Last November, Tianhong’s Junshang 3019sp@ce supermarket officially upgraded to a WeChat payment smart retail store. The number of cashiers reduced from 15-20 to only two on that day, most of which were replaced by self-checkout machines.

Now, consumers only need to open the WeChat “scan” function and scan the product QR code price tag, and the products can be automatically added to the shopping cart. Customers can even perform face recognition and complete payment using machines provided.

In April 2018, Tianhong, one of the major retailers in China, cooperated with Tencent to set up a “smart retail lab” to jointly develop products for new retail. But this is not their first cooperation.

In September 2013, Tianhong reached strategic collaboration with Tencent. In the domestic retail industry, Tianhong was the first company to cooperate with Tencent to customize the WeChat service account.

As of now, Tianhong has completed the digital transformation for most consumer scenarios. The number of Tianhong members is over 18 million, of which the digitalization ratio has reached more than 80%, and the number of digital members is nearly 16 million.

According to the logic of traditional retail, to get more customers, you need to open more physical stores, which is not the best way for Tianhong at that time. “Omnichannel” is the solution for Tianhong to expand the customer base and achieve more customer connections, that is, the online and offline integration mode.

The real beginning of the omnichannel business is cooperation with WeChat. In September 2013, Tianhong and Tencent reached a strategic partnership and jointly developed the first custom WeChat service account in China’s retail enterprises, focusing on three aspects which is instant service, selected service and interactive marketing.

This cooperation immediately caused fluctuations in the capital market. Since Tianhong and Tencent announced the collaboration, within ten days, Tianhong share price experienced five single-day 10% increase, showing full attention and recognition from the capital market.

At the consumer level, it took less than two years to go online, and Tianhong’s WeChat service account has more than 2.5 million fans.

When Tianhong is attracting the new fans through WeChat, it also improves offline business by attracting consumers visiting the physical store. For example, less than two years after the launch, through the start of the WeChat service account, member interaction, and promotion, Tianhong WeChat service account has attracted more than 2 billion people to the physical stores.

Tianhong is a retail company that has started O2O and mobile app very early. In the general perception, when offline physical retail enterprises go through digital transformation, then a large number of increments in sales shall come from the online orders, which is the strategy practiced by Alibaba’s Hema.

However, the digitalization of the Tianhong is not the case. Although Tianhong also has an online business, the current order quantity is about 10% of the total. For the future, Tianhong also said that they do not expect a substantial increase in online orders. As Tan Xiaohua said, “The digitalization transformation of our business is to expand our existing powerful physical store, but not starting a new and smaller scale online business.”

Source: ChinaInternetWatch

China’s rise as a tech powerhouse could become one of the dominant stories of the 2020s.

A*STAR Science in Singapore asked us to teach their entire branding and marketing team. They want to know about how to use WeChat to attract top scientists and investment partnerships into Singapore. Warren Teh our CEO was more than happy to teach them how to use leverage this platform to achieve their KPIs. They were so happy that in the end they presented us with a intriguing science book that Warren's daughters will love.

Want to learn more how to get customers from China? Do you have run a marketing team and are quite blur to how you can use WeChat? Just drop us a line and we will be happy to get you up to speed.

Former LinkedIn China president Derek Shen said Monday that the professional networking site has “lagged way behind” Tencent’s chat platform WeChat, two years after stepping down from the company.

“It’s horrible that the LinkedIn product managers don’t even realize they have lagged way behind a list of new social networking services such as WeChat, feeling good about themselves instead,” said Shen in a LinkedIn post on Monday. The former LinkedIn executive said that he tried to improve the platform when he joined the company six years ago, but struggled to make progress as it involved so many stakeholders within the organization.

Shen’s posted his public gripe after he was unable to message a newly added friend. He also said that the company was prioritizing profits by prominently displaying features such as friend recommendations while leaving out core features such as the friend list.

LinkedIn was not available for comment.

In a reference to Facebook founder Mark Zuckerberg, Shen added that LinkedIn should “target WeChat and try to catch up.” Zuckerberg said on Friday that he regretted not taking advice given four years ago to learn from WeChat, reported the South China Morning Post.

China’s professional networking market is dominated by domestic companies. According to Beijing-based research firm Sootoo Research (in Chinese), Alibaba’s Dingtalk is the most popular job connection service for Chinese users beginning in the first half of 2018, with more than 92.6 million downloads during the period.

Two other challengers, Maimai and Tongdao, the messaging platform for online jobs website Liepin, follow with 87 million and 18 million downloads, respectively. LinkedIn was not listed in the report, which ranked the top five professional networking apps.

