Keep: located in the fast-growing track of fitness, the closed-loop business model is combined with rich fitness content / social tags to realize the retention and Realization of user traffic
Keep is a leading enterprise in China's online sports and fitness platform. The number of monthly active users and monthly subscription members far exceeds that of peers. With the gradual improvement of Chinese residents' health awareness, the increasing demand for spare time sports of young groups and the government's encouragement of national fitness, the online fitness platform has ushered in new opportunities for development. According to the burning knowledge consulting report, the penetration rate of online fitness crowd in China will reach 45.5% in 2021 and is expected to reach 57.4% by 2026; In 2021, China's online fitness market reached 370.1 billion yuan, which is expected to grow to 895.8 billion yuan in 2026, with a compound growth rate of 19.3%. The online fitness market has large growth space, and the growth space of industry leaders in the future can be expected.
Keep's business model covers the right fitness life cycle. The company's three business lines of online fitness + Intelligent fitness equipment + supporting sports products complement each other. Online fitness content brings traffic to private brands, and private brands also introduce traffic to online fitness content. Different sectors give full play to synergy and improve the operation efficiency of the platform.
The company's revenue performance is brilliant, and the sales of private brand products account for a high proportion. The company's revenue in 2020 was 1.106 billion yuan, a year-on-year increase of 66.9%; In the first three quarters of 2021, the revenue was 1.159 billion yuan, a year-on-year increase of 41.3%. From January to September 2021, the company's revenue from private brand products / member ordering and online paid content / advertising and other services was 639 / 380 / 140 million yuan respectively, accounting for 55.1% / 32.8% / 12.1% of the total revenue, an increase of 33.57% / 52.46% / 51.04% compared with the same period last year. Member ordering and online paid content, advertising service fees and other services were the pillars of the company's revenue increment.
Content + community builds the company's core competitiveness. The company provides iterative and updated fitness courses and training planning services. At the same time, the company integrates fitness and social tags to encourage users to share fitness experience and further enrich the keep ecosystem. Keep also makes "talent" and circle recommendations for users through its own algorithm mechanism to prolong the retention time of users, Further enhance user stickiness.
The portrait of the company's customers is clear and the retention rate is very high. In 2021, the average monthly active users of the company reached 34.36 million, of which 74.1% were aged 30 and below, and the average retention rate of core customers in the 12th month reached 49.3%. Among the monthly active users who provide location information, an average of 52.2% come from China's first tier, second tier, new first tier and new second tier cities. The company plans to expand its business to low-level cities and other age groups through diversified products. The forward-looking strategy is expected to stimulate the company's new vitality.
The company's net profit has not turned from loss to profit, which is mainly due to the company's increased expenditure on user acquisition and brand promotion. In the first three quarters of 2020 and 2021, the company's gross profit margin was 46.9% and 42.6% respectively, the sales expense rate was 27.3% and 70.6%, the net profit margin was - 178.5% and - 212.0%, and the adjusted net profit margin was - 9.58% and - 60.05%. The company is in the early stage of operation. In order to increase brand awareness and stabilize the first mover advantage, the company has focused on user acquisition and brand promotion in recent years, and made further efforts in this direction in 2021. Therefore, the sales expense rate is at a high level in recent years and increased significantly in 2021.
The funds raised by the company are mainly used in four directions: 1) product innovation and R & D and upgrading of the company's technical capacity; 2) Fitness content development to meet diversified customer needs; 3) Brand publicity and promotion; 4) General corporate purposes and working capital needs. Product innovation, R & D and upgrading of technical capacity. The development of fitness content will help to improve the operation efficiency of the company, provide better services for existing customers and increase the retention rate, while brand publicity will help the company cover more user groups.
This week's view
The government work report emphasizes a number of key development points to inject a booster into the social service section that is gradually recovering under the background of the accuracy / dynamics of the anti epidemic strategy. We suggest paying attention to the four main lines of the recovery logic: 1) It is recommended that Zhejiang Ssaw Boutique Hotels Co.Ltd(301073) , Shanghai Jin Jiang International Hotels Co.Ltd(600754) , Btg Hotels (Group) Co.Ltd(600258) , with strong demand toughness and cycle reversal in sight, and it is recommended to pay attention to Huazhu group; 2). Recommend the tax-free faucet China Tourism Group Duty Free Corporation Limited(601888) ; 3). The 14th five year plan for tourism and the relief policy for the service industry have brought substantial benefits to the scenic area. It is recommended that Jiangsu Tianmu Lake Tourism Co.Ltd(603136) / Songcheng Performance Development Co.Ltd(300144) , and China Cyts Tours Holding Co.Ltd(600138) / Fosun tourism / Mount Emei A / Huangshan Tourism Development Co.Ltd(600054) ; 4). Catering and tea will develop well driven by multiple factors such as the warmer weather, the peak tourism consumption season and consumption promotion policies. Helen company is recommended. It is recommended to pay attention to jiumaojiu / Naixue tea / Haidilao / sipping sipping. 5). The flexible employment security policy is improved, and the human resources industry is moving towards standardization. It is suggested to pay attention to the leading human resources service leader of digital / platform transformation Beijing Career International Co.Ltd(300662) . 6). The state has taken many measures to stabilize employment, and the vocational education sector may become a driving force. It is suggested to pay attention to Offcn Education Technology Co.Ltd(002607) / Jiangsu Chuanzhiboke Education Technology Co.Ltd(003032) / Shanghai Action Education Technology Co.Ltd(605098) / China Education Holdings.
Risk tips
Macroeconomic fluctuation risk; Repeated outbreaks exceed the expected risk; The risk of intensified industry competition; The landing of new projects / products is less than the expected risk; Food safety risks; Risk of major teaching accidents
