Steady Progress: 3 Strategies for BAIO's Interactive Content Innovation, Long-term Operation, and Marketing Overseas

A set of public data indicates that the number of global gamers is expected to reach 3.4 billion this year. In terms of online numbers, over 1 billion people are immersed in the gaming world every day, a figure more than double the population of Europe, undoubtedly proving that gaming has become an indispensable part of people's daily lives.

Shifting the perspective to domestic, the "China Game Industry Report for January-June 2024" shows that the actual sales revenue of the domestic game market reached 147.267 billion yuan in the first half of this year, a year-on-year increase of 2.08%, maintaining a steady growth trend. This data is sufficient to demonstrate that despite the many challenges still faced by the gaming industry, the market still has strong growth resilience and potential.

However, against the backdrop of the regular issuance of game licenses, the dense launch of new games provides players with more choices, leading to an increasing standard for game selection among players. Among the many game options, the richness of content, innovation, and appeal have become key factors in players' decision-making.

In the current stage where the game market has entered a stock phase, this trend also poses higher requirements for major domestic game manufacturers.

Looking through the interim financial reports recently released by Hong Kong-listed gaming companies, Bai Ao Family Interaction has achieved good results in content innovation, long-term IP cultivation, refined marketing strategies, and global layout.

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The latest financial report shows that in the first half of 2024, Bai Ao Family Interaction achieved a revenue of about 270 million yuan, with an adjusted net loss of about 9.77 million yuan. It is worth further analysis on this.

Focusing on R&D to help content innovation and continuously optimize the gaming experience

Firstly, it cannot be denied that continuously innovating game content and providing players with a sense of freshness is not easy, but it is the key to driving the continuous growth of game manufacturers and winning the market. To achieve this goal, following market trends, utilizing emerging technologies, and continuously innovating in R&D are essential elements.

The financial report shows that in the first half of the year, Bai Ao Family Interaction continued to maintain high R&D investment, reaching 99.6 million yuan, with the proportion of R&D investment in operating income continuing to increase, reaching 37%. At the same time, the proportion of the company's R&D team continues to be as high as more than 80%, with a total of 569 people. This reflects the company's emphasis on R&D and more importantly, shows its determination to improve product quality and innovation capabilities.

In the first half of the year, Bai Ao Family Interaction did not relax in the innovation of high-quality content, insisting on taking user needs as the core, continuously optimizing the gaming experience, and continuously strengthening its content output capabilities.Taking the company's core self-developed IP mobile game "Aoki Legend" as an example, as a spirit collection, cultivation, and battle game that has been online for three years, "Aoki Legend" mobile game still maintains a stable version content volume, continuously produces rich and interesting gameplay, and maintains high community activity and player discussion heat.

In order to further improve user stickiness and enhance the innovation of the game, the company continuously optimizes and expands the gameplay of "Aoki Legend". For example, the "pet cultivation system" launched last year provided a good experience for players in long-term operation. In 2024, based on the round-robin strategy battle, the new version of "Aoki Legend Mobile Game" will successively launch innovative gameplays such as home three elimination, script killing, meat pigeon, and self-chess, and design different strategic challenge forms in the acquisition of spirits, greatly increasing the depth and interest of the game.

In addition, in the first half of the year, Bai Ao Family Interaction seized the AI technology trend, actively explored the application of AI in game design and operation and other businesses, in order to more efficiently meet the diversified user needs.

By integrating AI technology into the product, the company continuously enriches the playability of its games and enhances product competitiveness. In March this year, "Aobi Island: Dream Kingdom" launched an AI assistant consultation function, introducing the traveler "Schwarzschild", as the intelligent assistant of the Galaxy TV station, "Schwarzschild" can accurately identify the player's intention, providing emotional companionship and customer service consultation functions.

This year, the company will further develop in the multimodal field of voice and large models, integrate personalized voice interaction functions into the game gameplay, deepen the player's interactive experience, and create a more realistic and emotional game world. This not only greatly improves the player's gaming experience but also demonstrates the practical application potential of AI technology in the game.

Excellent IP long-term operation ability, user stickiness continues to increase.

However, it is certainly important to innovate game content to attract players, but to maintain the user group for a long time, it is more important to test the game manufacturer's long-term IP operation ability. This is not only related to the immediate attractiveness of the game, but also involves how to deepen the player's emotional connection and brand loyalty through continuous operation ability.

Relying on the strategy of adhering to the fine IP long-life cycle strategy, Bai Ao Family Interaction now occupies a place in the fierce market competition.

The operation of the classic explosive IP "Aobi Island" is a clear example. Since its launch for more than 15 years, the "Aobi Island" IP still shows tenacious vitality.

At the same time, the mobile game "Aobi Island: Dream Kingdom" has also accumulated超高 popularity through rich and diverse cross-border linkages and gameplay innovations. Since its launch, the mobile game has累计联动 with 23 IPs and brands, including CCTV Animation, Pleasant Goat and Big Big Wolf, Trendy Play IP ShinWoo Ghost Bear, EMMA, Tea Baidao, Laiyifen, etc. These linkages not only expand the game's audience base but also bring fresh gaming experiences to players, effectively enhancing user stickiness.It is worth mentioning that games are not only tools for entertainment but also powerful carriers for cultural dissemination. In this field, Baiao Family Interactive actively explores the integration of cultural creativity across different fields. Through IP collaboration strategies, it continuously injects fresh elements into games, promoting and inheriting traditional Chinese culture.

