CEO Tips · Overseas Expansion Season | How Can Overseas Short Dramas Make Money with "Domineering CEOs"?

"The popularity of 'Bossy CEO' spreads globally. Are foreigners willing to pay for 'vulgar' content? With a monthly income of nearly 100 million, who is making money overseas? What are the new ways to play with brand-customized short dramas?"

At 7 p.m. on Thursday, October 17th, the 36Kr Live Studio invited Su Xing, the head of the Short Drama Division of Meetsocial Group, and Lancy Wu, the Investment Director of MPU (FlexTV), to join us and discuss: How can overseas short dramas make money with "Bossy CEO"?

The main focus of this live stream is on the following issues:

1. What are the main types of players in the current short drama market? How do you view the relationship between online literature and short dramas?
2. Who are the target audiences for overseas short dramas, and what are the differences in regions and themes compared to domestic short dramas that mainly target the lower-end market?
3. What are the difficulties in the localized adaptation of short dramas going overseas, and are there any commonalities in rhythm and script?
4. Do the two of you think that shooting North American dramas must be done in North America, and how to deal with the cost pressure of actors?
5. It is said that 2% of hit dramas create more than 70% of the revenue. Do you think there is a methodology for hit short dramas?
6. Facing the high cost of traffic investment, how should platforms and producers formulate their delivery strategies? What are the differences in users on different platforms?
7. What standard should the return on investment (ROI) of short dramas reach to achieve small-scale profitability? What are the concentrated demands of brand-customized customers at the level?
8. What do the two of you think about the future market space of short dramas and what else can be shot?
9. The overseas short drama market is not yet saturated. Please give three pieces of advice to enterprises planning to enter the market.

The following is the conversation between the two guests and 36Kr, and some of the content has been sorted and edited:

36Kr: What are the main types of players in the current short drama market? How do you view the relationship between online literature and short dramas?

Su Xing: First of all, the players are mainly divided into three categories. One is the overseas expansion of online literature. The audience of this type is highly similar to that of short dramas going overseas. The difference is that the text is transformed into consecutive images. Another type is companies that were originally engaged in film and television production. They have film and television production resources and capabilities, noticed the heat of the overseas short drama market, and went overseas based on their own capabilities. In addition, some game companies have also begun to transform and produce short dramas. The form of short dramas is between games and short dramas, and it is interactive. The online literature team has accumulated a large number of proven hit IP scripts through data verification, and can use emotional commonalities and localized variables to attract traffic. Traditional film and television companies have many partners and localized teams worldwide and are experienced in shooting and production. They have also noticed the popularity of short dramas and entered the market based on their own advantages.

Secondly, short dramas and online literature cannot be completely equated. Compared with short dramas, the vitality of online literature is stronger. The payment cycle may last for one or two years, while once a short drama is shot into a video, few people will watch it repeatedly. The delivery cycle of short dramas is usually 90 days, after which there will be no more traffic, and there will be no second delivery. Short dramas are more like disposable short videos, and few will be rewatched after viewing.

Lancy: I think that a successful online novel may indeed be adapted into a successful short drama, but they cannot be directly equated. There are significant differences in the product forms of the two. Online literature is a long-form content that allows for detailed narration and expansion, and the evaluation criteria of users are based on storylines, plot smoothness, and excellent writing. In contrast, short dramas are a highly concentrated product that does not contain implications, metaphors, or foreshadowing. The plot and character rhythms are very fast, similar to the rhythm design of game payments. Adapting a long online novel into a fast-paced short drama requires professional screenwriting skills and has a high threshold.

When it comes to the investment in the short drama market, in fact, cultural content categories often have a counter-market effect. During periods of economic downturn, the consumer demand for cultural content increases instead. Short dramas are one of the very popular product categories in China in recent years, and the scale of the overseas short drama market has increased tenfold in the past few quarters. In terms of investment, it is mainly platform-led investment and co-investment. Currently, the market has entered a stable development stage, and more players tend to cooperate for development to reduce risks. Professional teams with vertical screen experience and directors with a methodology for hit content are more likely to receive financial support. These teams have previously produced excellent works and are more favored by investors.

36Kr: Domestic short dramas mainly target the lower-end market. Who are the target audiences for overseas short dramas, and what are the differences in regions and themes?

Su Xing: For the North American market, themes such as "Bossy CEO," "Tormented Love," and "Counterattack" are very popular, emphasizing female liberation and affluence, mainly attracting female users between the ages of 25 and 45. Some themes such as werewolves and vampires are also not to be ignored. They are the main themes in the local characteristics and myths of the North American region.

