Why WeChat is so popular in China

It’s interesting to download the preferred communication tools when dealing with global clients such as Viber for Israel or WeChat for China. Almost every client from China prefers to use WeChat as the main communication tool.

WeChat had 762 million Monthly Active Users (MAUs) as of Q1 2016. It added nearly 200 million MAUs in the past year.

Infographic: Number of WeChat MAUs 2011 - 2016, source: Statista 2016

While the general perception of WeChat is an instant messaging (IM) service similar to WhatsApp, Tencent, the company that developed WeChat, has gone one step further to incorporate its own social media platform, similar to Facebook, in the app.

Why WeChat is so popular in China?

Simplicity

WeChat’s active users rely on it heavily for their daily life from information search, sharing, e-commerce, social media, personal finance to book a taxi, or reserve a table at a restaurant. It is so easy to use that my 73-year-old dad uses it on a daily basis.

Simplicity - Registration

The majority of people have a phone and a phone number.  It’s so convenient to register with WeChat. A phone number equals to your WeChat ID. For those people who do not want to disclose their phone number, they can customize their WeChat ID (-a combination of texts, numbers, and symbols.)

Simplicity - Communication

WeChat was one of the early predecessors that you don’t need to type, but simply click the “hold to talk” button and hold while you chat with your friends (voice chat). (see picture below)

Picture: WeChat hold to Talk function

WeChat has a large emoji bank. Besides the regular emoji bank that you can find on Facebook, it also has some very creative and animated images shown in the following picture. This makes the chat more fun.

Picture: WeChat Emoji Bank sample

WeChat Red Packet Marketing

WeChat also created an alternative platform to approach potential customers and maintain customer relationships. Some innovative ways of marketing are worth to share:

Chinese red packet is a monetary gift given during the festivals or special occasions such as weddings and graduation ceremonies. WeChat developed a function called WeChat Red Packet - the digital version of the Chinese red packet.

The WeChat red packet has been used at least in the following 3 ways by marketers and business owners:

1. Attract potential customers to sign up as a user or increase # of followers.

2. Encourage followers, group members to participate in a given marketing campaign.

3. An alternative way of advertising.

One good example of WeChat advertising is CCTV`s New Year’s gala WeChat red packet campaign. The gala is the largest live entertainment event on Chinese New Year’s Eve with an estimated audience of 700 million+ on average. According to People.cn, 5 companies sponsored the gala in 2015, 20 million yuan each ($4 million Canadian dollars). Each WeChat red packet contained 2 yuan, which means 10 million people received the red packet depending on how fast they follow the company’s WeChat. This campaign not only increased the television ratings of the gala, but also grew the # of new followers for those participating companies.

WeChat red packet is a revenue generation channel for content marketers as well. If people like your article, picture, and/or video, they can “打赏” or send you a red packet.

Picture: WeChat Red Packet sample

Closed-loop Ecosystem

WeChat knows how to influence customer’s behaviours and has created a closed-loop ecosystem that includes the whole business value chain from product search, payment, delivery status checking, and product reviews.

For businesses, once you link your bank account with WeChat Pay and create your WeChat account using a QR code, you can start promoting your products and selling them. No hassles to integrate with each bank’s gateway, maintenance and repairs, and storage space.

From a user standpoint, once you link your bank account with WeChat Pay and scan a brand’s QR code, you can login, search products, place an order, check delivery status, chat with other users and/or share your experience with the community.

WeChat utilizes the mobile camera and QR code to close the gap between online and offline campaigns. For example, if customers are checking a product in a store, they can scan the QR code and receive all the product information and promotion details and use WeChat Pay to complete the purchase on their mobile phone. Vice versa.

Tencent has opened WeChat's API to external application developers. People can use WeChat to book an appointment with a doctor, scan the QR code and buy the recommended medicines at a drug store.

WeChat Finance

WeChat allows its users to provide short-term lending to those in need through its lending platform called 微信好用钱. For example, if Jack has used up his salary in June and is short of $1,000 for the month, he can apply for a loan on WeChat and return it in a month at $1,060. The interest is $2 per day.

The processing fee is 2 yuan per loan ($0.4 Canadian dollars). The whole loan evaluation process is manual, no asset required. The process is streamlined and in some cases, the loan can be released same day. The maximum daily loan is up to $50,000 ($10,000 Canadian dollars.)

WeChat has also developed a personal finance platform called 微信理财通. It allows a minimum investment amount of 100 yuan, ($20) T+1.

You can view the 7-day annualized rate of return by clicking “Wealth” tab on WeChat. (see picture below)

Picture: Tencent 7-day annualized rate of return

WeChat has done a phenomenal job that the New York Times featured a video to introduce it.