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WeChat flexes muscles internationally

News, 22 November 2016

SINGAPORE: WeChat, the Tencent-owned messaging app, is taking its suite of advertising solutions overseas as it seeks to tap into opportunities beyond mainland China, with Singapore an early focus of this development, a leading executive has said.

Benny Ho, senior director of business development at Tencent International Business Group (IBG), told Campaign Asia-Pacific how the platform has divided the market into three segments.

The first of these – inbound opportunities, or reaching domestic Chinese users – is where it is currently strongest. Expansion plans, which have included the establishment of IBG, see "outbound opportunities" in reaching Chinese tourists visiting foreign markets as well as "local opportunities" in reaching users in other markets outside mainland China.

IBG aims to provide a variety of services to advertisers including media planning, creative designs, user targeting, ad placement execution, bid optimisation, and reporting, but Ho stressed that it was not in competition with agencies.

"We see our role as helping to provide both agencies and brands insight and knowledge about our ecosystem and why we enjoy such a high market penetration and captive audience," he explained.

To this end, it has formally rolled out its International Advertising Solutions business line, with WeChat staff available to help merchants in those Asian markets best positioned to benefit from "outbound opportunities", including Singapore, Indonesia, Japan, Korea, Malaysia, Taiwan and Hong Kong.

The number of Chinese tourists visiting Singapore, for example, was up more than 50% in the first six months of the year, with almost 1.5m people spending US$1.9 billion. But brands seeking to tap into this lucrative grouping need to understand how their behaviour differs from most tourists.

"Chinese tourists come to buy, not shop," said Ho. "They know before they even arrive in the country which shops they will visit and what they will get, so brands need to engage early in the Chinese customer journey in order to influence purchase decisions."

And that is where he believes that Tencent and WeChat have a major advantage. "Anybody going online in China is using one of our products and we use a single login system," he said, "so we're able to understand user information in terms of how they interact and consume content."

Ho added that Western brands also needed to understand that, unlike their own multi-app markets, China is "a single-app centric market".

Data sourced from Campaign Asia-Pacific; addition content by Warc staff