The Rise of WeChat


WeChat is little known beyond China’s borders yet, with over 700 million users, has come to dominate much of daily life and commerce in Asia’s largest economy. It is ubiquitous, rivaled only by the likes of Facebook, Google, and Alibaba (another national champion).

What’s the key to WeChat’s success in China? Tencent—the firm that developed the app—has benefited from three factors unique to China: 1) the size of their home market (nearly 1.5 billion people), 2) the rapid adoption of mobile technology across all sectors of Chinese society and 3) access to most foreign competitors (e.g. Facebook) are blocked in China. This has allowed Tencent and other now large Chinese firms (such as Baidu, which developed the dominant online search engine) to grow relatively free from outside competition in a very large and (generally) profitable market.

Whereas many firms sporting similar applications outside of China—such as Facebook’s What’s App—tend to offer separate, limited services, WeChat brings many—often complementary—features under one roof. WeChat’s services range from booking tickets and hailing taxis to banking and investment management. WeChat Pay (like Apple Pay) is used by large firms and street vendors alike, eliminating the need to carry cash or cards. This is only one way in which the app is defining commerce in China and, as it leapfrogs ahead, much of the world.

WeChat did not become a dominant mobile platform overnight. Tencent has spent years introducing and acquiring new products and services. Some, such as the firm’s microblogging application and online search engine failed to take off, losing out to domestic competitors, Sina and Baidu respectively. The firm’s first major success was QQ, an instant messaging program, which was developed in-house and expanded over many years. The eventual dominance of QQ as an instant messenger in China gave Tencent the financial heft needed to acquire many small, but promising firms. Many of these and other services are now a part of WeChat.

In addition to these, Tencent has made significant investments in high-growth firms, securing partnerships and adding to an already expansive offering of in-app services via these third parties. DidiChuxing, a taxi hailing app which recently solidified its dominance of the Chinese market through its acquisition of Uber’s Chinese subsidiary, is a prime example of the latter.

WeChat’s dominance of online communication and large swathes of commerce in China means the platform should be a key part of any firm’s interactions with potential and existing customers. This ranges from direct sales and customer service to public relations and marketing campaigns—all of which is now expected by Chinese customers and can be done via official in-app corporate accounts. Given the scope and pervasiveness of WeChat in China, its use is critical to the success of firms operating in the Chinese market, foreign and domestic alike.

Latest Articles