The Addition And Subtraction Method Of Youzu Network: Can Teenagers Return In The Post Lynch Era?

        An accident began at Christmas 2020 when Lynch, the founder of Youzu, suddenly died, making Youzu network the focus of public opinion.

"At that time, more pressure came from communication with the outside world and inside. Because many people will have misunderstandings and ignore the existence of objective facts, that is, the company's business itself is running normally, and players still like our products. " On June 16, in the office of Youzu network's headquarters building, Chen Fang, CEO of Youzu network, reviewed the stressful days when he joined the company for nearly three years.

On the same day, Youzu network, for the first time, combined the youth day for players with the 12th anniversary celebration, and held a celebration activity with the theme of "youth, welcome home". On the one hand, this large-scale activity which emphasizes returning to the original intention of the game is to bring confidence to more than 2000 "clansmen". On the other hand, it also announced a series of actions such as the mission vision, clear strategic direction and business progress of the enterprise. I hope you can pay attention to the steady development of Youzu's main game business.

"The sudden death of the founder is indeed a severe test for a company, but first of all, the direction of the company has not changed, and it has experienced such difficulties, which also gives us confidence to face the challenges in the future. These employees are those who accompany the company through this period of storm. We have reason to be more optimistic to face the future. " Chen Fang believes that there will be no more attacks, which can be worse than those in the past.

Loss for the first time since listing

Prior to that, Youzu network carried out a research activity, which described the response of the board of directors after the event, as well as the adjustment of the governance structure of listed companies.

As CEO, Chen Fang is mainly responsible for the company's overall business and management, and vice president Liu wanqin is responsible for the company's global business. The company has also set up a management committee to discuss and make decisions on the company's strategy, organization and business development.

At present, Youzu is making efforts in addition and subtraction at the same time. While stripping off the main business of non game, it also strengthens the R & D investment in the main track and main business.

On June 16, Youzu network announced the establishment of the Innovation Institute, and made it clear that the annual investment amount will not be less than 10% of the gross profit for the research and development and investment of innovative projects and products. In view of the original advantages of card and SLG track, Youzu network has also carried out internal organizational structure adjustment: Youth studio, war studio, Qianlong studio, Baichuan studio and rice ball studio will be upgraded to the first level department, reporting directly to the CEO and the management committee.

"The next step is to return to the original intention of the game industry, focusing more on the main business, the main track and the main project, and consolidating the two major sub circuits of card and SLG. E-sports, UAVs, MCN, these non main business projects incubation will be suspended. " Chen Fang revealed that Youzu has also introduced a set of incentive scheme, which is mainly based on profit, stable and operable, clear and calculable, to mobilize the enthusiasm of the business team and enhance the management team and the awareness of independent operation and cost of the front-line business departments.

Behind the adjustment is the pressure on the performance of Youzu network. According to the company's annual report, the company realized an operating revenue of 4.703 billion yuan in 2020, with a year-on-year increase of 46.04%, but its net profit was the first loss since its listing in 2014.

How to reverse this situation? Chen Fang also revealed her own thinking, "focus is the most important. On the other hand, it will increase the investment in R & D and talents, because good products can achieve twice the result with half the effort for marketing. We have implemented the "20 + X" incentive policy. The "20" refers to the commitment of no less than 20% of the operating profit to the business team. Through a series of detailed provisions and process management, we will optimize the cost, improve human efficiency and the accuracy of budget completion‘ X 'means that Youzu is willing to share the company's growth benefits with business backbone and high potential employees, and has recently released a long-term incentive plan. "

In addition, an important means to combat the slowdown in the industry is globalization. Youzu network has been on the journey of globalization since 2013, and is the first game manufacturer in China to go out to sea.

Overseas market will be paid more attention

Speculation about emergencies is also spreading overseas.

The overseas employees and partners of Youzu network will come to inquire about the news just like their Chinese colleagues. But to some extent, the group chairman is still too far away for them. Some of them have never met, others have only heard of their names. They are more concerned about whether the internationalization strategy will change? Will the direction of the company change?

