The inside story of the breakup of Xingmei Cat's Eye: The battle for power for theater e-commerce begins?

It is not accidental that Xingmei and Cat's Eye parted ways, but an inevitable outbreak of long-term deep conflict between theaters and e-commerce. It is the theater's "no" to the temptation of low-priced e-commerce tickets.

Not long ago, an analysis article about "Xingmei and Cat's Eye terminated cooperation" was widely rumored on the Internet. The article stated that "Xingmei fired the first shot in the battle between theaters and e-commerce." That is, Xingmei has closed its Cat's Eye. All ticket sales ports are available. This is a decision made by Xingmei to rebuild its membership system and strengthen cooperation with shareholder Baidu. Later, Cat's Eye and Xingmei both said that the online revelations were adding to the situation, and that the contract between the two parties was just expiring.

In response, Sina Entertainment exclusively received an in-depth response from Xingmei on this matter and further understood the reasons why third-party ticketing websites such as Cat's Eye stopped cooperating. In fact, it is not accidental that the two families parted ways, but an inevitable outbreak of long-term deep conflict between theaters and e-commerce. It is a "no" from theaters to the temptation of low-priced e-commerce tickets, and a declaration to take back the ticketing market. Established and powerful theaters such as Xingmei, which have a large number of studios, are unwilling to see their hard-cultivated member group relegated to a platform controlled by a third party. Therefore, they decided to take advantage of the expiration of this contract to regain the initiative. In their own hands, and at the same time join hands with Baidu to seek a blueprint for the future.

The development of e-commerce has now begun to enter a transition period, and a situation of forming cliques and dividing the world into three parts will gradually take shape. In the past, the era when the market could be swept by simply relying on low-priced tickets is gradually fading away. Faced with the joining of e-commerce, different theaters have their own ways of playing. On the one hand, Xingmei is separated from third-party platforms such as Cat's Eye and Dianping, and on the other hand, it has reached an in-depth cooperative partnership with Baidu. Joint-stock cooperation is the inevitable trend of future alliances between e-commerce and theaters.

Cause of the incident: Can't you buy tickets for Xingmei Theater Line on Cat's Eye?

Rumor 1: The guaranteed cooperation has not been completed; Rumor 2: Xingmei's cash flow is tight

. Around September 10, someone discovered that it was no longer possible to purchase movie tickets for Xingmei's more than 100 movie studios across the country on the Cat's Eye APP. It was later confirmed that Xingmei has closed all Cat's Eye ticketing ports.

According to "Entertainment Capital", there have been rumors that Cat's Eye has signed guaranteed agreements with many theaters owned by Xingmei. For example, Cat's Eye has agreed that the minimum sales in the theater will reach 700,000 yuan within a certain period of time. As a condition, the theater promises to pay Cat's Eye a ticket that is 5 yuan lower than other third-party channels. If the guaranteed sales cannot be reached, one way is for Cat Eye to subsidize the money to replenish the theater, and the other way is to extend the cooperation period until the minimum sales are completed. The rumor said that Cat's Eye preferred to extend the cooperation period, which led to dissatisfaction among theaters with Cat's Eye. However, both Cat's Eye and Sunmei denied the existence of such unequal treaties.

In addition, there is also a popular rumor that Xingmei's cash flow is too tight, and Cat's Eye's account period is too long and it fails to settle on time, causing Xingmei to threaten to cut off the ticketing port. Later, Xingmei and Cat's Eye once again denied this statement: Xingmei said that the cooperation with Cat's Eye is signed once a year, the cooperation is smooth, and Xingmei itself does not have a problem of tight cash flow. Cat's Eye said that Cat's billing period is similar to that of major domestic ticketing platforms, and the termination of cooperation with Xingmei is an act in normal business communication.

From this point of view, the breakup of Xingmei and Cat's Eye was not an accident, but there were deeper reasons behind it.

The real inside story: Xingmei has changed from passive to active. Cat Eye is not the only one who will no longer give up the platform to third parties

to terminate cooperation. It will further develop its own membership system

. Regarding the above rumors, Xingmei has responded exclusively and deeply to Sina Entertainment, revealing the termination of cooperation with Cat Eye. The real situation and the reasons behind it. The cooperation between Xingmei and Cat's Eye has indeed expired, and it will be difficult to continue in the future. In fact, not only Cat's Eye, Xingmei's ticketing port on Dianping has also been closed. Currently, Taobao, WeChat and other ports continue to be open. However, the proportion of votes sold by Xingmei through third-party ticketing platforms is constantly decreasing, and in the future, it will also provide third-party ticketing cooperation is further optimized.