The competition between domestic and foreign short drama producers and the market is fierce. In China, users have not yet fully developed the habit of paying for content. It may not be possible to cover the upfront investment costs only through payment, so derivative monetization methods and channels are needed. The brand customization method is currently mainly targeted at the domestic market. Specifically, there are two main methods: First is brand naming, where the name of the drama or the main scene is associated with the brand; second is brand placement, where the product appears in the plot or the lead actor mentions the brand name in the voiceover. Domestic brand placement, naming, and slice monetization are already quite mature. Well-known beauty brands and short drama companies have a very close cooperation, and whether it is transitioning to live streaming or promoting products, it is carried out very smoothly. Mainly because the domestic short drama market, live streaming market, and the maturity of product monetization, the infrastructure is complete, forming an interlocking industrial chain. However, the overseas market is still mainly focused on the content payment link, with a strong content monetization ability, and has not yet developed to the next variant.

Lancy: First of all, the Southeast Asian market is a market that we entered earlier and achieved good data performance. The Southeast Asian market is actually similar to the domestic market. The female frequency user age group is between 20 and 40 years old, and users consume entertainment content in their fragmented time. Unlike the European and American markets, there are currently more "male frequency" contents in Southeast Asia. In my understanding, the "male frequency" in the current European and American markets has not been fully developed, and many hit works are still to be explored. However, the Southeast Asian market has a large user base, but the user's payment habits and willingness are not as good as those in the European and American markets. Therefore, we mainly focus on the English-speaking market dominated by North America.

Secondly, the differences in the content distribution patterns at home and abroad are very significant. Some large domestic short-video platforms and WeChat mini-programs have established mature distribution channels, allowing users to conveniently distribute content. In contrast, the overseas market is still in the early stage. We start from independent C-end product apps, which have a high platform product value. Overseas users are accustomed to paying in independent channel apps and products, such as Netflix and other platforms, which all adopt a subscription payment model. In addition, on our own platform, the product can better conduct user and content operations, including new content gameplay and interactive designs, with a more flexible product form.

36Kr: What are the difficulties in the localized adaptation of short dramas going overseas, and are there any commonalities in rhythm and script?

Lancy: First of all, local dramas are the focus of our investment. Local dramas are more likely to produce hit content with a higher ceiling. When it comes to difficulties, returning to the content level, localization and cultural identity are major challenges. Perhaps a large amount of data has been accumulated in China, including popular elements such as tormented love and counterattack. We can apply this core to the production of English dramas in North America to improve the winning rate and the audience's acceptance of the content.

Secondly, in terms of themes, if a theme is popular, everyone will rush to imitate it, which may lead to audience aesthetic fatigue. In terms of production, overseas production is more challenging than domestic production. It is necessary to solve the problem of the localized team, and there is also a problem of ensuring that the goods are in line, to ensure that the team can accurately understand and execute the project. The domestic team is very familiar with the product characteristics, rhythm, and tone of short dramas. If the overseas team is not familiar with short drama products, the domestic team and producers need to grasp it to ensure the smooth landing of the product.

In addition, the script is the basis for the success of a short drama. It is best to have a dedicated team to conduct market research, understand the pain points and market segments of users, select IPs or stories with hit potential as the blueprint, and then carry out innovation and script creation. We have our own screenwriting team and will also use external scripts. Once the project is determined to be feasible, we will match the project with the appropriate production team and director based on factors such as the theme, style, region, and actors.

Su Xing: There must be commonalities. As the old saying goes, "There is nothing new under the sun." Themes related to "Bossy CEO," "Tormented Love," and male-female emotions are the same for users worldwide. We just extract the commonalities and present them in the local cultural environment in a way that locals can understand. The core is to distribute the concentrated conflicts at each payment point. The faster the rhythm and the more eye-catching it is, within one and a half to two minutes, it stops abruptly at the exciting point, and then pushes the next episode, and then embeds the payment point.

In terms of the script, we mostly cooperate with the top copyright owners with content IPs because they have a very rich content accumulation. When selecting the script, our cooperation method with the copyright owner is similar to a 50-50 split. The copyright owner may provide us with ten scripts. Our screenwriters and producers, most of whom have lived overseas for many years, have a deep understanding and background of the local culture. They will re-examine the core elements of the domestic script from the perspective that locals can understand, and the adaptation intensity may be as high as 50%. This includes adjustments from character names, scenes, props to some concepts. For example, the custom of bride price in China does not exist overseas. Therefore, we need to translate and adapt the cultural elements, not just the text.

36Kr: Do the two of you think that shooting North American dramas must be done in North America? How to deal with the cost pressure of actors?

