In the age of technology,the proliferation of smart phones promotes the popularization of social network platforms,it also reshapes the way people communicate with each other.In China,WeChat has become the most well-known social networking platform in recent years,its unique marketing pattern makes it stand out from the intense internet competition,and established a firm position within the industry.
In traditional sense,different industries possess their own social division,and also they share the market resources separately,however the emergence of WeChat platform has changed this pattern,it aggregates the features and properties of products from different social media platforms,which achieves the commercialization of social networking.
Nowadays WeChat is generally perceived as a marketing tool with huge virtual value,rather than just a medium of communication.This analysis would introduce the nature and development history of WeChat,its functionality and social connection with other industrial sectors,and how it utilizes the innovative strategies to transform the original lifestyle.
The Nature of WeChat
The operation system of WeChat is built on the basis of voice messaging communication and mobile instant text service(Cao,Lien and Zhao,2014).As one of the affilitated platforms created by Tencent company in 2011,the emergence of WeChat complied with a more diversified social networking strategy,also it was aimed to satisfy the need of an increasing number of personalized smartphone users in China.
In fact,WeChat is not a traditional sense of instant messaging platform,its functionality touches different areas of life.WeChat is an interactive aggregation which incorporates a variety of technical elements together,such as the personal and company data,as well as the consumption data(Yanes and Berger,2017).Compared to other instant messaging players around the world,WeChat offers various types of services with more innovativeness,such as the broadcast(one-to-many)messaging,holdto-talk voice messaging, MOG,and online-banking management tool(Yang,Lee and Sun,2016).Those services facilitate the life efficiency and quality in a more advanced way,meanwhile they also enforce people’s dependence on this platform.
The History and Development of WeChat
WeChat service was first released in 2011, in July 2012 it had hit around 100 million users,and this number was tripled in less than three years.In 2013,WeChat user number reached 300 millions(Kontsevaia and Berger,2016).By November 2015, the total number of active users per month has increased to 650 millions, which is equivalent to 72 per cent of WhatsApp’s achievement around the world(Wang,2016).
The development of WeChat reflects the transformation of network structure in China.In the early 20th century,the widespread of computers marked the arrival of PC era,web-based messaging service revolutionized the means of communication.
Under the circumstances the appearance of QQ was considered as the symbol of urban lifestyle,which generated a tremendous response since the first time it was launched.However,in recent years the penetration of mobile services has gradually replaced the status of PC,the design of WeChat followed the trend of “smartphone lifestyle”(Wang,2016).
From 2013 to 2015 the penetration rate of WeChat raised from 64.5% to around 75.9% which has exceeded other Chinese leading social apps such as Qzone and Weibo(Yanes and Berger,2017).WeChat has achieved great success in few yeas,which benefits from the unique business pattern and marketing strategy.
The Business Model
The definition of the business model is related to two dimensions,the type of rights provided by the business,and the type of assets(intangible,human,and financial) involved in the business(Shi and Manning,2009).
WeChat business model effectively facilitates the pattern of online transactions,also,it provides a series of multimedia features that enhance the user experiences consumedly.It redefines the concept of “chatting software”, and WeChat accomplished the mobility of marketing, advertising and retailing within the social sphere.
WeChat has been trying to integrate the commercial features into the product properties,in order to promote the interaction between individuals and expand its social and commercial influence,and the functional capability of WeChat is shifted from social media platform to a “trading market”.
The core component of WeChat business model is connected to the emergence of a new feature:High monetisation(Wang,2016),which means the capital flow could be blended into the online social interaction.
WeChat Pay realizes the massification of instant payment,for individuals,it allows users to manage their business activities through the social networking interface,users are able to make payments online using the e-wallet after linking their bank details to the WeChat accounts,and they could transform money to their contacts in the list or purchase items on the WeChat online mall.
As a result,it has gained great profits from the virtual connection between the digital wallet and users personal business practices.WeChat pay interface plays an important role within the O2O market,while users could pay for their items using WeChat pay in physical stores.When users transform their money from bank accounts to the e-wallet,WeChat would charge for 0.1 percent commission fee for the transaction,in 2018 WeChat monthly active users has hit 1000 million(Hollander,2018), there is no doubt that charging users for transaction fee has turned into a new revenue source.
WeChat payment is also available for the offline shopping which accelerates the development of cardless payment in China,when retail stores registered on the public service accounts,customers could pay for their products by scanning the QR codes offered by different retail sellers.
What is more,the enormous user volume has attracted an increasing number of businesses to enter WeChat transaction interface,in order to consolidate their status within the whole market and connect with their potential customers,in this case the personalized QR codes are considered as a medium with huge commercial value which represent the brand image of individual companies.
WeChat Social Ecosystem
Status within the industry:
Chinese censorship and government control provide a relatively undemanding development environment for WeChat.Chinese central government uses “The Great Firewall” to strictly control the access to the foreign websites,which has blocked some of the most popular sites around the world,such as Twitter,Facebook and Instagram.
In March 2018 a VPN ban was implemented(Griffiths,2018),while Chinese internet users are not allowed to visit foreign pages through proxy software,the shutdown of foreign digital channels forces Chinese citizens to turn their attention to the domestic internet market,as a result,WeChat has gradually dominated the whole industry and created its monopoly in this digital era.
