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Half a year after the "Little Composition Storm", Yu Minhong and Dong Yufang announced that anchor Dong Yuhui resigned and withdrew his equity, which means that walking with Hui will truly become the shelter of Dong Yuhui's port. A number that has lost its most important weight will no longer have any equity-level connection. What will happen to the two top live broadcast rooms in the future?

Dong Yuhui goes solo

According to the detailed announcement released by Oriental Selection, Dong Yuhui (buyer), Beijing New Oriental Xuncheng Network Technology Co., Ltd. (seller) and Yuhui Tongxing (Beijing) Technology Co., Ltd. (target company) entered into a sales agreement, pursuant to which the seller agreed to sell and the buyer agreed to acquire 100% of the target company's equity. According to the announcement of Oriental Selection, Yuhui Tongxing's net profit since its establishment is 141 million yuan. According to estimates, the price of 100% of Yuhui Tongxing's equity is 76.5855 million yuan.

At the same time, Oriental Selection stated that in addition to paying all the promised benefits and compensation to Dong Yuhui, the chairman of the board, Yu Minhong, has sought approval from the board and the board's remuneration committee to distribute all the remaining undistributed profits of Yihui Xingtong to Dong Yuhui. In addition, in accordance with the listing rules and the company's articles of association, Yu Minhong has made arrangements for the settlement price of Dong Yuhui's acquisition of Yihui Xingtong. In order to maintain the normal operation of Yihui Xingtong, the company will provide Yihui Xingtong with its self-developed information system free of charge.

It is not difficult to see that both Yu Minhong and Dong Yuhui hope that this separation will be friendly and decent. On the same day, Yu Minhong and Dong Yuhui responded to the incident at the same time. Yu Minhong said that starting from July 25, Dongfangxuan's wholly-owned subsidiary, Yihuixingxing, will officially become independent from Dongfangxuan, and Dong Yuhui will personally hold 100% of its shares. And Dong Yuhui also said with emotion that considering the actual situation and development plan, after friendly consultation and unanimous decision by both parties, Yihuixingxing will start to operate independently.

Although Dong Yuhui expressed his gratitude for Yu Minhong's cultivation in his response, putting aside personal relationships, at the capital level, Dong Yuhui's resignation and his acquisition of Youhui Tongxing mean that the core IP figure of Oriental Selection has drawn a clear line with Oriental Selection. Youhui Tongxing will truly operate independently under Dong Yuhui's will, and Yu Minhong's personal influence will be greatly reduced.

In the view of Ge Wenwei, partner of Duojing Capital, the "breakup" between Dong Yuhui and Dongfang Zhenxuan is an inevitable outcome. From the outbreak of the "Little Composition Incident" at the end of last year to the establishment of Yihui Xingtong, the measures taken by Dongfang Zhenxuan and Yu Minhong were just superficial avoidance of conflicts, and did not really resolve the conflict between Dong Yuhui's personal rights and interests and the company's rights and interests. Today, Yihui Xingtong is completely independent, which also means that the conflicts and contradictions in the past have been completely resolved.

Unexpected disclosure points

Compared to Wei Ya and Luo Yonghao who passively or actively stayed behind the scenes, Dong Yuhui’s parting with Oriental Selection was more or less painful. At the end of December 2013, a “small essay” incident about who wrote the copy tore apart the relationship between Dong Yuhui’s fans and Oriental Selection, and this relationship was difficult to completely repair in the following months.

Many of the choices made by Oriental Selection are inevitably influenced by fans' emotions and public opinion. For example, after the "Little Composition" incident, Oriental Selection CEO Sun Dongxu resigned. Dong Yuhui was promoted and became the legal person of Huixing, and also set up a personal studio to do cultural and tourism projects. However, the good times did not last long. On "6.18", the live broadcast style of Oriental Selection anchor Dun Dun was once again attacked by fans. Yu Minhong also had to apologize and personally comment on the remarks that "Oriental Selection is a mess." Dong Yuhui mentioned "resistance to selling goods" in the variety show, which pushed public opinion to the peak.

However, frequent public opinion storms have affected the normal operation of both Dongfang Zhenxuan and Yuhui Tongxing. Yu Minhong admitted that the complex public opinion disputes directly led to the estrangement between Dongfang Zhenxuan and Yuhui Tongxing, and there was huge uncertainty in the development of the two companies. The stock price fluctuated violently due to external influences, and the company's credibility and reputation dropped sharply. In response to this situation, Yu Minhong and Dong Yuhui met several times in March this year to discuss development plans. It was finally decided that after the end of Dongfang Zhenxuan's fiscal year (May 31, 2024), 100% of Yuhui Tongxing's shares would be transferred to Dong Yuhui himself.

In fact, before the official announcement of Dong Yuhui's resignation, Yuhui Xingxing had just moved to a new office. Judging from the time nodes of the release of Dongfang Zhenxuan and New Oriental's financial reports in previous years, the end of August and the end of July were the annual report disclosure times of the two companies respectively. The release of this resignation announcement was just before the two listed companies were about to disclose their annual reports. Many industry insiders said they didn't understand why they chose this time to release the heavy news.

Yu Miao, founder of Sulu Consulting, said in an interview with Beijing Business Daily that timely release of resignation announcements is in line with disclosure principles of listed companies, but this move may also have an impact on Oriental Selection's subsequent market data performance.

