On New Year's Eve in 2024, a man was booed by the audience at Yi Pedestrian Street in Shijiazhuang, Hebei due to the temporary cancellation of a drone show, and finally knelt down to apologize. The incident sparked widespread discussion. The kneeling incident during the drone performance seems to have become a metaphor for the development of the drone performance industry. Drone performances are no longer as spectacular and eye-catching as they were when new species were born in the past. There is a trend of decline in both volume and gimmicks.
Although in terms of quantity, drone performances are still in the expansion stage. According to the statistics of the "2022 Cultural Tourism Industry Drone Formation Performance Data Insight Report", before the outbreak of the epidemic, the drone performance market ushered in a period of rapid growth. Even in 2021, there were 7,228 domestic drone formation performances.
However, the price of drone performances has clearly witnessed the industry's journey from its highlight moment to its "fall from the altar". In the past, the price of a drone performance was about 10,000 yuan, and a performance of 1,000 drones required a budget of 10 million. But now, the price of a drone performance is only 200 yuan from an unknown company. A thousand drones performing a show only cost 200,000.
From 10 million to 200,000, the price of drone performances has shrunk significantly, which has also witnessed the ups and downs of this subdivided track.
Price cuts, aesthetic fatigue, drone performances have fallen from the altar
How popular were drone performances in the past?
City governments and cultural tourism projects are willing to spend tens of millions of yuan to hold a 15-minute drone performance. Grand events such as the Spring Festival Gala and the Olympic Games also like to include drone performances.
There is an industry consensus circulating in the domestic drone field that drones are only made by DJI and others. However, the drone performance market is concentrated on the four small dragons of Shenzhen Gaoju Innovation, Shenzhen Damo Dazhi Control, Guangzhou Ehang Intelligent and Tianjin Yifei Intelligent Control. DJI does not make formation models. It is understood that these four companies and their service providers account for more than 90% of the domestic drone performance market.
Leading companies usually like to strive to create industry benchmarks and set new Guinness records. GaoJu Innovation set four Guinness World Records in 2021 with a fleet of 5,200 drones. A businessperson from EHang told Tech Planet that in addition to setting a Guinness record in 2018, EHang also built 10,000 drones in 2023. But the digital gameplay of simply setting records is not very meaningful. In the end, someone still needs to foot the bill.
Whether it is the "Four Little Dragons" in drone performance or a relatively small drone performance company, the price of a single drone performance is declining.
In 2018, drone performances are in full swing, and the simultaneous performance of 1,000 drones has become a difficult benchmark case in the industry. Of course, the price is also benchmark. A drone performance accident in Xi'an accidentally made the price of the drone performance public. Public reports show that in 2018, 1,374 drones in Xi'an performed in formation at the south gate of the Xi'an City Wall, displaying images such as the Xi'an City Wall, the Silk Road, and the 40th Anniversary, setting a Guinness World Record for the "largest number of drones performing". However, the graphics during the performance were garbled and the car overturned seriously.
Afterwards, the media broke the "Announcement on the Transaction of the Drone Performance Project of the Thousand Drones Light and Shadow Festival at the Spring Dance of Xi'an City Wall" published by the Procurement and Bidding Network. The announcement showed that the supplier of the transaction was Ehang Egret, and the transaction amount of the performance project was 10.5 million yuan. The average price of a drone is as high as 7,642 yuan.
Today, 6 years later, according to EHang sales, the price of one EHang drone for performance is 1,000-1,200 yuan, and the price can be lower if there are more units. The price of purchasing a drone is about 8,000 yuan. For the same price as a previous performance, you can now purchase a drone directly.
Unknown small and medium-sized drone performance companies charge lower prices. Wang Lei, a person in charge of the drone performance business for 5 years, told Tech Planet that the drone performance business is only one of their more than 20 businesses. Their company is headquartered in Guangzhou and has an execution team of more than 30 people for the single drone performance business.
In terms of costs, drone performances have different prices in different cities and on different dates. Compared with southern cities, northern cities such as Northeast China, Shaanxi-Gansu-Ningxia, and Tibet are more expensive. On holidays, prices are higher than on weekdays.
Wang Lei said that the largest performance they did in 2023 was in Wenzhou, when 2,000 drones were used and the fee was 600,000 yuan. A drone is equivalent to 300 yuan. In the past few years, their drone performance flight fee has been 800-1,000 yuan per unit.
Drone performances were most popular in 2018-2019. Wang Lei recalled that although the early technology was immature and drones dropped and patterns were garbled during performances, there were relatively few players at that time. There was a certain technical threshold for drone performances, and the public was also more concerned about this high technology. Nowadays, drone performance technology is becoming more and more mature. Drone crashes are almost rare and have become normal flights, but everyone is already visually tired.
Who still pays the bill? Incline towards personal consumption scenarios
In the drone performance market, early customers are mostly government activity projects. The Xi'an drone show that overturned in 2018 was ultimately funded by local finance.
Now, cultural tourism projects and scenic spots have gradually become the focus of the drone performance market. Data shows that drone performances in cultural and tourism scenic spots will account for as much as 36% of the market in 2021. One of the Four Little Dragons, Damo Big Technology's main business is to meet the needs of cultural tourism. It has already settled in more than 50 domestic theme parks and attractions such as Zhuhai Chimelong Ocean Kingdom, Guangzhou Chimelong Resort, Beijing Gubei Water Town, Huai'an Westward Journey, etc., and its market share in the theme park segment has reached 62.5%.
