, and iQiyi, relying on official recommendations, rankings and other functions to obtain traffic, and making profit sharing settlements with the platforms. Generally, for short dramas that gain customers in this way, the "playing platform" is the same as the "video platform" on which they are listed.

iii) Social media operation platform: Create an official account on social media, build a persona and publish content to attract users, thereby directing traffic to the short drama works.

iv) Community operation platform: establish fan and same-account communities, maintain core users within the groups, and direct traffic to short dramas.

…

In simple terms, the operation of the micro-short drama consumption link mainly involves three roles: "operator", "broadcasting platform" and "customer acquisition platform". Of course, the above three roles can also be in charge of the same company. For example, the short dramas officially operated by Douyin are operated, broadcasted and acquired by the platform.

3. Income link:

The last part is the revenue link, which is to obtain revenue by providing short drama content to target users, and then feed back to the short drama producers, thereby stimulating the production of better content. The revenue link is generally carried out by the teams in the above two links, that is, "each collects their own money".

Common types of income include:

1) Platform revenue sharing: Based on the S, A, and B ratings of the short drama, different levels of revenue sharing are given for each effective broadcast. Generally, this revenue sharing model exists on platforms that "can obtain revenue from membership subscriptions and advertisements brought by short dramas."

2) User paid income: Users directly purchase short drama content, which in turn gives a share of the profits to the broadcasting platform, customer acquisition platform, operator, and production team.

3) Copyright purchase income: This is generally the one-time copyright purchase income obtained by the producer from the operator or broadcasting platform.

4) E-commerce sales revenue: Earn income by leveraging the short drama’s social media/community accounts to sell products. This is a monetization method that can only be used after having a certain fan base.

5) Reward income: income obtained through the reward function provided by the broadcasting platform.

6) Advertising placement revenue: revenue obtained by placing advertisements in content. This is different from advertising revenue obtained through platform sharing, as placement of advertisements requires customization of content.

…

The above is the business chain of micro-short dramas that I have sorted out. We need to think about where the company can be located in the business chain of micro-short dramas so that we can find the entry point and layout the micro-short drama business.

For example, if your company was originally an advertising filming company with certain video post-production capabilities, then you can join the "micro-short drama production link" , take some scripts, and arrange some actors to shoot micro-short dramas.

For example, if your company was originally a content APP that can carry the capabilities of a video playback platform and a customer acquisition platform, it can then connect to the "customer acquisition platform" and "playback platform" of the "micro-short drama consumption link" , access some short drama content, and supply it to its own user groups, thereby realizing monetization.

The key point in this process is to "find a point of entry that fits with the original business of the enterprise" , rather than starting from an unrealistic module. For example, if the enterprise has no filming experience, no filming talents, and lacks actors/costumes/props/scene suppliers, it is difficult to directly enter this business from the "micro-short drama production link".

Run through MVP in the entry point

After confirming the entry point, you need to conduct MVP verification at the entry point to verify the feasibility of the short drama business in your own company at the lowest cost. The feasibility verification mainly revolves around "whether it can bring profits to the team."

The MVP direction of different entry points will also be different. Let’s expand on them one by one:

1. MVP of short drama production:

We will not elaborate on the MVP of the early, mid and late stages of the team here, because the key point of the MVP in the production stage is to "create a benchmark" micro-short drama product . This work needs to be able to help downstream teams achieve profitability so that they can obtain sufficient resources for subsequent content production, thereby creating better products and obtaining higher revenues.

2. MVP of micro drama consumption link:

1) “Operator”:

The operator needs to select a suitable short drama from the vast "sea of ​​dramas", a short drama that can help the team make a profit (run MVP verification).

The cost of this drama should not be too high, because drama selection is a "gamble" to avoid losing money right from the start. At the same time, the operator needs to have a corresponding publicity and promotion plan and implementation capabilities for the drama, and estimate that it is profitable overall. For example, if a team gets a short drama that (by its own estimate) requires a million marketing costs to make a profit, for a small team, it may lack the start-up funds to ensure the implementation of the marketing plan.

