On February 29th, Baidu released its performance announcement for the fourth quarter and full year of 2023, and also submitted its transcript of AI commercialization. According to the financial report, Baidu achieved a total revenue of 134.6 billion yuan in 2023, a year-on-year increase of about 9%, and a net profit of 28.7 billion yuan, a year-on-year increase of 39%.
Robin Lee, the founder, chairman and CEO of Baidu, said that ERNIE Bot, launched nearly a year ago, has enabled Baidu to gain incremental revenue, which will increase to billions of yuan in 2024. The search+consumption sector will be one of Baidu's heavy holdings, and Baidu, which has been obsessed with e-commerce for more than a decade, hopes to make new breakthroughs in the sales track through AI e-commerce.
Commercialization Transcript of Baidu Sun Yat sen's Heart Model
In March 2023, ERNIE Bot, a self research model of Baidu, launched the test invitation. In the following nearly a year, Baidu was exploring the whole business AI remodeling. In the financial report, Baidu also showed the year's report of Wenxin's big model. By the end of December 2023, the number of ERNIE Bot users has exceeded 100 million, and the daily call volume of Wenxin's big model has exceeded 50 million times, with an increase of 190% month on month in the fourth quarter; Baidu PaddlePaddle platform has attracted 10.7 million developers, who have created 860000 models on PaddlePaddle and served 235000 enterprises and institutions.
The heavy position of AI has also begun to be reflected in the revenue side of Baidu AI Cloud. The operating revenue of Baidu Intelligent Cloud in the fourth quarter of 2023 will be 8.4 billion yuan, of which the large model will bring about 660 million yuan of incremental revenue for cloud business.
Applications such as Baidu Search and Baidu Wenku are already undergoing AI transformation. The core mind of Baidu search is embedded in ERNIE Bot, and search results can also present generative content, realizing the parallel service of keyword search+generative search. From the actual effect, Baidu's dominance in the domestic search market has not changed. These undoubtedly have made a good start, and the AI business represented by the Wenxin Big Model will be an important way for Baidu to gain a premium in the capital market.
However, it seems that Baidu AI commercialization has not yet produced a killer profit project.
AI enables Baidu to find a new perspective to enter e-commerce
The end of the universe is carrying goods.
According to He Junjie, General Manager of Baidu Mobile Ecological Business Group, "Based on the traffic entry of Baidu App and Baidu Search, Baidu E-commerce has a unique advantage. The Baidu platform receives billions of search requests every day, and users are also engaged in content consumption and online transactions while searching for information. The e-commerce industry has become an important part of Baidu's mobile ecosystem."
Baidu foresaw the power of "search+consumption" for a long time and started doing e-commerce in 2007. In Baidu's previous e-commerce development history, from self built platforms to external investment, from comprehensive e-commerce to fresh e-commerce, from C2C to B2C, and connecting online and offline, Baidu's e-commerce exploration route is basically consistent with China's e-commerce development history, but it has been lukewarm for more than a decade.
In January last year, Wal Mart announced that it would cooperate with OpenAI to create an e-commerce search function similar to Chat GPT. Based on generative AI, AR and other technologies, Wal Mart launched a one button trial function on its social e-commerce platform. Under AI+everything, it is not difficult to understand that Baidu naturally regards AI+e-commerce as one of the key development directions.
In May 2023, just two months after the launch of the Wenxin Model, Baidu officially launched the e-commerce brand "Baidu Youxuan", attempting to leverage the power of AI to create a one-stop shopping decision-making platform for "search, push, and browse". AI elements are not only on the consumer side, but also on the merchant backend management and marketing tool side. Compared to the past, Baidu's e-commerce business has gone deeper.
Afterwards, Baidu held the "618 AI Shopping Carnival". The October Baidu World Conference also mentioned e-commerce business. At the 2024 Baidu "AI Refactoring E-commerce" Ecological Conference, Baidu Vice President and General Manager of Baidu E-commerce, Ping Xiaoli, announced Baidu's e-commerce performance report for 2023: Baidu Youxuan's GMV increased by 594% year-on-year, the number of transaction users and dynamic sales merchants increased by 4 and 3 times respectively, and the transactions facilitated by AI big models accounted for 20% of the total transactions.
AI+e-commerce has not yet seen a disruptive path
Baidu has also sorted out the intelligent advantages and personalized services of the "AI+E-commerce" new e-commerce: consumers can complete shopping operations more conveniently through intelligent voice interaction technology; Intelligent recommendation algorithms, e-commerce platforms can provide users with more personalized product recommendations; AI technology enables e-commerce platforms to gain a deeper understanding of users' interests, consumption habits, and preferences; AI intelligent customer service can provide intelligent answering services and provide 24-hour uninterrupted service. Baidu can also use artificial intelligence technology to optimize logistics distribution, warehouse management and other links, improve the overall operational efficiency and service quality of e-commerce platforms.
But in the current e-commerce environment, these technologies have not yet discovered many highlights, and traditional e-commerce giants are also exploring AI to enhance e-commerce. Alibaba is even considering not splitting its cloud business anymore, in order to empower e-commerce business with more intelligence.
On the practical application level, Taobao App has long been able to achieve homepage recommendations for thousands of people and faces; The recommendation algorithm of ByteDance is more familiar with human nature; Intelligent sorting and warehousing are not inferior to JD. As a result, despite Baidu Youxuan's rapid growth, it has not been able to provide a disruptive sales approach in the e-commerce field.
At the 2023 Baidu World Conference, it showcased the results of AI's restructuring of e-commerce business, mainly focusing on Hui Bo Xing and intelligent shopping guides. Among them, Huibo Star is a platform where merchants can use 2D real-life digital characters for live streaming, with high fidelity and convenient production of promotional videos. Intelligent shopping guides rely on large models to analyze user preferences and match consumers with more suitable products.
Although the above services can indeed improve the efficiency of merchants, Taobao can also provide similar intelligent shopping guide services. More importantly, for merchants, innovations such as intelligent shopping guide are non essential. At present, Baidu's AI+e-commerce is still more of a patchwork improvement in the existing e-commerce system, rather than a decisive step ahead of others in innovation. If you want to use AI to make great achievements in the e-commerce field, you need to be more cunning in terms of perspective.
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