Influenced by this news, New Oriental's US stock opened down more than 4%. As of press time, New Oriental's stock price was $71.01, down 4.36%. Talking about the future stock price trend of Oriental Selection and New Oriental, Yu Miao and Ge Wenwei both said that Oriental Selection may usher in a period of stock price fluctuations.

"Switch your waist"

Compared with other top anchors who gradually disappeared, Dong Yuhui's sudden "stripping" will inevitably cause Oriental Selection to suffer pain for a period of time, because Dong Yuhui's personal IP is obviously more attractive than Oriental Selection. The latest data shows that as of 9 pm on July 25, the number of fans of the Douyin account of "Oriental Selection" was 29.867 million, and the number of fans of the Douyin account of "Walking with Hui" was 21.528 million. After 7 months of broadcasting, the number of fans of "Walking with Hui" has been getting closer and closer to "Oriental Selection". In addition, the third-party data platform Feigua also shows that in the overall list of influencers in June this year, "Walking with Hui" ranked second, and "Oriental Selection" did not enter the top ten.

"The departure of a top anchor can easily cause a company to suffer a setback." Zhao Zhenying, a researcher at the National Engineering Laboratory for E-Commerce Transaction Technology, told the Beijing Business Daily that although Oriental Selection started putting its eggs in different baskets a long time ago, the departure of a top anchor will still make it face the problem of acquiring traffic in a short period of time.

After the official announcement of complete independence and no longer working with "Hui", Dongfang Zhenxuan's GMV and other related data performance may face new challenges. In Yu Miao's view, after independence, Dongfang Zhenxuan and Hui will become each other's biggest competitors. Judging from the past stock price and sales performance, Dong Yuhui's departure is bound to have an impact on Dongfang Zhenxuan in the short term.

Jiang Rong, an e-commerce research expert, believes that the pressure that Dongfang Zhenxuan will face in the future is still great. "The sales data of Yuhuixingxing is much higher than that of Dongfang Zhenxuan, which means that the form of live streaming sales is very dependent on big IPs. Dongfang Zhenxuan has not yet cultivated other influential IPs, which will be a big challenge for it."

"Dong Yuhui's departure will have a certain impact on the user loyalty of the Oriental Selection brand. Oriental Selection needs to constantly adjust and optimize its strategic and operational strategies, strengthen brand building and user loyalty cultivation, while paying attention to technological innovation and improving supply chain capabilities." Zhao Zhenying pointed out.

Ge Wenwei said that Dong Yuhui's complete departure may be a good thing for Oriental Selection and New Oriental. From the sudden explosion to the present, Oriental Selection and Dong Yuhui have experienced various public opinions, and the company's stock price has also been on a roller coaster. After this experience and change, both parties have started again, which may be a more favorable choice for the long-term development of the two companies. In Ge Wenwei's view, at this stage and in the next stage, Oriental Selection should think more about how to make the business last longer when the platform traffic has bottomed out and the super IP is no longer there.

In order to learn more about Dong Yuhui's resignation, the independence of Yuhui Xingxing, and the future development of Oriental Selection, a Beijing Business Daily reporter sent an interview message to the staff of Oriental Selection, but no response was received as of press time.

Institutions and anchors

The tug of war between super anchors and live broadcasting organizations is always going on. The top anchors use the traffic dividend and personal influence to expand the live broadcasting business, thereby incubating live broadcasting organizations. The live broadcasting organizations must also take into account the company's long-term stable and healthy development path to avoid the top anchors' words and deeds from affecting the company. Whether it is Wei Ya's tax evasion in 2021, or Simba's scolding of Kuaishou on the eve of "6.18" this year, which caused Xinxuan to apologize to the platform in a hurry, all show the contradictions in the relationship between the two parties: the performance of the organization depends on the traffic of the big IP, but it is also trapped by the personal words and deeds of the super anchors that are difficult to control.

Perhaps both parties are eager to find a comfortable space in the bundle. In recent years, Luo Yonghao, Simba and Li Jiaqi have significantly reduced the frequency of live broadcasts, and live broadcast organizations have also used the IP of super anchors to make variety shows, own brands, concerts, etc., trying various means of commercial realization, and continue to recruit new anchors to open more vertical accounts, thereby diluting the risk of relying on top anchors. For example, Three Sheep plans to incubate 10,000 anchors in the future, and Li Jiaqi's assistant Wangwang has also been active in the variety show "My Girl" recently to strengthen the influence of his personality.

But looking at Dong Yuhui, can he make a seamless transition from being a live streamer to operating a company? Jiang Rong pointed out that the original top streamers faded out of the live streaming room mainly because they had reached a stage of financial and physical fatigue, which does not mean that the era of big streamers is over, and new streamers will continue to emerge. "Top streamers are still valuable IPs, and their ability to bring goods and realize cash is still very strong, so they will exist for a long time."

"The success of an anchor is related to his/her appearance, personality, knowledge, emotional intelligence, etc., and has a certain degree of randomness. The probability of completely copying success is not very high, but it does not affect the live broadcast organization to create new anchors." Zhao Zhenying said that although Dongfang Zhenxuan now has a relatively diversified anchor team, how to maintain the stability and sales ability of these anchors will be an important aspect that needs to be paid attention to in the future. Once the anchor team becomes unstable, it may have an adverse impact on the company's performance.

Beijing Business Daily reporter He Qian, Qiao Xinyi, Zhao Boyu

Image source: Live screenshot