Derek Shen announced his resignation from LinkedIn China in mid-2017, and immediately assumed his post as executive chairman for the shared housing startup Danke Apartment. The Beijing-based startup just raised $500 million in a Series C led by Alibaba’s fintech arm, Ant Financial, and US-based investment firm, Tiger Global Management.

Source: TechNode

Zuckerberg announced last week that Facebook planned to transform into a platform focused on private messaging

Facebook founder Mark Zuckerberg said he regretted not taking note of China’s super-app WeChat sooner after his social media empire announced a shift to private messaging last week amid a privacy crisis, in a move that copies features of China’s dominant social media platform.

“If only I’d listened to your advice four years ago,” Zuckerberg wrote on Facebook on Friday in response to Jessica Lessin, founder of tech media The Information, who highlighted a March 2015 article she wrote that suggested Facebook should learn from WeChat.

Zuckerberg announced last week that Facebook planned to transform itself into a privacy-focused platform. With a focus on private messaging, it would “build more ways for people to interact on top of that, including calls, video chats, groups, stories, businesses, payments, commerce, and ultimately a platform for many other kinds of private services,” according to Zuckerberg’s post on Thursday.

In that respect, the future of Facebook resembles the reality of WeChat, the ubiquitous Chinese super-app with over 1 billion users developed by Tencent Holdings. WeChat’s omnipotence in China is centred around its basic functions of messaging and social media, which are only open to WeChat friends. But the app also offers a wide range of mini programs, including digital payments, that enable users to shop, hail a taxi, order food, pay utility bills and more.

Tencent did not immediately respond to a request for comment.

Facebook’s new direction is a good move but it will have to find a balance between its monetisation from advertising and keeping users on its platform, said Norman Hui, a Hong Kong-based analyst with Zhongtai International Securities.

“WeChat has done a great job in redirecting its user traffic to its portfolio companies such as e-commerce site JD.com and food delivery service Meituan Dianping within the app, but Facebook would have to make huge efforts to cultivate a similar behaviour among its users, who are now used to leaving Facebook for Ebay or Amazon when they make a purchase.”

Facebook’s new vision for social media comes amid the ongoing public backlash concerning the platform’s use of personal data. Zuckerberg acknowledged the issue of data privacy in his post last week, saying the company “[does not] currently have a strong reputation for building privacy protective services” but it will “[implement] end-to-end encryption for all private communications”.

Without end-to-end encryption, WeChat has been criticised for not doing enough to protect user data. While Tencent claims that WeChat does not spy on user conversations nor retain records, it said it would comply with any law enforcement requests for user data. “We are very concerned about user data security. It is top of our concerns. In a law enforcement situation, of course, any company has to comply with the regulations and laws within the country,” Tencent president Martin Lau Chi-ping said last year.

Even as Facebook seeks to take a leaf out of WeChat’s book, the Chinese app is already looking to the next phase of development to serve more businesses as part of an industrial internet push.

With an increasingly saturated and competitive consumer market, Tencent revamped its organisational structure on the eve of its 20th anniversary last year to align more closely with enterprise users. In an open letter at the time, founder and chief executive chairman Pony Ma Huateng laid out the rationale for the restructuring, saying that digitisation of the economy meant the battle for the internet has moved from consumers to industry.

In January, the Shenzhen-based Tencent took a big step in extending the use of WeChat beyond smartphones with the introduction of a Siri-like voice assistant that could potentially be deployed by businesses and in smart cars.

WeChat italking, or Xiaowei in Chinese, works on devices from smart speakers to cars by linking WeChat users with Tencent’s stable of services, including QQ Music. Meituan Dianping, Didi Chuxing and Mobike, three on-demand service providers that count Tencent as a strategic investor, will also connect with Xiaowei.

Ma first flagged the innovation last May when he said Tencent was working on a voice-operated version of WeChat for in-vehicle use, a move that could extend the platform’s content and services to millions of drivers and passengers on the road. China is the world’s biggest auto market, for both internal combustion engine cars and electric vehicles.

WeChat has also been providing artificial intelligence tools so that businesses and industries can connect and serve their consumers on WeChat, usually through the use of mini programs, which are applications smaller than 10 megabytes that can run instantly on WeChat’s interface.

In the education field WeChat has been partnering with public schools and private training centres to enable students to make purchases at canteens, check test scores, and do other functions on the app. Tencent’s retail partners, including Walmart, let shoppers skip the queues at the cash register by scanning the products and paying for them on their WeChat app.

“We see mini programs as an important tool to empower merchants and brands in acquiring traffic at a lower cost through WeChat’s large social network,” said Jefferies equity analyst Karen Chan in an earlier report.

Source: South China South Post

A picture illustration shows a WeChat app icon in Beijing. Photo: Reuters

Tencent has frequently added innovations to WeChat, designed to drive growth and loyalty, the latest being mini programs.