WeChat platform is mainly regulated by the monitoring agencies of Chinese central government with two primary tools:policing and censoring(Qin,Stromberg and Wu,2017).Policing means users might be punished if they post undesired or sensitive contents over social media platform.
For censorship,it is implemented by different private service providers located in Beijing,which focus on minority groups issues and political comments review.Surveillance tools and government regulation strictly supervise the WeChat online activities,such as the“moments”on friends circle,and articles published on official accounts.
The main suppliers of WeChat include businesses and enterprises,as well as the offline retailers.They link their services to different WeChat mini-programs,also called the “sub-applications”,and communicate with their consumers through the online interface.For example,Jindong,the second largest e-commerce company in China,created its e-commerce platform on WeChat mini-program page and sell their products to users and boost the marketplace(Brennan,2015).
The huge population of online users in China leads to an intense internal competition,to a great extent,their preferences and choices would affect the the future trend of social media platforms.
Within the border of China,the strongest opponent of WeChat in the market is one of the most recognizable e-commerce giants,Alibaba,while their competition mainly focuses on the exchange mode and transaction features.Alibaba is considered as the most influential e-commerce business in China,its third-party payment platform Alipay possesses an unshakable position among the Chinese consumers, the monthly active users has already reached around 500 millions in 2018(Jacobs,2018),which leads to considerable pressure to the future expansion of WeChat pay.
WeChat partners include some of the most influential retailers,such as Jingdong and Amazon China.Also it has the promotion deals with automobile brands,such as the Mercedes-Benz,WeChat allows those brands to customize the advertising method in a more innovative form(Boyd,2017),for example the promotion information might appear in users’ ‘moments’ page.
Who would use this platform?
Users of WeChat include official accounts subscribers and daily readers,as well as off-line companies,they could create their own homepages and mini-programs on WeChat to promote their services.
WeChat alters the traditional method of maintaining public interaction,the communication mode is no longer restricted to the voice-based messaging and typing,it created a more humanized communication pattern for strengthening the social bond between individual users.
In January 2014,WeChat launched a new program called ‘Red Envelope’,which allows users to transfer virtual money to their friends from their digital wallets,and check their transaction history(Wang,Hahn and Sutrave,2016).In Chinese cultural environment,the emblematic meaning of red envelope is related to “auspiciousness” and “fortune”,it also possesses the implication of benediction.
Therefore,red envelope has played an important role on establishing the social relationship in China for a really long time.However red envelope is not considered as a physical entity in WeChat platform,on the contrary it has been commercialized and used to update the conventional way of maintaining human interaction.
WeChat integrates the notion of ‘gift economy’ to the communication mode,and combined business elements with social interaction through this new feature.Users could send a red envelope to their friends to express their wishes,compared to other impersonal communication techniques,’Red Envelope’ encourages people to interactive with each other in a more active way.
-A new business model:O2O
Social media changes the way people get connected,meanwhile it also enhances the relationship between consumers and service providers through digital interfaces.The prosperity of WeChat contributes to the emergence of a new business model:O2O.
O2O constructs a link between virtual marketing and physical commerce,which means it targets potential customers online and then encourages consumer spending in the physical businesses. O2O transforms the situation that consumers only have access to a single type of shopping channel,it personalizes consumers’ shopping experiences based on their preferences through the multichannel retailing,such as mobile, social,offline2online,online2offline(Tsai,Wang,Lin and Choub,2015).
WeChat payment is incorporated with marketing resources and it has been widely used in many industrial sectors such as the public transportation,it improves the life efficiency with time and cost savings.Within the O2O market WeChat platform is linked to a variety of physical companies,such as the cooperation between the WeChat pay and DIDi taxi.
When using the DIDI taxi service,users need to submit an online order application for reserving a taxi or private car,and they are able to contact the drivers through WeChat,after the order is completed and reach the destination,they could scan the QR codes provided by drivers,or simply transfer money to the DIDI account and finalize the payment.
Besides,WeChat has collaborated with many other industrial sectors in O2O mode such as the food-delivery service,hotel reservation and airline tickets booking,which revolutionized people’ lifestyle unconsciously.As the major feature embedded in WeChat platform,QR scanner plays an important role within the whole O2O market,it manipulates the main process of online payment,and it is also an indispensable factor that strengths the connection between WeChat and physical industries.
The popularization of WeChat indicates the arrival of ‘mobile era’,which means people are trying to adopt a new way to enhance the life quality more effectively.
WeChat alters the traditional understanding of social media,and improves the efficiency of online engagement.It constructs a virtual connection between the communication channel and marketing strategies,users’ business activities are linked to the WeChat platform,and the interpersonal connection is treated as a medium that promotes the flow of capital in the digital interface.
More importantly it brings about the revolution of life style in the digital era,users are able to personalize the shopping pattern online,and they could have access to numerous offline services and purchase items through ‘scan QR code’,regardless of location restriction.
WeChat has become a source of ‘hybrid marketing’with search,retailing and advertising(Yanes and Berger,2017),and it built the global awareness of social media commercialization.Therefore,it is believed that it will bring about more unpredictable influence in the future.
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