![]() ![]() WeChat Wallet is essentially the Trojan horse that “unlock new monetization opportunities for the entire ecosystem,” as Connie Chan at Andreessen Horowitz observes. Much of this has been enabled by what is perhaps the single smartest move on its part – to convince its massive user base to link their payment credentials to their accounts, which greatly reduces the friction of subsequently using WeChat as a digital wallet for engaging in various other transactions. Today, WeChat’s ARPU is estimated to be more than $7, compared to, for example, around $2.50 for Snap. This, in turn, has allowed WeChat to capture value at each transaction point via commissions and advertising. This has allowed WeChat to shift from simply being a messaging service into becoming a one-stop platform for multiple products and services – an entire ecosystem that lives on top of WeChat. Given messaging’s strong network effects within a local market but relatively weaker network effects globally between markets, WeChat chose to initially remain focused on the Asia market, particularly China, but to become a horizontal aggregator of services across many verticals – financial services, gaming, transportation, delivery, appointment scheduling, online dating and so on. The strategic decision it made has been pivotal in allowing the company to gain the ubiquitous standing it has today among Chinese mobile users. Once WeChat reached critical mass, it turned to the question of long-term growth. ![]() Pathways to a Just Digital Future Watch this tech inequality series featuring scholars, practitioners, & activists Scaling up (and monetizing at the same time) WeChat also made the user action of adding other users a seamless process by giving each user a unique QR code and building in a native QR scanner – something that social communication services such as Snap have adopted. This allowed the app to gain early traction, independent of its design and functionality. Tencent employed a number of growth hacks to bootstrap WeChat’s initial user growth: most notably, it tapped into its then-700 million QQ user base to convert them into WeChat users – in the first few months of operations, a QQ account was the only way to sign up for a WeChat account. ![]() WeChat’s status as an offshoot of a parent company with deep pockets was critical to its early growth trajectory. WeChat was initially launched in 2010 as a mobile instant messenger service by the Chinese internet giant Tencent, which was smart for choosing to build a mobile-first messenger platform rather than attempt to adapt its existing desktop-first IM service, QQ, to mobile phones. So what can we learn from WeChat’s growth and is it truly poised to take over the world, or at least China? (Hint: A lot, and maybe) The process of booking a doctor’s appointment via WeChat Wallet What started as a mobile messaging app has quickly evolved into what some in the industry have dubbed “a portal, a platform and even a mobile operating system.” Its 846 million users can buy movie tickets, hail cabs, order food, send money to friends, play games, book doctor appointments, pay utility bills, read up on news, check in for flights, meet local strangers, donate to charities – oh, and of course, chat with other users around the world via text, voice messages, free Skype-like voice calls or video calls. In the world of mobile, WeChat represents perhaps the textbook example of a platform business. ![]()
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