From Internet Cafe to Internet Cafe： Social Feelings of Boys Born in 1980s

Editor’s note: As a friend of the post-80s generation, Qian Zhenzhen often has such confusion: Why does my girlfriend/wife always let me choose between the game and her? Faced with such confusion, Qian Truth showed them the way: Why not open an Internet cafe together?

As a post-80s generation, Qian Zhen witnessed the earliest "little black room" LAN bar (the cost is 1-2 yuan/hour, and the game is mainly StarCraft), and after 2000, the smoky Internet cafes (the cost is 4-6 yuan/hour, and the game is mainly Warcraft, CS), and now the Internet cafes (the cost is 10 yuan/hour, and the game is mainly Dota2).

Unfortunately, just as Qian Zhen’s friends were gearing up to prepare for the Internet cafe, Wangyu Internet Cafe got 210 million yuan in financing in 2017, and now even Jay Chou has rushed into this market and opened a "most luxurious Internet Cafe in history".

Who will grasp the social feelings of boys born after 1980s in the future? Let’s take a look at the dialogue between "Three Sounds" and net fish, and the market conception of net fish for internet cafes.

The following content comes from WeChat WeChat official account: Sansheng (WeChat WeChat official account ID: tosansheng), the original title "Rebirth of Internet Cafe: This is a story about consumption upgrading and scene redefinition.",author: Wang Xueqi.

"There are 140,000 Internet cafes now, and it will probably be less than half by the beginning of next year, and we are waiting for the downturn of the industry," said Peng Cong, head of the brand department of Netfish Internet Cafe Market, when asked by Sansheng how to use the 210 million D round of financing just obtained at the beginning of this year.

Net Fish Internet Cafe is the first heavy investment in the entertainment capital market in 2017. On January 26th, Wangyu Internet Cafe announced that the company had completed 210 million RMB Series D financing, and the investors were Dachen Venture Capital, Yicun Capital and Mingjia Capital. Previously, Wangyu Internet Cafe has completed three rounds of financing, and the investors include Lianzhong Games and Shunwang Technology. In September 2015, Netfish also received tens of millions of RMB Series B financing from Wang Sicong Pusi Capital.

In fact, the meaning boundary of Internet cafe has been rapidly enlarged. Searching for "Internet cafes" in the map has nearly 500 search results in Beijing alone, and many traditional Internet cafes that were once "messy" are also trying to make a comeback after a makeover.

However, this is not just a simple story about Xiao Fang, a country girl, who changed her name to Miss Dong after she entered the city. Behind the resurrection of Internet cafes and the rise of Internet cafes, hundreds of billions of game industries and more than 50 billion e-sports industries are making efforts to support it. At the same time, it is also the upgrade of offline social needs of a new generation of young consumers and the redefinition of certain Internet scenes.

Although e-sports and socialization have enabled Internet cafes to find their core competitiveness in the new era, which has attracted a large influx of capital, the current growth of consumer groups seems to be insufficient to carry the influx of Internet cafes.

As a result, the pioneers of the Internet cafe industry have invested in brand building and marketing promotion after earning the first bucket of gold. This revived traditional industry is attracting new players, but the old players have sharpened their swords and prepared for a big fight.

Starbucks is the goddess of inspiration for Internet cafes.

The bar in the Internet cafe looks more like a cafe.

Walking into the storefront of Netfish Internet Cafe near Beijing Workers’ Stadium, the spacious foyer makes it look like a large KTV at its peak many years ago, while the bar at the end of the foyer is more like a cafe, and the menu is also a standard cafe configuration. In addition to coffee juice, there is also a simple meal of pasta and rice. On the glass counter, even a certain brand of seaweed jar was carefully displayed.

Probably this snack is being promoted recently, and Net Fish Internet Cafe has also specially launched a package of seaweed and milk, which allows you to surf the Internet for free at a specified time after purchase.

