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The WeChat phenomenon - Why you need to look at WeChat as part of your China Strategy

Based around a CNN article by Adam Skuse with additional content from Adrian Allen

Shanghai (CNN) -- The exchange of name cards has long been aubiquitous part of meeting new people in China.

But now it's increasingly likely tobe accompanied by the frenzied flourishing of smartphones, as the participantsadd one another on WeChat, the phenomenally popular instant-messaging app madeby the country's biggest Internet company, Tencent.

While name cards have yet to be completelysupplanted, many now also have a QR code which, when scanned into a mobile phone, adds the card's bearer asa WeChat contact.

The popular function is one reasonbehind the rise of WeChat -- called Weixin in Chinese -- which is unseating theTwitter-like microblogging platform Sina Weibo as China's dominant socialmedia

Once a lively forum for publicdebate that for a time wrong-footed Chinese censors, users are ditching Weiboas tightened government oversight takes its toll. WeChat's greater privacy andwider range of applications make it more attractive to users.

Abandoning Weibo

Ye Jun, a 26-year-old projectmanager in Shanghai, started using WeChat when she upgraded to an iPhone lastMay.

By that time, most of her friendswere already using the service, although she still preferred Weibo.

That changed in November, when shecaught the bouquet at a friend's wedding, and posted pictures of the event onher WeChat activity timeline which, like Facebook, allows users to share photosand status updates with their contacts.

"There were instant commentsfrom my friends. It was fun. I realized that WeChat was a better, moreeffective social networking tool than Weibo, which has been practicallyabandoned by most people."

The rise of WeChat and why it is important for Western businesses

WeChat was launched in early 2011,attracting 100 million registered users in its first 15 months.

This was in part due to Tencent'sability to promote the app to its huge base of over 800 million users of itsmany other services, including QQ, its desktop instant messaging client.

Tencent has also been quick inrolling out new versions of the app, adding features such as mobile payment,e-commerce integration, games, marketing accounts for brands, a taxi-hailingfunction and an online investment fund.

As more commercial functions are added WeChat will become an ever more popular way to promote and sell products. Chinese consumers are rapidly increasing their on line purchasing for a wide variety of products

Many were quick to gain traction in theday-to-day lives of users. A function that allowed people to give and receive digital versions of Lunar New Year red envelopes saw 20 million exchanged.

As of last September, when Tencent's mostrecent figures were released, WeChat had 271.9 million active monthly users, up124% from the previous year

With most Western social networking sites suffering from Chinese censureship, using a platform that gives access to millions of potential consumers in the worlds fastest growing economy should be seen as an essential part of a China marketing strategy. Anderen Ltd work with WeChat developers in China and organise social media management to support our UK clients

It will be interesting to see how hard Tencent iswilling to spend to win new users outside of China.

MarkEnglehart Evans, digital strategist

Posts made to Weibo are public, andtherefore can go viral in a very short time, while posts made to WeChattimelines are shared only with contacts, and there is no easy way to forwardthem.

Mark Englehart Evans, digitalstrategist and co-founder of Techyizu, a technology and entrepreneurshipcommunity in Shanghai, says this means the two platforms are not necessarilymutually exclusive, although a change does seem to be underway.

"Much like Facebook versusTwitter, there seem to be more than enough dual users, or at least people withboth apps on their phones. (But) monthly active users have certainly shifted. Iknow my Weibo app has gotten dusty," says Evans.

This shift is palpable whenspeaking to Chinese social media users.

"It is very obvious that fewerpeople are using Weibo, because I get less feedback when I tweet andretweet," says Duan Wuning, a 29-year-old media professional.

"WeChat status updates areprivate, so my friends and I prefer to post things about our daily lives there.I have to check WeChat every day to make sure I don't miss importantthings."

Going global

As Facebook announces its $19billion acquisition of WeChat competitor Whatsapp, the the question of WeChat'spotential for international expansion has come to the fore.

Tencent still faces huge challengesin going global. Its functionality could be appealing to users but questionsremain over what marketing approach the company will take for a product thatalready boasts a 100 million-strong user base abroad.

"This will be new for Tencentand very expensive," says Evans. "It will be interesting to see howhard Tencent is willing to spend to win new users outside of China, and if theycan scale up all its advanced features such as mobile commerce and banking toother markets."


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Registered in England number: 4514202 | VAT number: GB 900 7819 34 | Copyright © 2017 Anderen Ltd
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