“The Boss” is popular all over the world, and short dramas have “unlimited money-making potential” overseas?

While domestic short dramas are booming, they are also developing in overseas markets. What changes has the “short drama going overseas” brought to the short drama industry? What are the future development prospects?

While short dramas are becoming increasingly popular in China, they are also flourishing in overseas markets across the ocean.

The trend of Chinese enterprises going overseas has extended from e-commerce, games, 3C products, and online literature in the past to short dramas now. "Chinese bosses conquer foreigners", from Japan, South Korea, Southeast Asian countries to the European and American markets, the world is obsessed with the rustic short dramas.

The number of short dramas going overseas is growing rapidly. According to SensorTower data, the total download volume and net turnover of the top short drama platforms in 2023 reached 28.23 million times and US$56.71 million, respectively, which is an explosive growth compared with 2022.

Guohai Securities' short drama overseas report shows that the overseas short drama market is expected to reach US$36 billion in the long term, using the short drama DAU*ARPPU measurement method. In comparison, iMedia Research predicts that by 2024, the scale of China's short drama market will exceed RMB 100 billion by 2027, and the overseas short drama market has greater growth potential.

However, unlike the domestic short drama market, the overseas short drama market started late and is still in the pioneering stage. At the same time, the number of players pouring in is also increasing, but most short drama production companies rely on the production fees of short drama platforms to make profits, and they earn "hard-earned money". There are no players who have become rich overnight. Even like the domestic short drama industry, many people have lost money because of short dramas. There are also popular short dramas overseas, but they are not as profitable as the popular domestic short dramas. So far, there has not been a recharge amount of over 100 million.

Since the "pioneer" Chinese online short drama platform ReelShort was launched in August 2022, short dramas have been developing overseas for a year and a half. In the past year or so, more people have entered the market, and the number of market players has doubled. With the tightening of supervision in the domestic short drama market, many people have shifted their horizons to overseas. Capital is also increasing investment in overseas short dramas. Many practitioners told Tech Planet that many overseas short drama companies have obtained financing.

Domestic short drama players are heading overseas to tap into overseas markets. What challenges do they face?

1. Overseas short dramas exploded, and the cost was 2-5 times higher than that in China

Xie Xiangwu, a producer of overseas short dramas, started shooting vertical screen short dramas in June last year. He has shot 7 short dramas in nearly a year, several of which became hits. The most popular short drama has received more than 3 million hits.

Most of the production teams of overseas short dramas are fresh graduates or small-scale teams. The teams are usually project-based and form temporary teams for filming. Xie Xiangwu's team is full-time employees, and the main creative team is relatively fixed.

Unlike domestic short dramas, the threshold for overseas short dramas is higher. The investment cost of a 50-100 episode short drama is about 80,000-300,000 US dollars, which is 2-5 times higher than that in China. There are almost no short dramas with co-investment (co-investment by the platform and the production company) abroad. Only the platform invests in localized teams to produce. The production company undertakes the platform's short drama production needs and only charges a production fee, with a general profit point of about 5%-10%. They do not directly participate in investment and operation, so the final click volume and payment situation of the short drama are not transparent.

Even the well-known hit short dramas "The Double Life of My Billionaire Husband", "My Forbidden Alpha", and "Never Divorce the Secret Billionaire Heiress" did not announce its final recharge amount like the domestic short drama "Wushuang".

There are many individual investors in short dramas in China, and of course, the risks are greater. The first wave of players lost millions and were forced out. The overseas market has not yet been fully developed, so there are relatively few big capital players investing in short dramas. Currently, the main players are platform companies such as Chinese Online and Jiuzhou.

The report "2024 Short Drama Overseas Market Insights" released by the third-party data platform Sensor Tower shows that by the end of February 2024, more than 40 short drama applications have been tested in the overseas market, with a cumulative download volume of nearly 55 million times and in-app purchase revenue of US$170 million. Among them, the ReelShort platform contributed 52% of the download volume and 48% of the revenue of the short drama overseas track, leading the short drama overseas players.

The production cycle of overseas short dramas is longer than that of domestic short dramas. The latter may only take one month from the script to the final release. Sometimes film and television companies will shoot multiple short dramas at the same time to save costs, so the average production time of a short drama is shorter. The production capacity of overseas short dramas is limited, and the production cycle of a short drama is about one and a half months or even 2-3 months.