The computer area of Wangyu Internet Cafe is also very different from the traditional Internet Cafe, which adopts a circular layout similar to a ladder classroom and puts all-in-one Apple machines. Apart from the cries of "Don’t bid farewell" (note: warning teammates not to die) and excited shouts from time to time from the private room, there are few people in the lobby on weekdays. The clerk wearing a white shirt printed with the net fish logo stops to watch the game from time to time and often exchanges some experiences with consumers.

The earliest Internet cafes in China appeared in about 1995 and began to develop rapidly around 2000. In that careless era, Internet cafes were not a safe place for parents, and there were a large number of black Internet cafes that lacked business qualifications. After the 2002 Blue Speed Internet Cafe fire and the 2003 SARS, the government began to tighten the supervision and licensing policy for Internet cafes.

At the same time of policy tightening, the popularity of personal computers and smart phones has also quickly separated the popularity and traffic of Internet cafes. Once they have a free choice, it is becoming more and more difficult for young people to accept the dirty and chaotic Internet cafes that are shrouded in smoke. Several executives of Internet cafes told Sansheng that the Internet cafe industry in China began to enter a trough in 2010, and 2012 was probably the lowest ebb.

Faced with the overall decline and near elimination of the industry, some internet cafes in it began to actively seek new ways out. In this process, the global coffee chain brand "Starbucks" unexpectedly became the common goddess of inspiration.

Xu Hua from the brand department of Jiela Internet Cafe said in an interview with Sansheng that Jiela’s earliest attempt at Internet Cafe originated from a Starbucks consumption by her boss. Starbucks was very popular in 2010, and the boss felt that we could do the same as Starbucks and be a little more elegant. In 2005, Net Fish Internet Cafe was inspired by Starbucks when it tried to improve the environment of Internet cafes and added new leisure elements, because the latter "has access to the Internet, is quite comfortable, and has food and drink".

Compared with the pioneers of the transformation of Internet cafes such as Gera and Netfish, Bidou Internet Cafe, which rose in Guangzhou, started from another road. Fan Lihan, one of its founders, told Sansheng that Bidou first started from restaurants targeting college students and developed cultural and creative products. The purpose was to get involved in the campus market from different angles, turn himself into a university traffic portal company, and then realize the traffic through cooperation with other brands.

However, the restaurant belonging to "diligent" is unstable in profit and complicated in management. As a result, in 2016, they turned their attention to the "lazy" Internet cafe that has been in full swing. Fan Lihan likes to compare the Internet cafe industry to a parking lot. "As long as we solve the problems of qualification and location, we can get very stable profits and low management costs."

The current mode of Bidou Internet Cafe is to directly purchase Internet cafes that have been in business for many years through capital operation, and then upgrade and transform them into Internet cafes. In this respect, Bidou has certain innate advantages. Guangzhou did not have a large-scale chain Internet cafe before, which also means that Bidou does not need to face the experienced and powerful old landlords in this market.

Gera in Hangzhou, Wangyu in Shanghai, Bidou in Guangzhou, old players and newcomers in the Internet cafe industry are actively capturing different hills of Internet cafes in their own different ways.

E-sports is the specific medicine for the revival of Internet cafes.

"Coffee" is the source of inspiration for the return of the transformation of Internet cafes, and the shot in the arm for the real survival of Internet cafes is e-sports. For young game users, e-sports is not only more competitive in content and feeling, but more importantly, this new competitive event, which emphasizes teamwork and interaction, has fundamentally changed the offline social function and consumption scene of Internet cafes.

E-sports was officially recognized as a sport by the State Sports Commission in 2003. Although it also produced a number of star players, the limited number of competitions and immature business models have not attracted real capital favor for the e-sports industry.

After the game industry has reached a considerable scale, the e-sports industry began to take off. According to the data of the Game Working Committee of China Music and Digital Association, the market size of e-sports industry was 22.63 billion yuan in 2014, and it has more than doubled to 50.46 billion yuan two years later. Several operators of Internet cafes said that with the entry of Wang Sicong, Tencent and other capitals, e-sports began to become the development trend of the industry in 2012 and became a capital hotspot in 2015.