Liu wanqin, vice president of Youzu network, who is in charge of overseas distribution business, intensively communicated with the person in charge of overseas business during that period, and then made plans. Overseas market, as a growing business and half of the annual revenue of the tourists, will also be paid more attention.

"After the accident, it took us a few months to readjust and determine the new direction. In fact, the direction has always been very clear, that is to ensure the growth of the business. This year, we will continue to make efforts in card and SLG, and try some competitive products and customized products overseas. This year, we have a self-developed and self-developed global SLG product, infinity Kingdom, which has been operating overseas since January, and then considering introducing it back home. This product is a global product from the beginning of the project. The whole character setting and playing method are more international. It is also a big opportunity and challenge to go online directly in overseas key markets. " She explained to the 21st century economic reporter.

Over the past years, the overseas market has been the growth point for Youzu network to break through the bottleneck. According to the financial report, since 2016, the overseas market revenue of Youzu has exceeded the domestic market. In 2019, the annual revenue of Youzu network is nearly 3.22 billion yuan, including 2.03 billion yuan from overseas game business, accounting for 63%. In 2020, the overseas market revenue of Youzu network will reach 2.59 billion yuan, with a year-on-year growth of 27.7%.

"Different countries and nationalities have different cultures, languages and user preferences. We will decide on different distribution strategies and rhythms for different regions. As the Japanese and Korean markets tend to be saturated, the competition will be more fierce, and the flow cost will also rise. But the Latin American market is basically still blue ocean, and there are more opportunities. " Liu wanqin said, "but overseas you are a regional and multi category layout, and each market has opportunities in our view. Strategically, we will continue to explore some low-lying tracks and themes, and then make full use of global resources to land them. "

Nowadays, almost every game company takes "going out to sea" as an important strategy. According to the data released by the game Working Committee of China Association of audio and digital technology, in 2020, the number of Chinese game users will exceed 660 million, and the actual market size of China's game market will reach 278.687 billion yuan, with a year-on-year increase of 20.71% and a year-on-year increase of 13.05%. The actual sales revenue of self-developed games in the overseas market was US $15.45 billion, with a year-on-year increase of 33.25% and a year-on-year increase of 12.3%. This means that the growth rate of overseas game market is significantly higher than that of domestic market, but the proportion of actual revenue still needs to be improved.

Non main business is being spun off

The future of Youzu network has been conjectured by the outside world. Although the youth sentiment is moving, investors and employees are more concerned about the next step.

On the evening of June 2, youzu.com released a stock price change announcement, saying that after verification, Xu Fenfen, the legal guardian of the company's original controlling shareholder and successor of Lin Qi, the actual controller, is planning major issues related to equity transfer, and has made great progress recently, and there are still uncertainties in this matter.

According to the first quarter report of 2021 released by youzu.com, Q1's performance in 2021 has rebounded, with a net profit of 187 million yuan. At the same time, Chen Fang also released an "open letter to top priority investors" internally. The "highest priority investor" here is Chen Fang's address to all employees of Youzu network. He frankly said that traditional investors use money and capital, while employees use youth and career.

According to the open letter, since the company has stripped off the non main business investment and even the team in Q1, through cost control and resource allocation optimization, the past quarter was the quarter with the highest management gross profit and gross profit margin in the history of Youzu, and the quarter with the highest matching degree of budget. Chen Fang mentioned that during the peak period of turnover in the market from February to April, the voluntary turnover rate of the company's employees this year was the lowest in recent years.

He believes that Youzu network is an independent listed company and has built a relatively mature ecological and capability system in the past 12 years. At the same time, the game is still a win by content industry, and the core of users is to focus on the game itself.

At the 616 event site, you also announced four self-developed new products in preparation for testing and release: Notes on new tomb robbers, fire and eternity, code name: walker, and code name: jgame. In addition, more than a dozen products including "Santi" are also under development.

"As one of the most important projects of the company, the strategic significance of" three bodies "is self-evident. The development of this IP game work is not limited to one product, but it is hoped that based on the IP itself, the power of the whole industry chain will be gathered for matrix product layout. " Chen Fang further added.

Between addition and subtraction, in the game industry, it depends on the long-term operation ability of existing products and the performance of new games in the future, so as to really decide whether the "Youth" can return.