WeChat now boasts 1.1 billion active users, with most being in China. That’s great news for Tencent who have prodigious insights into the online, offline and commerce behaviour of a large swath of Chinese consumers. Yet its almost-100% saturation of China’s online population also presents challenges to Tencent, who is having to shift its strategy from growth by acquisition to extending the utility of WeChat and its data. To make things tougher, AI-driven competitors such as Douyin are cannibalising the screen time users spend on WeChat through services that are easier to use and more entertaining.
Tencent isn’t sitting still. It’s made some structural shifts in its strategy such as seeking to entrench itself in more industry-related applications from health services to public transport, and this month announced it joined the race for auto intelligence, aiming to provide car makers networking services, algorithms for autonomous vehicles, and location-based services.
Nevertheless, WeChat remains committed to its bread-and-butter (or rice-and-soy) consumer base, evolving with services such as authentic story telling, Official Account live streaming and new Little Red Bookesque-social commerce features – all enriching the consumer experience and presenting exciting opportunities for brands.
For many brands, finding success with WeChat isn’t just about strapping on new services as they are launched, but changing the structural approach to how they view WeChat – much like Tencent has done. The good old approach of pushing out content week in-week out on WeChat rarely works these days. More than half of WeChat Official Accounts are losing followers and the open rate of WeChat articles dropped from 17% to 6% between November 2015 and August 2018 according to social media management platform KAWO.
To increase engagement on WeChat, more brands would be wise to view the platform less as a one-to-many broadcast tool and more as a personalised and targeted interface to connect with and understand the target market. CRM capabilities on WeChat allow brands to gather information about their fanbase far beyond the standard name, avatar, gender and location that come by default. WeChat’s expanding suite of services and subsequent touch points allow brands to track individual’s preferences, behaviour and propensity to engage with different things. This data can be complementary to other insights that can be tracked such as how the user followed the WeChat account, whether through a specific article, promotion, at an offline event, store or scanning a QR code on packaging.
WeChat also lends itself to engaging initiatives such as chatbots, which offer brands a form of simple AI allowing them to connect with their customers’ personal needs and have related dialogue – over and above the usual WeChat messaging quotas – directing them to relevant content and services. Data from these interactions can feed into the CRM system to provide a view into consumer needs that can be coupled with other insights to build truly meaningful consumer-led propositions.
Richer CRM data allows brands to have more targeted, localised and personalised communications over WeChat. Interactions with consumers can be much more resonant based on whether the consumer has a family or is single, lives in Shanghai or Shenyang, if they like lace or leather or the time of the day they are most responsive. In a market as competitive and cluttered as China, particularly with more brands engaging with AI for targeted and personalised interactions, it is fast becoming a minimum requirement to continue to grow engagement. China Skinny can assist to develop your strategy for this.
For our Shanghai-based readers, China Skinny’s Andrew Atkinson will be presenting the Heath Ingredients & Food Ingredients Asia event next Wednesday 19 June discussing headline trends influencing consumer needs across China’s health food categories. More information here. Please let us know if you’ll be there. Go to Page 2 to see this week’s China news and highlights.