Another important change also occurred around 2014, and the state began to take more active encouragement to the e-sports industry. Xu Hua told us that Gera began to lay out e-sports based on the suggestion made by the Vice Minister of Culture when he visited in 2013.

Internet cafes are the direct beneficiaries of the booming e-sports industry. It is e-sports that makes people brought home by personal computers and smart phones go out of their homes again. For ordinary players, although e-sports competition is not a daily standard, "team competition" is a basic demand.

According to "Three Sounds", consumers around the age of 30 are the main force of opening black rooms (note: opening black rooms and playing games in Internet cafes). They have enough spending power and are more eager for offline social interaction.

Peng Cong said that the emergence of two phenomenal games, Dota2 and League of Legends, was an important turning point in the revival of Internet cafes. Although before them, there were also hot games in Internet cafes like Legend and Warcraft, the direct antagonism of Dota2 and League of Legends and the need to form a team are stronger, which can arouse people’s interest in playing in Internet cafes.

Compared with other e-sports events, "Dota2" and "League of Legends" offer higher individual event prizes, and the champion prize of "Dota2" even exceeds that of Wimbledon. With such a big prize, it will naturally attract more professional players to participate in the competition, and the hot atmosphere of the professional arena will eventually infect ordinary players.

E-sports has brought transformation opportunities and new growth points to Internet cafes, but it has also brought covetous competitors. More and more hot money has begun to pour into the Internet cafe industry-the country of hardware manufacturers and players has started to make Internet cafes, and Gome built its own Internet cafe brand Xiaomei Internet Cafe at the end of 2016. Former members of E-sports team WE have opened Internet cafes, and even the famous singer Jay Chou has joined the Internet cafe battle.

In 2014, the Ministry of Culture, the State Administration for Industry and Commerce, the Ministry of Public Security and the Ministry of Industry and Information Technology jointly issued No.41 and No.42 documents to improve the management policies of Internet cafes and promote the transformation and upgrading of Internet cafes, which lowered the threshold for opening Internet cafes, and the model of Internet cafes was easy to copy from the perspective of space design and equipment. Xu Hua said that the homogenization competition between Internet cafes is very serious.

Peng Cong also said that since the second half of 2016, the Internet cafe industry has entered a new round of survival of the fittest. A large number of Internet cafes that follow the trend obviously lack the ability to cope with fierce competition. Many Internet cafes can only attract customers through hand-to-hand combat methods such as price reduction and large-sum rush.

In his view, the market capacity of the Internet cafe industry is relatively limited. Although the number of e-sports users in China increased slightly in 2016, reaching about 130 million, Internet cafe consumers only accounted for a small part of it. In contrast, the supply of all kinds of Internet cafes blooming all over the sky was also in excess of demand. What’s important is that the two Internet cafe engines, Dota2 and League of Legends, have also begun to enter a period of exhaustion. "The market needs new games, and we are also waiting for the next end tour of Dota2 and League of Legends."

Under the realistic market situation, Internet cafe brands that already own the hills have begun to prepare more ammunition and put it into the next round of elimination war.

"What do Internet cafes do for promotion? Can they afford it?"

This is a question raised by Peng Cong, a native of 4A Company, when he first met with Huang Feng, the owner of Netfish Internet Cafe.

For Internet cafes before the transformation, marketing and brand are still two very distant words. At that time, as long as we had a good position, a computer that was not too bad, and more tolerance for minors’ fake ID cards, the business of Internet cafes would soon get better.

However, when the black Internet cafe model lost its stable audience and the Internet cafe model fell into fierce competition, marketing and brand became one of the key factors to win in the new stage.