Xie Xiangwu told Tech Planet that short plays going overseas are divided into two types: original and adapted. Original scripts will undoubtedly take longer. For adapted scripts, after purchasing the copyright from the platform, the pre-production takes 20 days, the shooting takes 5-12 days, and the post-production takes about 20 days, which adds up to a cycle of 6-8 weeks.

Many overseas short dramas are directly copied from mature domestic short dramas. The short drama routines such as counterattack, reversal, slapping, apology on knees, marriage first and love later are universal. Xie Xiangwu said that elements such as running with the ball, sadomasochism, and chasing the wife to the crematorium can be seen in overseas short dramas. The editing rhythm will also learn from domestic short dramas, with fast-paced editing and paid card editing.

Among the short dramas that are exported, translated dramas account for half of the market, and it is also the form with the lowest threshold for exporting to the overseas market. Domestic popular short dramas are directly translated and put online. Dianzhong Technology DramaBox has launched 300 short dramas, and translated short dramas account for more than 90%. SensorTower data shows that in February this year, DramaBox's revenue in the US market increased by 82%, reaching 72% of ReelShort, and the in-app purchase revenue was about 40 million yuan.

The cost of translating a short drama, if there are 100 episodes in total and each episode is 1 minute, is between 1900 and 3300 yuan. Youdao Translation staff revealed to Tech Planet that the translation fee for short dramas is by the minute, and the fees for different languages ​​are also different. The pure translation of English is 19 yuan/minute, the Japanese translation is 33 yuan/minute, and the Korean translation is 28 yuan/minute.

2. "Boss" is the most popular, but also not suitable for local conditions

The types of short dramas that users in the European and American markets like are: domineering bosses, werewolves, vampires, and gangsters.

Although many short dramas going overseas are copied from domestic short dramas, not all the secrets of hits work overseas. Some elements of hits will not work well in foreign countries if copied and pasted. Vegeta, a producer of short dramas going overseas in Chengdu, said that themes such as "son-in-law" and "god of war" are popular in China, but not very popular in the European and American markets.

Chloe, the person in charge of overseas short dramas, told Tech Planet that their team entered the short drama industry this year, and the first short drama unexpectedly became the second best-selling drama in North America after it was launched. Chloe said that foreign countries are more sensitive to gender equality and racial culture. There is still a certain contradiction between the "dominant boss" culture and the foreign cultural concept of pursuing gender equality. The essence of the "dominant boss" is an unequal economic relationship, and women need to rely on men. In this case, challenges will arise, and some overseas directors and screenwriters will explicitly reject such scripts that are not very friendly to women.

Therefore, even if the short dramas going overseas have the core of "dominant boss", they will be adjusted to a certain extent, that is, localized adaptation. Sean Zhao, founder of the overseas short drama company Production House 8, said that the parts that belittle women will be adapted, and the female characters will be adjusted to independent, self-reliant and opinionated heroines. In addition, short dramas going overseas, like domestic short dramas, will set up plot "hooks" to attract audiences and create reversals, but in terms of shooting techniques, they will emphasize the naturalness of the plot, will not create particularly exaggerated plots, and will also discard the vulgar parts.

Short play director Qu Kuan told Tech Planet that the biggest challenge in localizing short plays for overseas markets is the script. Qu Kuan's team started making short plays two or three years ago and tried to export them overseas this year. So far, their team has shot one short play for overseas markets, which was mainly shot in China and invited foreign actors to participate.

Qu Kuan said that overseas users are not particularly receptive to online writing and need to develop habits, so short plays should return to the formal film and television production system. In addition, local people with professional production capabilities, that is, white Americans, should be found to localize the scripts.

Short dramas going overseas need to put more effort into character creation. Cultural differences lead to different acceptance of short drama characters by domestic and foreign audiences. Domestic short dramas have already formed user habits. Even if the character of the "dominant boss" is stereotyped, unsmiling, suspended, and high-handed, the cold-faced boss can be well accepted and understood by everyone. However, North American audiences hope that the character of the "dominant boss" is more real, rich, and three-dimensional. He is not a purely cold-faced "dominant boss", but also has a warm and humorous side, and needs a sense of trust in the character. In addition, Qu Kuan also mentioned that the West does not accept women bearing humiliation, and they hope that female characters will be more independent and self-reliant.

The market for overseas short dramas is far less competitive than that for domestic short dramas, but the challenges are not small.