Many scenic spots have even begun to purchase their own drones to normalize drone performances. EHang Business said that in order to normalize drone performances, many scenic spots will purchase drones from them, and then EHang will provide certain technical guidance to the scenic spot staff. A drone costs about 8,000 yuan, and the cost will be recouped after just a few flights to the scenic spot.
The scenic spot uses drone performances as a "gimmick" in an attempt to attract more tourists. A netizen who went to Gubei Water Town to watch a drone show on New Year’s Day said that such performances are held in Gubei Water Town during major holidays. I waited for a long time to see the drone show that day, but later due to signal interference, the scenic spot informed everyone that the show was cancelled.
In addition, drone performance services are increasingly tilted towards personal consumption scenarios. It can be said that drone performance companies have witnessed the changing process of their customers. Several heads of drone performance companies told Tech Planet that most of the drone performance activities are now government and cultural tourism scenic area projects. Real estate companies and car companies are also among the customers of drone performances. In addition, there are many personal proposals, birthday shows, and fan support scene projects.
Chen Yang, an employee of a drone performance company in Guangzhou, said that his company has been involved in the industry since 2016. The company has now grown to dozens of people and performs more than 100 drone performances throughout the year. Each performance is usually 15 minutes long from takeoff to landing. Among them, there are about 5-6 orders per month for drone performances in personal consumption scenarios.
The competition among drone performance companies is fierce, and everyone can only make differences in drone models, stability, and customized images. Chenyang Company’s drone performance services generally provide customers with 12-15 patterns and screen customization opportunities. The demand is constantly escalating. Some customers have requirements for the duration of the performance and hope that the performance will be longer. Chen Yang said that this demand can usually be met, but due to the consideration of unexpected risks, it cannot be extended for too long, and it can be extended to 16-17 minutes at most.
Whether it is a cultural tourist attraction or an individual, everyone hopes to minimize the risk of accidental drone performances. In this case, drone performance companies usually sign a contract with customers, with a non-takeoff rate of 3%. Then, in order to ensure the take-off scene, staff will be sent to the site in advance to survey.
In the drone performance projects he has participated in in the past, Chen Yang said that large-scale events usually require 1,000 drones, which cost almost 230,000 yuan. The most common ones are 500-600 drone performances. The number of drones used in personal scenes is relatively small, usually 200-300. The drone performance of a personal proposal scene usually requires 50 drones for one word, and 300 drones for the six words "name + marry me".
Are drone shows a good business?
Data shows that as of the end of 2022, there are 15,000 drone operating companies across the country, with an annual output value reaching 117 billion yuan, 950,000 registered drones, and about 386 million real-time drone flights.
Drone performances, using artistic creation, light up a city time and time again, bringing visual feasts to the public. But from a business perspective, is it a good business?
The drone performance business was originally an unexpected attempt by a frustrated person in the cold winter of the industry. No domestic drone company can shake its position as the industry's No. 1 drone. Investment in the industry has waned, companies cannot obtain financing, and they have fallen into a life-and-death dilemma. In desperation, the company began to look for new ways out. When destocking, it unexpectedly caught up with the market demand for drone performances. Orders have been pouring in since then.
EHang is one of the leading companies that entered the drone performance field earlier. Hu Huazhi, founder and CEO of EHang, said in a previous interview that it is indeed difficult to make a good profit from consumer drones. The company used thousands of drones in stock to engage in formation business, which unexpectedly generated considerable profits.
The drone performance business once reversed the unprofitable situation of EHang's consumer drones. The development of flight formations "completely exceeded the company's expectations." The annual performance revenue was even expected to exceed 100 million.
In 2019, EHang entered the capital market. Its prospectus shows that in 2018, its aerial media business with drone performances as its core generated revenue of 31.3 million yuan, accounting for 47% of total revenue.
However, after listing, EHang failed to maintain its past growth rate. EHang’s financial report shows that in 2022, EHang achieved total revenue of 44.32 million yuan, compared with 56.81 million yuan in the same period last year, a year-on-year decrease of 22%; net loss was 329.3 million yuan, compared with 313.9 million yuan in the same period in 2021. Net loss attributable to the parent company was 328.2 million yuan, compared with 314 million yuan in the same period last year, a year-on-year increase of 4.54%. Adjusted net loss (non-GAAP) was $206.2 million, compared with $198 million in 2021.
The drone performance business has also been gradually marginalized during strategic adjustments. An EHang employee told Tech Planet that EHang’s main business now is manned unmanned aircraft, and its drone performance business is relatively marginal. Business customers are even a little uninterested in consulting drone performance. A consumer who has contacted EHang Business said that when he inquired about EHang's drone performance business on a Friday, their business asked the customer to add them on WeChat, and then said that they would only be able to provide customers with relevant flight performance cases and prices on Monday.
Another leading drone performance company also doesn’t take its customers very seriously. The above-mentioned consumers said that Tianjin Yifei Intelligent Control is also very neglectful towards customers, and they do not seem to be in a hurry to win orders for customer drone performances.
Domestic low-price drone performance revenue seems unable to meet corporate operating costs. Coupled with fierce competition among companies, leading companies have begun to expand overseas markets. EHang Business told Tech Planet that due to the impact of the epidemic, the company began to extend its tentacles overseas. Now that overseas business revenue has increased, demand is huge. Overseas customers like dynamic 3D shows that fly from point A to point B, while domestic customers prefer 2D shows more.
Prices abroad are also higher. The price of a single drone performance is more than 3,000 yuan, which is three times higher than in China.
In the short term, drone performances can be regarded as a revenue-generating business for drone companies. But in the long run, with the normalization of drone performances, the audience will become increasingly tired of aesthetics. Without differentiated drone performances, the living space may become smaller and smaller.