CooTek Looks Ahead to Rapid Growth in 2021 Thanks to New Partnerships and Key Strategy Shifts

The following post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga

After taking a hit in 2019, CooTek made a strong recovery in 2020, reporting a 238% year-over-year revenue increase in its most recent earnings call. CooTek had to make big changes and reexamine the core drivers of its success in order to make that recovery, and the numbers prove the company's success. 

The source of this growth comes from a rebalancing and refocusing of its product portfolio, as well as a renewed commitment to use its powerful AI and data-driven systems to improve user experience across its platforms. With these changes, CooTek expects to see its shift in strategy continue to pay off throughout 2021.

Fengdu Novel is the Key Driver of CooTek's Growth

According to its quarterly earnings call last December, CooTek has reaped the rewards of the development and expansion of its online literature business. Already ranked 3rd in the Chinese market, the company has attracted a large base of Chinese writers to build up a database of Chinese language books on its online literature platform. This is part of its global expansion of the platform, which has been successful in China. 

Through Fengdu Novel's AI and data-driven system, both platform users and authors can benefit from constant feedback. The average DAUs of Fengdu Novel exceeded 10.0 million in October 2020, with user average daily reading time of more than 130 minutes for the same period. The more users read, the better the AI identifies the best recommendations for their next book. Authors can learn from reader activity and preferences to write books that better provide what their core readers want. 

As a result of this innovative application of algorithms, CooTek has been able to drastically increase user retention rates as well as time spent in the app. That expansion is expected to continue with the announcement of Fengdu Novel's collaboration with key content partners in China in an effort to expand its book inventory and consolidate the Chinese market.

CooTek also plans to develop this content further into audio, film, television, and animation—a move that will attract an even broader audience and help it reach its growing Chinese-speaking user base.

Big Changes in CooTek's Scenario-Based Apps and Mobile Games

CooTek's scenario-based apps and casual games are largely limited to the domestic market in China for now, but the company is working to tap into international and U.S. markets.

In 2021, investors can expect to see a shift from more casual, short-cycle mobile games toward mid-core games that require more user skill, strategy and a longer life cycle. This shift is in response to the growing popularity of more strategy-heavy games, and the move should help CooTek attract a larger, more consistent base of international users. 

CooTek will also consolidate its scenario-based apps to focus largely on sports and fitness—2 areas that boast the most consistent growth. The company plans to add new functionalities to its existing products.

They are focused on their development of new apps and increasing engagement in existing apps, all with the goal of building a larger user base. 

The preceding post was written and/or published as a collaboration between Benzinga’s in-house sponsored content team and a financial partner of Benzinga. Although the piece is not and should not be construed as editorial content, the sponsored content team works to ensure that any and all information contained within is true and accurate to the best of their knowledge and research. This content is for informational purposes only and not intended to be investing advice.

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