What is WeChat?
WeChat is a multipurpose, social media platform, that is used primarily across mainland China and has more than 1 billion monthly active users (MAU) according to Tencent. In the Chinese digital landscape, this is the most frequently used app. WeChat, which was launched by parent company Tencent, started primarily as a messaging app, however it has expanded to a platform where users are able to shop, play games, book hotels, read news and make payments amongst a growing list of other features. With a constantly growing figure of MAU, WeChat has become an essential tool for businesses to succeed in China.
Why is WeChat necessary for businesses in China?
Tencent’s Fourth quarter results of 2019 revealed that WeChat had more than 1.16 billion users. As WeChat’s user base continues to grow, so does its abilities and features, offering various means for businesses to gain even more direct access to their consumers. With key features such as ‘official accounts’, ‘mini programs’ and ‘service accounts’, businesses in China have an easy and direct communication line with their customer base.
One of the most attractive aspects for businesses is not only the high volume of MAU, but also who is using the app. Research conducted by Statista on the distribution of WeChat users in China in 2019 revealed that only 4.3% of users in China were over the age of 46 years old. The research further revealed that the highest amount of users was occupied by 25 – 30 year olds, at 28.3%. The analysis reflected that more than 60% of the users are aged between 25 – 40 years old, which presents a large group of consumers, who not only have significant spending power, but also with whom businesses can build strong connections with.
How can businesses use WeChat as a marketing tool
WeChat Mini Programs and Accounts
Considering the numerous facets there are to this super app, there is more than one way in which a business could benefit from WeChat. From mini-programs to service accounts to the use of key opinion leaders (KOL’s), marketers can be both strategic and creative in their approach. Here are some of the official account types WeChat offers businesses:
- Mini programs: These are sub-applications within the WeChat ecosystem, that can simply be described as apps within an app. Although these ‘apps’ have limited capabilities, correctly utilizing this feature, consumers can have easy access to your brand, while using WeChat. Mini-programs can be used to share information, run promotions and even act as an e-commerce platform.
- Subscription accounts: These types of accounts offer a great reach for businesses or brands to consumers. With this kind of account there is increased focus and opportunity for brand communication. Account owners can make 1 post per day and content can be re-shared by users with mention being made to the original publisher. However, there is a major drawback, which is that users don’t receive push notifications and the messages build up, like a spam folder.
- Service accounts: These accounts offer more advanced features to businesses wanting to use the platform. Through a service account, a business is able to open a WeChat store and even create mini programs. One of the most significant features is that a service account appears as a stand-alone contact (as opposed to subscription accounts where the notifications appear in the subscription folder). Therefore, if a business sends out a notification via a service account, a user directly receives a push notification. This feature does however have a limitation, as enterprises are restricted to a maximum of 4 posts per month.
WeChat and market research
It is critical for businesses to stay up to date and informed with what consumers want and need. Market research not only provides better understanding of your customers, it also allows for businesses to identify problems and look for solutions. With WeChat’s continually growing user base and the frequency at which the app is used, it is a great platform for businesses to have as a market research tool. Many businesses now use WeChat to get information from consumers, by conducting surveys across an array of different topics. Survey tools have responded by optimizing their software for WeChat, allowing for surveys to be shared easily and data to be collected efficiently.
WeChat and ad campaigns
WeChat has been established as a useful marketing tool in China, however, the way in which it can be used may differ according to the needs and preferences of the business. An enterprise may choose a direct ad approach or they may use it in conjunction with other marketing activations.
For businesses who opt for direct ad campaigns, WeChat provides various means through which a business can advertise, such as ads on moments, banner ads, ads through accounts and ads using KOL’s. Although this direct form of advertising can be rather costly, one could predict a considerable return on investment. With the colossal amount of data Tencent has stored on users, market segmentation has been simplified to the utmost degree, allowing enterprises to target users with an increased degree of specificity. Users are segmented not only on the usual targets such as age and gender, but also on interests and behavior patterns.
WeChat can also be used in conjunction with other forms of marketing. Calvin Klein, as an example, combined outdoor advertising with WeChat in an effort to increase sales. In August of 2016, during Chinese Valentine’s day, Calvin Klein displayed QR codes on outdoor digital billboards, with the purpose of getting pedestrians to scan the code and post a picture of themselves and their friends on WeChat. Within an hour, 808 people had scanned the code, 504 took a picture and 76 of those taken were displayed on the digital billboards. This campaign ended up increasing Calvin Klein’s sales by 50% from the same day the previous year according to an article by Luxion Media.
Connecting with customers
Considering how dynamic and competitive the market is in China, it is now more important than ever, that businesses focus on forming strong connections with consumers. WeChat provides the opportunity to increase trust, improve brand awareness and brand loyalty as well as engage with customers on a personal level.
An example of building a connection can be seen with the British luxury leather brand, Mulberry. In 2015 Mulberry launched a campaign for Qixi festival (Chinese Valentine’s day in August), where they encouraged overseas Chinese, to send a customized Mulberry ‘digital love letter’ to their loved ones over WeChat. Some lucky participants were then invited into stores, where their specific love letter earned them a personalized, handcrafted leather bracelet.
The Qixi festival is characterized of a story between two lovers, who had been banished to either side of a river, who were able to be reunited with the help of magpies, who formed a bridge for them to cross over the water. By embracing the legend, Mulberry had formed a deep connection with Chinese people around the world. Businesses considering entering China, need to consider the ways in which they can build this connection, as close engagement with consumers could determine the success of their brand in China.
WeChat is one of the most important and useful tools for any enterprise entering the Chinese market. It is important for businesses of all sizes, to unlock the potential WeChat has to offer, by strategically utilizing the marketing tools in line with their respective needs and priorities. Being strategic and creative with the use of WeChat could be a key factor in determining the success of your brand in China.