The general public believes that the livestream business “saved” Momo’s revenue. In fact, what the livestream business did save was the monthly active user growth. In Momo’s 2015 Quarterly Reports, there are these sets of data:

　　March 2015: Monthly active users—— 78.1 million.

　　June 2015: Monthly active users—— 78.4 million.

　　September 2015: Monthly active users—— 73 million.

　　April 2015: Monthly active users—— 69.8 million.

　　It’s evident that the year of 2015 had been a tough year for Momo as its monthly active user base continued to drop. The number of active users in Q4 had had a 12% drop compared with that of the first quarter. User acquisition has always been the first priority of the Internet industry. When Momo was losing its users, some even commented that Momo was over.

　　However, as Momo’s livestream business rises, the number of Momo’s monthly active users has also been surging since the first quarter of 2016. The figures of monthly active users of 2016’s quarters had been, 72.3 million, 74.8 million, 77.4 million and 81.1 million. In 2017’s first quarter, the number hit 85.2 million, an 18% year-on-year growth.

　　It’s apparent that Momo would be able to have more business moves, for example, short video business, with these monthly active users.

　　Deploying a social-networking playground

　　Even if the livestream business can become the “milk tank” for Momo to cash in, it seems to the public that Momo has been focusing on its short video business instead.

　　At the end of March Momo pushed a new update, which integrated the short video use cases, Moments and Timeline, together. It also added a new tag “follow” at the bottom of the navigation bar, which aggregates quality short video contents, including contents user have followed and recommended contents selected by the recommendation engine based on big data.

　　Momo also changed its logo. Its slogan has also changed from “always something amazing around you” to “social networking through videos, here on Momo”. The company has deployed massive advertising campaigns in over 300 cities in the country, covering subways, public buses, movie theaters, elevators, taxi cabs etc., aiming to swarm the users from all angles.

　　As an ordinary user, I also experienced Momo’s video social networking features, posting a short video #ThisIsMeToday. The short video received six comments, five likes and 156 views in two hours. If I started to interact with users that commented on me, a round of video social networking was completed.

　　Momo’s Q1 earnings showcases the social-networking integration of its video and greater entertainment businesses. Its short video has a penetration rate of 46% among daily active users. The year-on-year growth of daily active users hit 12%. The daily formation of networking had also surged by 50% in numbers. More users are getting used to express themselves in videos. This video contents in fact forge a content ecosystem.

　　However, Momo’s founder Tang Yan believes that whether it’s the livestream or the short video feature, they all serve the purpose of social networking. He had reiterated over and over again during the phone meeting that:

　　“Social networking has always been the center of business for Momo. Whether it’s short video, livestream, community or the nearby feature, they are all part of the social-networking scene. They are like different infrastructures in an amusement park.”

　　For social-networking platforms, the number of monthly active users and user retention rate are most essential. To keep the users, the entertainment infrastructures in the amusement must be appealing. Besides contents produced by users, Momo itself has also been enriching its content ecosystem:

　　Momo had invited a group of folk music musicians and the 12 Girls Band to its livestream platform as regular performers, showing a diversity of livestreaming contents.

　　Every week Momo would set up a short video theme, such as “My pet is super smart”, “Crazy dance” etc., encouraging more users to participate.

　　All these moves are initiated to keep users to stay on Momo and have fun.

　　That’s why instead of the profit surge, I am more intrigued by Momo’s user growth. Short video and livestream might not be popular after a while, but as long as the company has users in its disposal, it has opportunities.

　　For instance, many might only notice the strong growth provided by the livestream business. But it’s also worth noting that Momo had cashed in $17.9 million through mobile advertisements, a 45% year-on-year growth. The company also profits by $11.6 million, a 56% jump year-on-year. These two lines also hold immense potential. The development of short the video business will even lead to the reconstruction of the mobile marketing and advertising layout. Momo, as one of the major players, would definitely have its fair share of the cake. Who knows whether or not Momo would develop it Honor of Kings in the future, right?

　　What Momo is doing and will continue to do is enrich its social networking platform, acquiring and keeping more users. These users would be the company’s future possibilities.

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　　The article is published with authorization from the author @Ma Youkong, please note source and hyperlink when reproduce.]

　　Translated by Garrett Lee(Senior Translator at PAGE TO PAGE), working for TMTpost.