BEIJING — Many people outside China either still have not heard of WeChat or they think it's the country's equivalent of popular messaging service WhatsApp or social media giant Facebook. For many people in China, WeChat is much more – it is not an overstatement to say it's an indispensable part of their everyday lives.

WeChat, or Weixin as it's known in China, began life in a southern corner of the country at the Tencent Guangzhou Research and Project centre in October 2010. Since then, it has grown into the most popular mobile app in the country, with over one billion monthly active users who chat, play games, shop, read news, pay for meals and post their thoughts and pictures.

Today, you can even book a doctor's appointment or arrange a time slot to file for a divorce at the civil affairs authority.

The seven-year-old app has also laid the foundations for stellar growth at Shenzhen-based Tencent Holdings, the tech giant behind WeChat, turning it into one of the most influential companies in China and grabbing the attention of global investors.

Since the official launch of WeChat in January 2011, Tencent's market capitalisation has risen over tenfold.

Yet, the company has hit a speed bump. Tencent has lost 29 per cent since a peak of HK$476.6 (S$83.5) a share in January this year to trade at HK$336, erasing US$170 billion (S$234 billion) from its market value as of Wednesday's close.

Even before this sharp fall, some commentators had been asking whether Tencent has "lost its dream", by focusing on growth through investment rather than the type of organic innovation that led to the creation of WeChat.

After the market close on Wednesday, Tencent reported a 2 per cent drop in second-quarter profit on lower gaming revenue and investment-related gains.

Net income fell to 17.9 billion yuan (S$3.6 billion) in the quarter ended June 30, compared with the 19.3 billion yuan average of 12 analyst estimates compiled by Bloomberg.

Sales were 73.7 billion yuan, missing analyst estimates.

Tencent's overseas counterpart Facebook, with 1.47 billion daily active users (DAU) and 2.23 billion monthly active users (MAU), experienced a stock price loss of over 20 per cent after announcing its slowest quarterly user growth since 2011 in its second quarter earnings report in July.

However, Tencent is still in the early stages of monetising its WeChat user base.

Cautious to avoid flooding user timelines with ads, WeChat currently allows a maximum of two ads a day to appear on its social platform Moments, which is "extremely conservative compared to our global peers", said Tencent's chief strategy officer James Gordon Mitchell in a May conference call with analysts.

"With improving targeting capability, opening up of inventory and roll-out of ad formats, we expect increasing dollar shift to social performance-based advertising, of which Tencent … should be the key beneficiary," Jefferies analyst Karen Chan wrote in a research note in July.

Other analysts are also optimistic on WeChat's prospects.

"WeChat's user numbers haven't hit the ceiling yet but I think they will at some point," said Mr Matthew Brennan, managing director of independent WeChat consultancy China Channel. "But they still have a lot of room to grow in advertising, and now with mini programs."

Mini programs refer to applications typically smaller than 10 megabytes that can run instantly on the main app's interface. They offer speed of access to users because a programme does not have to be downloaded from an app store, they can run from within the app.

This innovation allows platforms to host multiple services, turning them into super-apps, delivering greater convenience to consumers in the world's largest smartphone market.

Mini programs are aimed at keeping users within the WeChat ecosystem, at a time when short video apps are on the rise.

In June, the percentage of time spent on messaging apps among mobile users declined from 36 to 30.2 per cent compared to the same time last year, while time spent on short video apps rose from 2 to 8.8 per cent, according to figures provided by internet data services provider QuestMobile in July.

However, mini programs are just the latest in a long line of innovations at Tencent's WeChat.

When Tencent's flagship messaging service QQ was the dominant player in social media in China, Tencent founder, chairman and chief executive Ma Huateng (know as Pony Ma) did not rest on his laurels.

He spotted the inevitable shift in traffic from PCs to mobile internet in 2010, as smartphones led by Apple's iPhone, gained in popularity. Ma knew that a mobile instant messenger would be the key to the future.

Mr Allen Zhang, the head of QQ Mail Mobile in 2010, led a team with less than 10 members to develop the first version of WeChat in less than 70 days, beating out two other internal teams working on the same project.

Mr Zhang joined Tencent in 2005 when his Foxmail business was bought by Tencent and became the head of QQ Mail Mobile.

"WeChat is a strategically important platform for Tencent because it will help to sustain and evolve our social leadership from PC to newer mobile devices," Mr Martin Lau, president of Tencent, said in a conference call in 2011.

Tencent provided information about WeChat's latest developments but did not make executives, including Mr Zhang, available for interviews for this article.

The South China Morning Post reviewed conference call transcripts, filings, public speeches and local reports dating back to 2010 in researching the development of WeChat for this story.

