Xueqing Zhang: My question is related to paid membership business. The membership business once again demonstrated strong growth this quarter, so could the management share more details about the reason behind it, and how should we think about this business in the long-term? Thank you.
Zhou Yuan: Thank you for this question. Well, it was three years ago, since we are beginning to launch our membership program. And up to here now, you see our membership growth is faster than our expectation at the very beginning. We believe that the demand for the paying for the premium content is still there and will remain resilient for a long time. And it corrects as a matter, only relies on the supply of the good content that we’re paying for. And we believed our entire community serves as a supplier for great contents. And that is why you see that we have entered into a very good cycle of supply and demand for premium content was paying for. And as a result, you could see that our membership business started off with losing money, and now it’s getting more and more sustainable in driving profit and also to the net profit we have as a whole community.
Our membership growth is a healthy and a fast one. And as you can see our high quality content and high quality content creators are the main drivers for our membership business. And the third quarter our membership content creator €“ member content creator had an increase of 40% year-over-year and the income per member creator increased by 29% year-over-year. And our most popular YanPlus content column had an increase offering of over 130% year-over-year. And this popular content has transformed more new members to us. For the third quarter, our monthly paying users is over 10 million, and as of September effective paying user number is over 11 million. And we see that this number keeps increasing and we think that these had provide very good driver force for paying members both in and outside of the website.
And so far we haven’t seen any sign of slowing down of member growth. And I €“ we think that this is thanks to the momentum that we cultivated through our community content based business model. We do value €“ the value created by our content creator YanPlus to our community. And in the past three years, the cap creating high quality content for us. And we just launched our Supernova program for the next three years, as mentioned by my colleague, Mr. Sun Wei, that we had hit this year’s target ahead of schedule. So with our next three years program, we hope to create more content creators with revenue over RMB1 million. And we hope that more people can join us and benefit from our platform for more close and read word. Our membership business actually is emerged from our ecosystem and it’s ever growing size proved again that our member paying system from premium content based on community screening is really powerful and highly potential for the meet long-term, I think that our membership business will not be limited to the community growth.
We think that premium content is attractive across the internet, and there is this general growth of willingness to pay for premium content as a general trend across our industry. And this will help us to further grow our membership growth in the long-term for the future.
Operator: Thank you. And our next question today comes from Ashley Xu with Credit Suisse. Please go ahead.
Ashley Xu: I’ll interpret, I’ll translate by myself. My question is related to the ADS and the CCS revenue. What’s the driver of third quarter decline and how is the fourth quarter outlook? Could management provide more color by different verticals? Thank you.
Jingjing Du: Thank you very much for this question. The answer comes from our CFO Mr. Sun Wei.
Sun Wei: Well, thank you. Overall speaking in our third quarter demand decreased €“ slightly decreased from the ADS and CCS. This is mainly due to a weaker market environment as a whole and also a struggling environment due to COVID. I think overall speaking, if you compare advertisement and CCS as a whole, our CCS business remained more resilient against a struggling environment compared with traditional advertisement business. So they’re rather resilient and they only had a single digit decrease. . Okay. Overall speaking in our key and strength sectors, the results remain positive, especially in IT, 3C, automobile and games. They all registered year-over-year increase. And IT, 3C, automobile and games are exactly the strength areas that we have in our community and also in our content offerings.
So that in a way proves that our content and our community are really popular amongst the users as well as the merchandisers on CCS area. Okay. And if you refer to the specific approval we get from our merchants, they’re spending per paying client still increased by five percentage points year-over-year even with a weaker macro environment. So this proves that we are still trustworthy method of marketing and we keep gaining market share even despite some headwinds in the entire economic backdrop. Okay. By way of attracting and gaining market share against this market headwinds, we try to iterate our product from the lab IP series to cheese platforms to tree planting. We’ve tried various ways of marketing to showcase the brand so as to bring longer lasting and sustainable marketing values for our client.
And I think this has been proven by our results and also in our premium content in our CCS product. Okay. Our advantage that based on the commercial product, based on the premium content and community has always been our competitive advantage. And for the long term, this will remain so for the future. So when the market comes back, when the consumption recovers, we will be able to go back to a fast growth track due to our advantageous position in CCS and gain more market share in the marketing world. Okay. As for the look-out for the fourth quarter we believe that we will register a double-digit growth, but compared with the high base in the fourth quarter of last year the €“ to be business for advertisement in fourth quarter will probably be still subject to the COVID situation and the weaker economic environment.
As for the projection in the 2023, I think it pretty much depends on the macro economy as well as the COVID policy evolution. So we’re keeping close eye on those market situations. But so far we are not able to make an accurate prediction as to what will happen next year.
