Research On LeTV's Full Industry Chain Profit Model

In today's era,the online video industry has sprung up and caused tremendous social changes.It not only brings convenience to people and enriches people's entertainment life,but also provides businesses with new marketing channels and platforms.With the rapid development of the online video industry,the competition for video sites has become fierce.Almost all major video sites have not achieved real profits.The issue of profitability has become a thorny issue for the development of video websites.The online video industry in China needs to explore suitable profit-making channels.In the quagmire where the industry was deeply in the midst of losses and the profit model was traditionally single,LeTV broke through the predicament in 2012 and achieved profits for many years with its innovative "platform+content+terminal+application"all-industry-chain profit model.Profitability is extremely rare in the online video industry.However,in November 2016,the "levision crisis" that shocked the industry broke out.This meant that LeTV's full-industry-chain profit model had problems in continuous expansion and needed to be adjusted.In this context,based on the relevant theories of profit model,combined with the case of LeTV development,the financial report since LeTV Online was selected as the data source.The profit model of the entire industry chain of the company was analyzed in depth and profitable from LeTV.com.The structure,profitability,profitability,cash flow,and debt repayment ability are all analyzed in an all-round way to the profit model of LeTV.com's entire industry chain,exploring the problems existing in the profit model of LeTV.com's entire industry chain and the causes of the problems,and ultimately targeting the issues and the reasons given the corresponding improvement measures.Expect to play a reference role in the development of other video sites.The main conclusions of this study are as follows:1.Based on the analysis of the profit structure of LeTV,this article concludes that LeTV's profit structure is diversified and the business scope involved is vast.However,the profitability of each business itself is poor,and there is no synergy between each other.Therefore,the overall profitability of LeTV is insufficient,and its core competitiveness is not prominent.In addition,the cost of terminal services and the rewards received are not directly proportional to the profitability of terminal services,which lowers the profitability of LeTV.2.Based on the analysis of LeTV's profitability,this article finds that LeTV's profitability is weak.The small profit margin and the huge cost make LeTV's profitability suffer.Its profitability is at a disadvantage in the entire industry.LeTV will continue to adjust its profitability model,increase profitability,increase revenue and reduce expenditure,reduce costs and increase profit margins.3.Based on the analysis of LeTV's profitability approach,this article concludes that LeTV's entire industrial chain has a large ecological layout,but its distribution of resources is decentralized,its core competitiveness is not prominent,its profitability is limited,and some links even lose money,dragging down the entire ecosystem.The operation makes LeTV's entire ecosystem unable to achieve sustainable development.4.Based on the analysis of LeTV's cash flow and solvency,this article found that LeTV's cash flow was tight,a large amount of net cash inflow from financing could not keep up with the pace of frenzied investment,and the huge debt and profitability weakness made LeTV's solvency poor.High financial risk.Therefore,once there is a problem with financing,the capital chain will soon be broken.This is also the most fundamental reason for LeTV's current crisis in the capital chain.5.The problems caused by LeTV's profit model:First,LeTV's capital chain breaks.The reason is that LeTV has a high financial risk for its liabilities;secondly,its core competitiveness is not prominent and its profitability is poor.The reason is that the elements of the ecological chain are scattered and there is a lack of synergies in each link.Third,the sales of hardware are at a loss.The reason is the hardware low-cost pricing marketing strategy;Fourth,the high audit risk,damage to shareholders' equity.The reason is that the related transactions are mad,and the overlapping of various businesses has resulted in a high risk of recovery of accounts receivable.Fifth,profits have encountered bottlenecks.The reason is that it is difficult to balance the income of members and advertising.The increase in the income of members is determined by the increase in the sales of members.The increase in advertising revenue is determined by the number of non-members,and the two incomes are restrained.Based on the above research conclusions,this article proposes related suggestions to improve the profit model of LeTV.com,including:deepening the ecological layout,widening the financing channels;rationally allocating resources and building core advantages;actively exploring new profit points,improving terminal quality and content,and controlling related Trade,improve profitability;improve advertising model,reform the membership system.