The first version of WeChat only allowed users to send text messages and photos.

The launch received little response from the market, at a time when instant messengers such as Feixin, an SMS app by China Mobile, and MiTalk Messenger by Xiaomi, were already on the scene.

"It cannot send a short message to someone's phone number (like Feixin). It does not have the functionality of QQ. What's the meaning of having this app," one user wrote in the comments section on WeChat's iOS app store page seven years ago, rating WeChat one star.

The inflection point for the WeChat team arrived in May 2011 when it was updated with voice messaging, enabling a user's phone to work like a walkie-talkie. Daily user growth spurted from 10,000 to up to 60,000.

"The voice message function turned senior business people who weren't used to typing on smartphones into our WeChat users," Ma recalled in a speech in Tsinghua in 2016.

WeChat evolved quickly, including new functions such as 'Shake', which connected users who were randomly shaking their phone at the same time, and 'Message in a Bottle', which enabled messages to be sent to random users.

In July 2011, it added location-based service 'People Nearby' that allowed users to connect with strangers close to them. In Mr Zhang's words, this was a "game changer" and pushed daily user growth to 100,000.

"Shake and Message in a Bottle as well as People Nearby were born at the right time, offering access to different people," said Mr Lu Shushen, a former WeChat employee in an article on his WeChat account, referring to social networking among strangers.

By March 2012, WeChat had exceeded 100 million registered user accounts – just 433 days after launch.

WeChat users grew in tandem with smartphone growth in China. In 2010, when WeChat was still a research project, there were only 36.1 million smartphone unit sales in China. That number increased to 90.6 million in 2011 when WeChat was officially launched and had rocketed to 214.2 million by 2012.

But WeChat was growing even faster than this and was gradually leaving its competitors further behind. Feixin, for example, was reluctant to open up its messaging service to non-China Mobile users and MiTalk struggled to provide a stable user experience.

WhatsApp, WeChat's biggest overseas rival today, was available to the Chinese market at that time (it was later banned by China in 2017 ahead of a major Communist Party congress) but missed its opportunity without any localisation or promotion in the market, China Channel's Mr Brennan recalls.

WeChat was also evolving into a hybrid social network, with the introduction of its sharing service Moments, the blog-like Official Accounts to help brands and content producers market themselves, and a games publishing platform.

WeChat added payments to the platform in 2013, and for a while this was limited to paying for games, virtual items and services such as mobile subscriptions. But when 'Official Accounts' were added to WeChat in 2013, Tencent's management were hoping that this would transform WeChat into a full service platform.

Any WeChat user can set up an Official Account to broadcast messages and articles to their followers like a blog, but brands and service providers can also use these accounts to service customers.

Today, users can buy products, order meals or make a doctor's appointment – among many other things through this channel.

However, while WeChat Pay got off to a relatively slow start, the game was about to change in a major way.

Before the Lunar New Year of 2014, Tencent co-founder Tony Zhang assigned a WeChat team member to improve the way Tencent traditionally handed out hongbao – red envelopes with money inside as a gift for Lunar New Year – to staff.

As a result, the WeChat Red Packet was developed as a way to send "virtual" money to friends.

WeChat's Red Packet became an overnight sensation during the 2014 holiday period, with over eight million Chinese receiving over 40 million hongbaos during the period, leading Alibaba's founder Jack Ma to dub it the "attack on Pearl Harbour".

Users started to tie their bank accounts to their WeChat mobile wallet and it started to compete with Alipay – an already established mobile payments service from Alibaba Group Holding, parent of the South China Morning Post.

In 2018, 688 million people used WeChat's hongbao service on Lunar New Year's Eve.

Which brings the story back to WeChat's mini programs. By enabling greater functionality within the WeChat ecosystem without the need to download an external app, mini programs are aimed at driving customer loyalty, or stickiness, within the WeChat app.

"We view mini programs as an enhancement of our Official Accounts system, designed to connect offline service providers with users online," Tencent's Mr Lau said in 2017.

The concept of mini programs did not fully take off until January 2018 though when Tiao Yi Tiao, a jumping mini game, recorded 100 million daily active users after being launched in late December.

"We have had our ups and downs this year, but in general, I think we have met our initial expectations," said Tony Zhang in a January interview in the People's Daily, the ruling Communist Party's mouthpiece.

By the second quarter of 2018, the number of WeChat mini programs reached one million and mini programme users surpassed 600 million in June this year.

"The mini programme initiative is opening many doors for Tencent," said China Channel's Mr Brennan.

"Monetisation due to adverts and payments … and by allowing Tencent to incubate and accelerate a variety of businesses within the ecosystem – e-commerce in particular."

Source: TODAYonline