"Third-party ticketing platforms can bring more movie-goers to theaters, which is commercially no problem," Zheng Jichong, CEO of Xingmei Group, told Sina Entertainment."But the role of these platforms is actually a double-edged sword for theaters. If the proportion of ticket sales on third-party platforms is too high, we will not be happy to see the benefits it brings. Because ticket purchasing occurs on platforms that we cannot control, Xingmei is passive and not a long-term solution. We ourselves are working hard to operate the membership system, and too low ticket prices will cause harm to the audience who are already members."

At the end of last year, Sina Entertainment reported in depth on the industrial ambitions behind low-priced e-commerce tickets. In the past two years, e-commerce has swept the movie market with a large number of low-priced tickets, launching ultra-low-priced movie tickets such as 19.9 yuan, 8.8 yuan or even 1 yuan. It seems that it is paying out of its own pocket to benefit audiences and increase the number of visitors to theaters. In fact, there is another plan behind it. Several powerful e-commerce companies have begun to rely on ticket sales to influence film scheduling, and have further become co-distributors and marketers, moving upstream of the film industry, with the intention of opening up online and offline in the future to take care of the overall situation. At the same time, e-commerce has obtained a large amount of user resources through ticket buyers registration and payment. We know that the number of users is the core of website valuation. For movie theaters, e-commerce's help in promotion is like taking drugs. It feels good in a short period of time, but in fact, it has already laid a major hidden disease for the body.

From this, we can conclude that the termination of the cooperation between Xingmei and Cat's Eye is not as simple as the expiration of the contract. It is not only an objective time node, but also an inevitable subjective decision. As one of the largest theaters in China, Xingmei has a huge and mature membership system. Seeing that e-commerce is interfering in ticketing and plans to share its cake little by little, Xingmei is naturally unwilling. So when the contract expired, Xingmei decided to reverse the situation, change passive dividends into active profits, take back the ticketing channels into its own hands, and get rid of its dependence on the short-term effects of e-commerce. Zheng Jichong revealed that in the half month after the cat's eye port was closed, Xingmei's ticket sales did not decline.

Future outlook: Reaching in-depth equity cooperation with Baidu is mutually beneficial. The model of shared member

e-commerce to seize the market with low-priced tickets has encountered bottlenecks?

Although the heart of e-commerce is now well known to everyone, in the Internet age, it is undoubtedly impossible to completely reject e-commerce. So why does Xingmei have the confidence to turn off Cat's Eye and Dianping's ticketing ports?

The answer is, first, Xingmei, as an established chain chain, has the strength to develop its own membership system; second, Xingmei has reached in-depth equity cooperation with Baidu, and both parties are mutually beneficial and share membership. Like the once-booming group-buying websites, e-commerce has encountered certain bottlenecks in its development and has begun to enter a transition period. In the past, the era when the market could be swept by simply relying on low-priced tickets is gradually fading away. Representative by the parting of Xingmei and Cat's Eye, theaters have begun to learn to say "no" to e-commerce. In the future, only joint-stock deep strategic partners will be the ideal relationship between e-commerce and cinemas.

Selling movie tickets was originally the responsibility of movie theaters, but now many viewers have already selected seats online in advance when they arrive at the movie theater. By introducing e-commerce to cinemas, is it just to gain profits or to quench their thirst? How to ensure the share that originally belongs to the movie theater? As early as when e-commerce was just popular and attracted widespread attention in the industry, cinemas had two different attitudes towards the joining of e-commerce. Studios such as Beijing Yaolai Jackie Chan Wukesong Store do not have particularly strong geographical advantages. They have made full use of the wave of group buying and e-commerce, and the number of movie-goers continues to rise, becoming the national box office champion studios; and theaters such as Wanda, UME, and Xingmei are located in a golden spot, have many cinemas, and have strong natural capital. They can fully develop their own ticketing websites and membership systems. Joining Xingmei members can get benefits such as discounts on ticket purchases and discounts on derivatives purchases. Xingmei's various membership cards have been launched for several years, attracting a large movie-watching audience. In an era when group buying was not yet popular, buying membership cards was the first choice for many veteran fans.

In June this year, Xingmei Holdings Group announced that Baidu, Hopu Fund and Tianan Property Insurance had invested a total of HK$450 million in Xingmei Holdings. Baidu spent HK$150 million to obtain a 1.59% stake in Xingmei Holdings. Later, Xingmei and Baidu reached a series of agreements, including ticketing cooperation and financial subsidies. Baidu also provided many new technical support for Xingmei, such as map positioning and search, online crowdfunding projects, super theaters and future joint development products, etc., have rich sources of profit. Xingmei no longer just passively distributes ticket money, but has become an active income-generating party.

"The key point is that Xingmei and Baidu's members are shared, and both parties can guide each other. Xingmei already has a large number of members, and Baidu has undoubtedly more members." Zheng Jichong told Sina Entertainment. It is reported that after Xingmei and Baidu joined hands, the number of members has indeed increased considerably. In the upcoming National Day holiday, Stellar is expected to further accept the results of this measure.

Editor: vian