In the storefront of Netfish Internet Cafe, in addition to the large portrait of the spokesperson Angelababy, there is also the ubiquitous brand logo cartoon killer whale. Gera Internet Cafe invited Miss, the queen of e-sports, to speak for herself, and also cooperated with Running Man by providing venues. In contrast, Bidou Internet Cafe, whose start-up team is good at marketing, continues the cultural and creative genes and designs its own brand image.

In addition to VI (corporate visual design), internet cafes have also made great efforts in the interior design of their stores. The style design of each store of Netfish is different. Compared with the bright wind of Netfish Internet Cafe, Fengdie Internet Cafe, another brand of its Internet Cafe, has many female users because of its warmer overall color and more casual decoration style. Bidou Internet Cafe, which aims at college students, hopes that the storefront image will be more positive and sunny, so it adopts a yellow-green tone.

In addition to the establishment of brand image at the visual level, holding e-sports competitions and actively seeking cross-border cooperation are also the focus of Internet cafe marketing. Bidou Internet Cafe held the Guangzhou University E-sports Goddess Challenge, which turned "watching girls play games" into a marketing event with great communication value. Gera and Netfish will also hold daily competitions in the store.

According to Peng Cong, when Netfish Internet Cafe holds a national e-sports competition, there will be 33 teams in just one store.

Net Fish Internet Cafe is spending more of the money it has melted on linkage with other brands, so as to establish its own differentiation and recognition. Some time ago, Banana Plan held the BIG Carnival in Shanghai, and the net fish Internet cafe also participated in it, and set up its own e-sports stage.

At the same time, the net fish also began to pay more attention to investors’ resources other than money. For example, the acceptance of Mingjia Capital in the D round of financing was due to the influence of the boss Huang Xiaoming, which brought many star resources to the net fish.

In this marketing campaign, the old Internet cafes rely on strong economic strength, industry contacts and local resources, while the new generation of Internet cafes rely more on their own sense of smell and experience in marketing and the dividends that those who join the battlefield later have.

When it comes to how to get out of the Red Sea of Internet cafes, the three Internet cafes seem to have their own strategies. In Xu Hua’s view, as long as the game industry is still popular, the Internet cafe industry will definitely continue to survive. With the cooperation resources of big game manufacturers, such as the activation-free demo of some games and the privilege of all heroes and all skins, old-fashioned Internet cafes can still attract many players and franchisees. For Gera, the next upgrade will focus on the intelligent management of Internet cafes and the improvement of operation and marketing capabilities.

In Peng Cong’s eyes, the user-oriented concept and integrated management system are the unshakable core competitiveness of net fish. "Equipment can be copied, lots can be replaced, but services cannot." The integrated system ensures that net fish users can be used nationwide after handling the card, which enhances the user’s viscosity. The future planning of net fish still revolves around the game. "What we do is not an Internet cafe, but a multiplayer game space."

For Fan Lihan, on the road of branding, the Internet cafe industry in Guangzhou has just started, and it is better to stand firm in South China than to plan for the future. "There are hundreds of thousands of Internet cafes in China. In terms of market share, no Internet cafe enterprise has really started to run. They run in the Yangtze River Delta and I run in the Pearl River Delta."

A long time ago, Internet cafes carried the need for people to communicate with the outside world. There were brothers from game guilds, unspeakable videos and websites, and chat room users who had never met before. After personal computers and smart phones have changed people’s communication patterns, some people are willing to return to the more or less real world of Internet cafes.

Fan Lihan’s vision for the future of Internet cafes is a pan-entertainment space that can be consumed by pass. "Buy a ticket, want to play games with a high-profile computer, want to sing with KTV, and want to play billiards with a pool table."

The above is the article of "Three Sounds".

After reading it, Qian Zhen felt the same way about the following sentence:

Consumer groups around the age of 30 are the main force in opening black rooms (note: opening black rooms and playing games in Internet cafes). They have enough spending power and are more eager for offline social interaction.

And what will be the future format of internet cafes?

I don’t know how you feel after reading the picture below.