The high production cost of overseas short dramas is a good thing for the contractor, but they need to prove to the client why the cost is so high. Xie Xiangwu said that the three questions that the overseas short drama producers need to communicate with clients repeatedly are why the overseas market is more expensive than domestic short dramas, why the time limit cannot be exceeded, and why actors need longer time and higher budgets to perform intimate scenes.

The shooting time of domestic short dramas is 16 hours a day, which is very intensive. In the United States, the industry regulations stipulate that it cannot exceed 12 hours, and overtime must be paid 1.5 to 2 times the salary. If the crew is one hour late in serving meals, they must also pay a certain amount of compensation.

Intimate scenes require longer time and budget because there is a special intimate scene director position in the American film and television industry. Actors need to communicate with the director before acting in intimate scenes, so that the actors can prepare psychologically in advance. Communication means cost, which will affect the shooting progress. Xie Xiangwu told Tech Planet that the salary of intimate scene directors is very high, 350-500 US dollars for 8 hours. Similar positions include stunt directors and special effects production, which are also time-consuming and labor-intensive.

3. “The money is big”, but only a limited number of people will benefit

According to the securities companies’ predictions on the market space for overseas short dramas, the market size of US$37 billion seems to have “unlimited money potential.”

Overseas markets are indeed more willing to pay for short dramas, especially in Europe and the United States, where they can pay $25-50 for a short drama. At present, the profit model of overseas short drama platforms mostly relies on single-episode payment, and also attaches importance to subscription and advertising monetization. The price of a single episode of a short drama is about $0.5, which is twice as high as in China. Platforms such as ReelShort and DramaBox also set up weekly memberships, paying $19.99 to watch all content on the platform within a week. In China, it costs about 99 yuan to become a one-year member.

The cost of actors is relatively controllable. Several overseas short drama producers told Tech Planet that the pay of overseas actors is usually between US$300 and US$1,000 per day, while the pay of domestic short drama actors has risen to RMB 5,000 to RMB 15,000 per day.

There is more room for overseas themes, but the overseas short drama market is in its infancy. Xie Xiangwu said that the majority of people shooting short dramas are still Chinese, and American companies and teams have not yet personally participated. Teams shooting short dramas in New York, Australia, the United Kingdom, Canada and other countries are also just emerging. There are less than 10 teams in Los Angeles that can shoot good short dramas. Teams that pursue quality short dramas can only shoot one in a month or even two months, and the output is not high. "However, the mainstream American market has now also paid attention to vertical screen short dramas and started to forward vertical screen short drama content."

However, at present, even the leading short drama company Maple Leaf Interactive ReelShort, which has the first-mover advantage, is just burning money to make a name for itself. The financial report released by Chinese Online recently showed that its subsidiary Maple Leaf Interactive's revenue in 2023 was 686 million yuan and its net profit was 240,000 yuan. The profit margin of the short drama production company is 5%-10%, and the production fee of a short drama is only 30,000-100,000 yuan.

In addition, the industry's wild growth period is inevitably accompanied by some chaos, and the overseas short dramas are highly homogenized. Last year, werewolf themes were popular, and this year they returned to "dominant CEOs". According to Xie Xiangwu's observation, some platforms have begun to consciously adopt differentiation strategies, trying thriller, horror, youth campus, comedy themes, etc. However, the mainstream still takes the safe route, and short dramas tend to focus on the successfully verified domineering CEO themes.

Homogeneous short dramas will undoubtedly lower the overall market experience and easily cause users to become aesthetically fatigued with short dramas.

Some shoddy companies even began to appear in the market. Most of them were fresh graduates without much experience. A team of one or two people formed a team, and the quality of the short plays they produced was not very high.

Many domestic short drama teams have also smelled the business opportunities of overseas short dramas and mainly shoot overseas short dramas in China. Qu Kuan revealed that in order to earn the contract fee, many short drama teams will find some foreign actors from Eastern Europe, Russia, Africa and other countries to star in the short dramas and complete the shooting in China.

However, this practice has caused great harm to the market and lowered the overall quality of short dramas. "Although the overseas short dramas focus on the North American market, they also radiate to other English-speaking countries. People in English-speaking countries find it difficult to accept racial confusion. It's like Hollywood gave us a Chinese-narrated story, but the actors are all Japanese and Korean. This is very unfriendly to us."

Although the overseas short dramas are in an explosive period and growing rapidly, the number of people who really benefit from them is still extremely limited. However, all practitioners of overseas short dramas are full of confidence in the future, "it is only a matter of time before they surpass domestic short dramas."

Author: Zhai Yuanyuan

WeChat public account: Tech Planet