Additionally, we are tailoring game promotions, operations and commercialization strategies for game developers based on each game’s specific development stage. To facilitate more effective execution of our plans and amplify the scenery of our core strengths , we began an organizational restructuring at the outset of 2024, particularly within business units related to our content ecosystem. We used to structure our content ecosystem business units around individual gaming projects with distinct teams under each business unit managing streamer operations, events and activities, and game developer cooperation. Our restructuring has enabled us to shift away from game-based operations and consolidate fragmented resources associated with gaming segments.
Our internal communication channels are now more streamlined, allowing us to amplify our platform’s collective strength. In short, our goals this year are to enhance compliance while improving content quality and the user experience. We are committed to diversifying revenue streams and continuously optimizing costs and expenses. In doing so, we can stabilize and promote long-term healthy platform growth amidst the continually evolving market dynamics. Thank you.
Operator: Excuse me, Lei Zhang, are you done with your question?
Lingling Kong: Yes, next question, please?
Operator: The next question comes from the line of Raphael Chen with BOCI Research.
Raphael Chen: Foreign Language I’m just wondering how does the management team evaluate the impact of some top-tier content games, such as Honor of Kings and League of Legends, being branded to stream on DouYu platform? Thank you.
Lingling Kong: Thank you, Rafael. So the user base of China’s Internet and gaming sector is near saturation. In response, starting last year, Internet platforms started pivoting away from traditional traffic acquisition methods. Instead, they have been prioritizing core business operations and competitive strengths, improving operating efficiencies and foster cross-platform collaborations. So cross-platform content sharing is emerging as a strategic trend. We have actively embraced the trend of open content. We have focused on our core strengths to fortify business fundamentals, also diversified our business scope and models. Being mindful of competition risks while seizing diverse opportunities, we have been actively innovating our content offerings and fostering cross-platform collaborations.
In addition to producing differentiated and appealing content integrating our streamers’ unique characteristics, we also explored cooperation avenues with other platforms to expand our content ecosystem, launching joint promotions and collaborative initiatives powered by the premium content features on our platform. For example, we have been progressively piloting on partnerships with other platforms based on each party’s top-tier exclusive streamer resources. We’ve been working on great complementary content synergies offering eSport live streaming users more premium content and more convenient viewing options. Additionally, in the second half of 2023, we started piloting content promotions on WeChat channels with selected streamers. These enabled streamers to sync their live streaming content on WeChat channels to improve their content visibility.
Given the vast user base of short video platforms, we might encounter certain challenges in the short-term, particularly potential downward pressure in MAUs this year. We have proactively addressed these risks by leveraging our strengths. As part of our primitive measures, we deepened our operation around the gaming needs of our core users, including consistently rolling out high-quality content and operational activities and updating product features to fulfill diverse user needs. According to our data analysis so far, despite MAU declines, our platform’s core user behavior matrix remained relatively stable. Moreover, leveraging insight from our prior commercial collaborations, marketing campaigns centered around game prompts, including limited time sales during live streaming sessions and regular game membership services that not only contribute to revenue diversification, but also foster new user acquisition while deepening existing user engagement.
Moving forward, we will continuously explore more operational models to solidify our core user base and to pursue opportunities to propel growth across our platform. Thank you. Operator, next question, please?
Operator: The next question comes from the line of Derek Tse with Morgan Stanley. Please go ahead.
Derek Tse: Foreign Language Thank you.We noticed that the company has made significant progress in the non-live streaming revenue in 2023. And you just mentioned earlier that diversifying revenue is one of the key focuses. Could you please share more details about the plans and the goals for the upcoming year?
Hao Cao: In 2023, advertising and other revenues surged by 135% year-over-year with its revenue contribution increasing from 4.4% in 2022 to 13.2%. This remarkable growth was driven by revenues from our new revenue-generating models. Capitalizing our strengths in gaming content operations since 2022, we have been exploring diverse avenues for commercialization beyond the traditional virtual gifting model. The robust growth of gaming membership business and certain smaller innovative initiatives, such as our voice-based social networking service, both contributed to other revenues in 2023. In 2024, we plan to dive deeper into commercialization directly related to games. Given that the majority of our platform’s core users are gamers, there is a clear demand for game prompts and new games which closely aligns with our platform’s gaming content.
Firstly, we will bolster and broaden the scope of gaming membership business, aiming to expand this service to more game genres. We plan to unveil new revenue-generating products and marketing strategies tailored to distinctive characteristics and player needs. Secondly, we will ramp up our focus on performance-based game promotions. We intend to pivot away from streamer-sponsored product placements and gradually transition to performance-based promotions, such as cost-per-sale model. Streamers will have the flexibility to select new games for promotion based on their expertise and audience preferences. The CPS model has been operational for some time now, yielding promising results with conversion rates surpassing market averages. Furthermore, our other smaller innovative businesses have shown promising momentum and are now making revenue contributions.
