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China Marketing: Is WeChat Really a Viable Platform for Marketers?

Whenever I see an article or news headline that is in the form of a question, I immediately answer "No!" in my mind. There is so much click-bait and so little time. However, in this case there has been a genuine debate in China by agencies and local and international companies about the value of a marketing investment in the WeChat Platform.

WeChat (Chinese: WeiXin — 微信) is a social messaging platform that at first glance is similar to WhatsApp. Introduced in 2011, WeChat is now enormously popular in China and has gained some foothold in Asia. August 2014 usage shows that there are 436 million monthly active users (MAU) of WeChat with an undisclosed number of them outside China. A figure of 100 million "registered" users outside of China was published by Tencent, WeChat’s parent, in 2013, but actual MAU information isn’t known. In any case, considering that there are close to 630 million netizens in China means that WeChat has had quite good penetration in less than four years. And the penetration is greatest among affluent buyers of all ages in the largest cities in China. Living in China for the past two years, I’ve met hundreds of people living in China and literally know no one who is not on WeChat here.

First-party data (i.e., your customer data) can’t be linked directly from WeChat, like one can now in Facebook. Tencent regularly claims that WeChat is not a "marketing platform." Therefore the many things we’ve grown to expect about monetization don’t exist in WeChat, which makes it difficult to locate specific customers and prospects in the platform. Also, companies are limited in knowing their marketing reach when comparing WeChat’s capabilities to those marketing push capabilities in Facebook or Twitter. WeChat provides a "broadcast" to followers and then communicates with responders through a one-to-one model. The marketing KPIs center on the interaction level with your direct followers and any sales/interaction bump related to those interactions.

WeChat provides two kinds of accounts that a business can use to engage their fans and gather followers: One kind is a subscription account that provides the ability to reach out daily to followers, but puts your messaging in a bucket among thousands and thousands of other company messages.

The second option is to create an official account, which is more stringent to get—in terms of paperwork and validation—but provides extensive programmable interfaces via an excellent API to build menus and other app-like features. Service accounts can broadcast weekly messages and once a user responds (by clicking on a link in your message or any other activity), your app can interact with that user specifically. Also, it is possible to repeatedly identify the user via their OpenID which is passed to any web pages or other interactions that you have with that follower over time. Likewise, unique identifiers—such as cookies and consumer behavior data—can be tracked once they are in “your” property because they behave as normal web pages.

WeChat is excellent for brand and loyalty programs; one can drive fans to the corporate WeChat account and then engage with them and give them reasons to go back frequently to check for new things. For example, online ordering of goods and services, loyalty tracking systems, couponing, custom games, and customer support—all these customer and prospect engagement models are alive and well on WeChat now. Companies, like McDonald’s for example, actively engage with their customers and allow them to order meals for home delivery via their WeChat app—both McDonald’s and KFC are popular in China and offer 24-hour home delivery in most large urban areas. WeChat is currently dabbling in the display of ads (banner style, at the bottom only!) in a limited account test.

I believe it is only a matter of time, despite Tencent’s statements, before some kind of Facebook-style marketing ability occurs. Tencent is racing into everything from search engines (investing in the number two search engine in China), to online shopping (investing in jd.com), taxi-hailing apps (dididache), payment systems (WeChat payments, Dalian Wanda Group), a Chinese answer to Yelp (dianping.com), and even a Chinese answer to Craigslist (58.com). These purchases and investments are all aimed at what is termed the “O2O” selling, online-to-offline. And, Tencent (and the other big guy on everyone’s lips right now, Alibaba) is racing to include these services in their platforms.

So, the answer to the question about WeChat marketing viability seems to be: It is viable. Your customers and your prospects are already there; if you’re not there engaging them, it’s very likely your competitors are. To get started, I suggest that you figure out the best way to use this platform in combination with other massive platforms in China. It likely won’t be your primary platform for some time, but it is a valuable part of the overall plan. You have to go where the consumers are and this is where they are in Asia.

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