(Yicai Global) Aug. 3 -- Consumers' taste is changing constantly, and popular short video bloggers can lose their online stardom very soon. They, therefore, are turning to multi-channel networks (MCNs) for help, a market insider told Yicai Global.

'Short videos' are video clips that last less than five minutes and are posted on new media via the internet. To monetize short videos, bloggers must become big names on social media sites and other similar media platforms first.

It is no easy feat for them to produce popular content that showcases their unique style. This is where MCN companies can come in and help. They act as artist managers and take care of blog design, traffic generation, marketing and client management, leaving bloggers to focus on content creation.

Shenzhen Hive Media is one such company. It has more than 300 short video accounts. Its team searches numerous social media sites to find and recruit bloggers with high potential.

"We design [development] paths tailored to individual bloggers, and help them adjust the paths as and when needed, because no one can be popular forever if he only creates a specific type of content," said Xia Qing, vice president at the company.

A manager at another MCN firm told a Yicai Global reporter that they spend over CNY10 million on Sina Weibo marketing every year.

Weibo is still the main marketing channel for video bloggers. Re-posts, likes and increase in follower numbers are usual indicators to measure the popularity of a given video clip, and how sticky it is.

Apart from 'cash burning' marketing operations, MCNs use big-name bloggers to train less popular ones. In any given vertical, there is usually a network of accounts that support each other but target different user groups, so that even if one of them 'dies,' the others can continue to generate traffic.

Different accounts have different priorities. Some of them are created to make quick money, while others focus on long-term growth. To retain those popular blogs, MCNs hire the bloggers as full-time employees, and thus become owners of their accounts. The bloggers are only paid a fixed salary plus commissions, and the companies always get the lion's share.

Some of the most popular bloggers can open local branches, which are invariably controlled by their MCNs. They may also find financiers for their work, and MCNs then become the earliest shareholders with minimum financial input.

As such, MCNs invest far more resources in big-name blogs with the most monetization potential.

"The 'head content' phenomenon is also clearly at play in [this business], and this type of content generates the most profit," noted Liu Daxiong, chief executive of Hangzhou Microidea Technology Co. Head content is that which is deemed the most reputable, the most influential and well-regarded. 

Bloggers with more than 10 million followers typically earn over CNY10 million a year, Xia Qing opined.

Yicai Global reporter learnt from several market insiders that advertising still remained the most fundamental and common source of profits in the short video business. Publishing a vivid ad on a Weibo account with around one million followers usually costs CNY10,000 to CNY20,000, and naming right and product placement are priced from CNY50,000 to CNY100,000.

Apart from commercial partnerships, becoming artists is another career path for video bloggers. "It is very difficult, because bloggers are stuck with a label that is very hard to erase," Xia said, adding that no MCN companies would help bloggers develop such a career path.

Monetization is another problem facing investors in short video businesses. The industry witnessed a sharp decline in the total amount of investment and funding that it received this year. Few funds are interested in short video businesses today primarily due to monetization difficulties, Wang Jieran, vice president at Fenghou Capital, told Yicai Global.

Venture capitalists generally prefer head content, but the number of suitable projects is relatively small, because many big-name bloggers opted to start their own companies last year. Besides, the overall valuation of 'generic content' has been on the decline this year.

"It's very difficult for new projects to be successful on the market today," pointed out Fan Weifeng, founder of GaoZhang Capital. "An increasing proportion of older projects secured series A and series B funding, but they have not gained monopoly, and the overall market concentration is not very high. Next, we'll see fast movers acquire slower ones and major players swallow smaller ones. After strong traffic growth abates, differences in content quality will become much more visible."