2) “Playing platform”:

If it is a pure broadcasting platform, in the MVP stage, it needs to find a suitable content supplier and complete the "micro-short drama content" entry work . The micro-short dramas settled here need to be able to provide " profit sharing to cover the development costs ."

But generally speaking, the broadcasting platform also bears the responsibilities of the customer acquisition platform.

3) “Customer acquisition platform”:

Customer acquisition platforms often have a certain amount of traffic. In the MVP phase, the platform needs to select some user groups and promote short drama content to these groups. This process requires accurate matching of content with user needs, while avoiding interference with the general user group and verifying the positive benefits of the content. Because the platform does not know the user group's acceptance of short drama content, whether "aggressive promotion" will lead to "loss of original core users."

In order to ensure that the MVP phase is running smoothly, it is necessary to ensure that there is a certain amount of content supply . This part of the content should not be too expensive and should be based on the user preferences of the platform. (For example, if a male APP platform is filled with a large number of female short dramas, this will lead to user dissatisfaction and may even cause user loss.)

Then, it is necessary to accurately push the existing content on the platform to reach the target user group, so as to verify the acceptance level of the user group. In this process, the following can be done to maximize the auxiliary benefits.

i) Content classification/labeling: Based on the understanding of users and content, content is divided into dimensions such as subject matter and story type, so as to accurately reach and push content to users who are interested.

ii) Touchpoint packaging: "How the content is presented to our own user groups" determines the conversion rate of the content and how many users we can earn revenue from. The most common method is to present short drama clips, exciting content, and suspense content in the form of video ads to attract users to watch and guide them to pay attention to the subsequent plot, thereby contributing revenue to the platform in the process.

In addition, for platforms that have just entered the "micro-short drama" business, they also need to conduct appropriate "user education" to cultivate users' micro-short drama consumption habits. Because even if users are the audience of micro-short dramas, they may not watch micro-short dramas on their own platforms. For example, it was originally a forum community, and the "watch short drama" function was added to it. Users are not used to watching videos on text content platforms, so they may not watch micro-short dramas through the platform. A common user education method is to hold activities and attract users to consume micro-short drama content through some rewards.

03 Business Scaling in the Growth Stage

After running the MVP verification and obtaining a "positive" verification result, the business enters the growth stage and needs to enter the business scale stage, expand the existing business scale, and build its own barriers in the process.

Different types of teams have different scaling directions:

1. Scaling up the production of short plays:

At this stage, the short drama production team has been able to achieve stable profits. It needs to start expanding the team and empower the new team with past high-quality experience, and then start mass production of short drama content.

For them, the experience in producing high-quality content summarized in the past is their "competitive barrier" , which can be ideas for writing high-quality scripts, shooting techniques, editing techniques, and so on.

2. Scaling up the consumption of short dramas:

1) “Operator”:

In the scale-up stage, operators need to expand the access volume of products and operate multiple short dramas at the same time to expand the scale of team income. Similar to the previous point, operators also need to summarize their past high-quality operation experience, such as "how to select explosive products" and "how to design marketing plans", etc. These are their "competitive barriers" in the scale-up stage.

2) “Playing platform”:

During the scale-up phase, the broadcasting platform needs to increase the introduction of products and the amount of content on the platform. It can appropriately increase the budget for stratification and copyright purchases to attract more high-quality content. For the broadcasting platform, exclusive content resources can be regarded as a "competitive barrier" , which places higher requirements on content introducers.

3) “Customer acquisition platform”:

In the scale-up stage, the customer acquisition platform can further increase the supply of content (generally, the "customer acquisition platform" and the "broadcasting platform" are both performed by the same team, so this step can also be done by increasing the budget investment to increase the supply of content), or increase the number of connected broadcasting platforms. This step is to ensure that there is sufficient and high-quality content to meet the needs of the scale-up stage.

When there is sufficient content supply, the customer acquisition platform can fully expand the micro-short drama business to the existing user groups to maximize the revenue of the short drama business. The key to this step is to accurately match the content with user needs to maximize the content revenue.

At the same time, the customer acquisition platform can also expand the user scale of the "micro-short drama" platform, such as acquiring customers through buying volume, marketing activities, etc., and then introducing them into the micro-short drama business for monetization, thereby increasing the overall revenue of the platform.