In this process, the company not only promotes the deep integration of IPs with games, endowing them with profound content accumulation, but also enhances brand influence. This ensures the enduring vitality of IPs, continuously attracting player attention.

During the Spring Festival, the mobile game "Aobi Island: Dream Kingdom" collaborated with the Forbidden City Court Culture IP "The World Inside the Palace," launching a Spring Festival version. The game recreated the "Forbidden City" as a massive scene, including the Taihe Gate Square, Taihe Hall area, Imperial Garden, Eastern Six Palaces, and Western Six Palaces, and designed the "Fenghua Festival" event page based on their layout. Players can freely move around "inside the Forbidden City." In addition, the game introduced a hidden scene, "Qingming Shanghe Picture · Illusion," allowing players to immerse themselves in the famous painting and experience the life of ancient times. Moreover, this collaboration combined clothing with cultural relics, drawing inspiration from four treasured relics—Jinou Yonggu Cup, Blue Glaze Gilded Small Mallet Bottle, Qianli River and Mountain Painting, and Silk Flocking Velvet Flower Fruit Picture Dyed Carved Bone Handle Round Fan. The design references their color schemes and patterns, aiming to maximize the reproduction of the characteristics of the cultural relics.

Another long-term IP, "Aoqi Legend" web game, which has been online for over 12 years, still focuses on innovative gameplay mechanisms, achieving a continuous increase in revenue in the first half of the year, accounting for 26.6% of total revenue. The "Aoqi Legend" mobile game also achieved a significant year-on-year increase in revenue in the first half of the year through breakthroughs in version content and good user operations, accounting for 19.5% of total revenue.

These achievements, on the one hand, confirm the company's accumulation of a deep user base, and on the other hand, reflect the company's capabilities in long-term game operations. It is foreseeable that as the company continues to focus on long-term IP operations, continuously launching innovative content and optimizing user experience, these classic IPs will continue to contribute stable and considerable long-term revenue to the company in the future, driving its own sustainable development.

At the same time, these successful experiences can also be applied to the operation of more game products under Baiao Family Interactive. Through continuous innovation, it indicates that the company has the ability to create one long-term IP after another, like "Aobi Island" and "Aoqi Legend," forming a unique competitive advantage in the game market, and ultimately achieving continuous growth in brand value and expansion of market influence.

Marketing Innovation and Deepening Overseas Expansion, Multi-dimensional Release of Game Value

Of course, the fundamental purpose of game products, whether in content innovation or long-term operations, is still to create economic benefits for game manufacturers. In this process, how to maximize the commercial value of IPs and game products, achieving a win-win situation between business and user experience, is also an important subject explored by the game industry.

Baiao Family Interactive has taken two major initiatives.

Firstly, in terms of marketing, it innovates in new forms to establish closer connections with players.In the marketing of the mobile game "Aobi Island: Dream Kingdom," the company not only interacts with players online through live broadcasts and other forms but also actively organizes offline player meet-ups and themed restaurant events to close the gap with players, effectively increasing community activity and further enhancing player retention and the vitality of the IP.

Currently, the Aobi Island mobile game's Weibo Super Topic has reached nearly 6.4 billion reads. This number not only proves its extensive community influence but also reflects the players' high recognition and participation in the game content.

Furthermore, the company actively promotes the construction of a secondary creation ecosystem, stimulating a large number of players' enthusiasm for secondary creation within the core community. In July, the launch of the "Aobi Island Mobile Game 2nd Anniversary" National Creation Contest attracted a large number of players on multiple platforms such as Douyin, Xiaohongshu, Bilibili, and Weibo, further enriching the game's cultural connotations and player experience.

Secondly, the continuous upgrade of the overseas strategy maximizes the game's commercial value. The overseas market still has tremendous development potential, with the global market size reaching 1,170 billion yuan in 2023, a year-on-year increase of 6%. At the same time, the sales revenue of Chinese self-developed games in the overseas market reached 16.366 billion US dollars, accounting for nearly 10% of the global market share. Therefore, to meet the needs of players in different regions, the company will continue to increase its promotion efforts in the overseas market, widely covering Mainland China, Hong Kong, Macao, Taiwan, Japan, South Korea, and Europe and America.

In the future, the company will focus on its strengths in niche markets, relying on years of accumulated experience to launch differentiated products overseas. In addition, the core self-developed IP will continue to go overseas, with the overseas version of "Aobi Island Mobile Game" actively being tested. Not only that, but the company will also leverage its advantages to actively expand into new categories, seize market trends, fill the gaps in the overseas market, maximize the IP and brand value overseas, and provide a continuous driving force for performance growth. Currently, the company has six products in reserve, focusing on multi-category layout to create a rich product matrix.

Conclusion

Returning to the macro perspective, in August, the release of the top-level design "Opinions on Promoting the High-Quality Development of Service Consumption" specifically mentioned "online games." This is not only of milestone significance to the entire gaming industry but also an important driving force for the steady growth of the game market scale.

Therefore, we have reason to believe that with positive development trends in policy support, market trends, regular issuance of game licenses, technological innovation, and other aspects, as the intrinsic value of the BaiAo family interaction gradually emerges, the company will continue to be validated in terms of performance, and its value will also grow accordingly.