Pay Attention, Snapchat! China’s WeChat Messaging App Does E-Commerce Well.
The mobile-focused app is massively popular in China and spreading quickly abroad; of the 270-million-plus regular users of the service, about a quarter of those are outside of mainland China.
Aside from its wide user base, WeChat’s biggest success looks to be in its bottom line: In-app purchases.
Take WeChat’s recent experiment with the fast-growing Chinese smartphone maker Xiaomi. The two companies teamed up to offer a limited number of Xiaomi’s latest flagship phone, the Mi-3, inside the WeChat app exclusively. Xiaomi set aside 150,000 devices to sell for the promotion, and the phones sold out completely — all within about 10 minutes.
The free-to-download app also updated to include other in-app purchase options earlier this year, including a storefront for sticker-pack sales and, more importantly, an in-app social game network. From early estimates, games using the WeChat network of contacts have seen significant traction in downloads and sales.
The app, run by Internet and media conglomerate Tencent Holdings Limited, is one of a handful of highly popular Asian messaging apps taking off at the moment. Japan’s Line app recently announced 300 million registered (though not necessarily active) users, while South Korea’s KakaoTalk boasted more than 100 million users as of this summer.
If good apps borrow, great apps steal. All of these companies have lifted features from each other, plucking design elements, features and concepts freely from one app and incorporating them into another. Even American companies have joined the trend; Facebook, Path and others have brought stickers and other types of in-app purchases into the companies’ own messaging applications.
Will Snapchat, the closely watched ephemeral messaging startup, go the same route?
It seems likely. Snapchat CEO Evan Spiegel has said he highly admires the route WeChat has taken to monetization, and would likely offer similar value-added services at some point (though he said the company will be methodical in its implementation.)
What is unclear is how American audiences will react to phenomena that may prove popular abroad, yet are untested in the U.S. Stickers have seen heavy use on both Facebook and Path; perhaps in-app gaming will be next on the list.
And, I imagine, Snapchat will keep a close eye on how WeChat’s e-commerce efforts pan out.