Therefore, the scale of users available for diversion, content classification experience, user portrait tags, and high-conversion content push methods can be regarded as the "competitive barriers" of the "customer acquisition platform."

BTW, in the scale-up process, you often need to pay attention to the following points:

1) Accumulation and summary of successful experience:

A success is caused by the team's advantages, but also by accidental factors due to "the right time, right place and right people". When the team moves towards large-scale production, the team leader needs to summarize and accumulate the previous excellent production experience, such as ideas for high-quality script creation, shooting techniques, editing techniques, etc.

This will "empower" the newly recruited members and ensure that the delivery quality of the new team is not too low.

The key to this step is how to "take the essence and discard the dross". Because the person in charge can easily make attribution errors due to lack of experience, and pass on the "dross" as the "essence". This requires the person in charge to look at past experience objectively and distinguish "merits and demerits". The high-quality "essence precipitation" is often one of the barriers of the team , which can help the team quickly expand in scale.

2) Personnel training and management:

Scaling up means an increase in the team's business volume, and an increase in business volume means an increase in the team's staffing needs. A large number of team members will increase many uncertainties, such as "low delivery quality" due to "uneven team experience" and "lower execution efficiency" due to "cumbersome communication". These uncertainties will reduce the overall combat effectiveness of the team and hinder the scale of our business.

Therefore, in the process of personnel expansion, it is necessary to establish certain personnel training and management mechanisms, accumulate successful experiences and empower the team, and reduce the impact of "uncertain factors" through certain mechanisms.

3) Take small steps and expand cautiously:

We need to identify the strengths of our team and the areas of our team's strengths to avoid running into areas we are not good at during the scale-up phase. Otherwise, the MVP verification previously conducted will be wasted, and the barriers previously built will be destroyed due to expansion along the wrong path.

Here we can give priority to expanding the "adjacent field". What is the adjacent field?

We can divide the quadrants into four quadrants according to whether the users are the same and whether the needs are the same.

From this, we can derive four areas, namely:

1) Current field: the original business field of the enterprise.

2) Two areas of expansion: areas that are similar to the current business, divided into "same users with different needs" and "same needs with different users". The advantage of prioritizing the expansion of adjacent areas is that "past successful experiences can be fully utilized". For example, the producers of male-oriented short dramas used to make their fortunes from "male-oriented ancient costume short dramas". They can consider expanding the content of "workplace short dramas" for the "male-oriented short drama" user group to meet the different needs of the same user group.

3) Dangerous areas: For enterprises, this is an unfamiliar area, and previous experience cannot be used. There is a huge cost of trial and error. Avoid exploring dangerous areas. If you take a big step, you may get into trouble.

04 The second curve of maturity

After the long term, the business has reached a certain scale and can bring a certain amount of benefits to the company. At this time, the business focus is on "maintaining stability" and starting to explore the "second curve" to seek more possibilities and build more barriers to deal with unknown risks.

So how to explore the second curve? I think we can "expand similar positions in the business ecosystem." For example, a company that was originally a "customer acquisition platform" can start to engage in the "micro-short drama production" business, just like Douyin, Kuaishou, and Tencent have personally produced micro-short dramas, or support micro-short drama production manufacturers through policies.

As shown in the figure, Douyin launched the "Morning Star Plan" this year, launching two major cooperation models: joint production and joint operation, aiming to support the micro-short drama content on the platform and maximize the platform's revenue. This also means that the business of "micro-short drama producers" and "micro-short drama operators" can be regarded as Douyin's "second curve."

The picture comes from the Internet

But no matter what, it is best to fully utilize existing accumulation to explore the second curve. For example, the "customer acquisition platform" can use the supplier's relationship chain and huge capital accumulation to quickly expand into the "micro-short drama production" business.

05 Summary

The above is my personal thoughts on “What should a company do if it wants to expand its micro-short drama business?”

Consistent with the development ideas of all products/businesses, it is necessary to first verify the feasibility in the startup phase, then scale the business in the growth phase, and finally explore the second curve in the mature phase.