Lancy: We have tried in different regional markets. Generally speaking, the effect of shooting locally in North America is definitely good. The actors' accents and the richness of options are relatively high, but the cost in North America is indeed rising rapidly. Recently, everyone is also looking for alternative solutions in other regions. The advantage of Southeast Asia is that the work efficiency is high, the cost is lower, and the theme shooting is relatively more free, but a comprehensive balance needs to be made in the selection of actors. In terms of actor costs, in our short drama model, this part is relatively fixed. Similar to domestic short dramas, basically, a hit drama can make the actors popular. But the audience does not watch a short drama just because a well-known popular actress is starring in it. Short dramas mainly depend on the plot, and the reliance on the actor's popularity is not great. Usually, if the actor's schedule and price are significantly different from our budget, we may choose other actors. Of course, there are also some long-term cooperative actors. For example, if they are a perfect match for our character settings or have established a good relationship and CP sense with the audience in previous hit works, we will consider them comprehensively.

Su Xing: First of all, from the perspective of delivery, it is best to produce content in the target country or region. Because the user experience is very important, British and American accents can be easily distinguished in an English-speaking environment. If the audience can identify the source of the content through the accent, the degree of content acceptance may be discounted, which will affect the intensity of conversion and payment. Therefore, most North American dramas choose to be shot in North America. However, the competition in the North American market has intensified recently, and the fees for directors, actors, and venues are all rising. Despite the new entrants, the excellent production resources are still relatively concentrated, especially in Los Angeles and New York. Excellent directors have become a scarce resource, and their schedules are tight, and the prices naturally rise. Therefore, we are also actively developing resources in other countries or regions to achieve the global scheduling of film and television resources and a comprehensive evaluation of the plan.

Secondly, in terms of actors, there are not many well-known short drama actors in the overseas market, so this problem is not that serious. It is worth noting that if the same actor appears in multiple dramas simultaneously and these dramas are released at the same time, the effect may not be good. Therefore, our delivery team will suggest staggering the release time to avoid the same batch of lead actors appearing continuously at the same time. This sounds like a paradox. We make an actor popular through multiple dramas, but we cannot let him appear frequently. This is the point that we need to balance in delivery and content production. Overall, the requirement for short drama actor IPs in the overseas market is not high, and the fan effect has not yet been generated. In addition, short dramas are a delivery behavior closely related to the delivery cost. We will not delay for two months just to wait for an actor.

36Kr: It is said that 2% of hit dramas create more than 70% of the revenue. Do you think there is a methodology for hit short dramas?

Lancy: First of all, the script is the most core part, which is the consensus of all short drama practitioners in China. However, to create a hit short drama, a complete chain project is required. In addition to the plot design and story presentation, there must also be actors who fit the character settings and are liked by the audience, as well as a high-level production, precise rhythm control, material editing, and delivery strategy. Every link cannot go wrong, which is the prerequisite for creating a hit. In addition, to improve the success rate on this basis, it is also necessary to deeply study the successful cases in different markets, such as the domestic or Southeast Asian markets. We can test these cases in other countries for data. In this process, it is also necessary to deeply study the population of the target country and produce content solidly. Finally, the birth of a hit short drama may also contain some metaphysical factors.

Su Xing: First of all, I think there are indeed similarities and so-called "metaphysical" factors between overseas and domestic hit dramas. Because all the variables in the delivery are changing over time, nothing is constant. The hit dramas of each company are based on their own advantages and are difficult to replicate. The term "hit" itself is a post-flow judgment. For example, some dramas have good exposure and viewership, but the paid conversion is not good; some are the opposite, with good paid conversion. Therefore, we need to comprehensively evaluate where the key points of a hit are and infer why it is popular from the production perspective. This is indeed a bit metaphysical.

Secondly, when it comes to the shooting level, we will also find that technical issues such as lighting and sound recording in the picture will affect the audience experience. Post-dubbing and sound effect processing are also crucial. If the post-sound effects in China are used, it will make overseas audiences feel strange, because users in each country have different perceptions of sound effects. If a certain production link is completed by a domestic team, overseas users may sensitively perceive that this is not the culture of their country, thereby affecting their willingness to pay.

Therefore, when reviewing, we will disassemble each link very meticulously and follow a very strict standard operating procedure. From the actors' clothing, makeup to the scenes, everything should be localized. For example, we will choose the shooting location according to the theme. The weather in the UK is often gloomy, while Los Angeles is sunny. Therefore, for the theme of "Tormented Love," we may choose to shoot in London, where the weather is more suitable for creating an emotional atmosphere; for the theme of "Sweet Love," we may choose to shoot in Los Angeles because the beautiful scenery of the sunny beach is suitable for this kind of plot. In general, there are many factors contributing to the formation of a hit, and we just use professional knowledge to increase the probability of a hit, but no one can guarantee that it will be successful.

36Kr: Facing the high cost of traffic investment, how should platforms and producers formulate their delivery strategies? What are the differences in users on different platforms?

Lancy: First of all, our delivery is mainly handled by our own team, who have rich delivery experience. From the decision to shoot a drama, they will consider from the delivery end, such as which materials in the script setting can be used for delivery, and the entire production chain is very complete. Taking overseas short-video social media platforms as an example, the