This article is the part of a multi-part series in partnership with Kawo and The Mailman Group. This post originally appeared on Kawo and is written by David Patnaik.
After only four years of existence, Tencent’s WeChat is now one of the top mobile messaging platforms in the world. While some apps place most of their focus on one-to-one communication, WeChat distinguishes itself through its bevy of unique features.
With everything from the quirky “Drift Bottle” feature to the ever-practical “Walkie Talkie” option, WeChat’s decision to be more than a pure mobile messaging app has allowed the company to uniquely position and differentiate itself with regards to the competition. Their innovative approach to product design and development has allowed them to accumulate over 1.12 billion registered users across the globe with 440 million of those being active monthly users.
One of the most popular elements of WeChat is the “Moments” function, which is utilized in a similar fashion as Facebook’s “Newsfeed”. Users are able to share articles, links, photographs, and music among other things with their WeChat friends, who in turn are able to “Like” and comment on posts. A staggering 76.4% of users routinely use “Moments” to see what their friends are up to or to post content themselves. Over 3 billion items of content are shared per day through “Moments”. This is an intriguing statistic because whereas Facebook’s “Newsfeed” is the main landing page of the website, “Moments” seems to be designed to be a secondary aspect to WeChat’s core messaging service. To take that a step further, in actuality, WeChat has found that a higher percentage of users partake in content sharing or consumption on Moments than messaging their friends.
With this framework, it’s easy to see why the leadership at WeChat chose “Moments” as its outlet with regards to their increased efforts to monetize the popular app. As of January 21st (exactly four years since its initial launch) WeChat rolled out advertisements on users personal “Moments” feed.
This new function varies greatly from the self-serve advertising system rolled out for public accounts last summer. The new advertising system has a CPM sales model, which means that the cost structure is derived from the number of views an ad receives. An ad costs 40 RMB per 1,000 views in smaller cities, 90 RMB per 1,000 views in key cities (Guangzhou and Shenzhen), and 140 RMB per views in major cities (Beijing and Shanghai).
Ads will be valid for seven days with the service “pushing” one ad to every user of “Moments” per 48 hours. These advertisements will function in a similar fashion to non-advertisement posts, with users being allowing to “Like” and comment on the post. Users will be shown different ads depending on big data analysis of their previous WeChat behavior. It is also important to note that ads that garner no comments or “Likes” in the first six hours after they are posted will be removed from the “Moments” feed, likely in an effort to curtail obtrusive posts from WeChat users.
Tencent has gone ahead and hand picked 50 brand advertisers for “Moments” advertisement’s initial trial. The base price for an ad campaign on WeChat Moments is reportedly 5,000,000 RMB, which represents a clear effort to attract the biggest and most successful brands. BMW, Vivo, and Coca-Cola were the first three brands to debut on “Moments” advertising.
The reaction to WeChat’s new advertising has been mixed. As expected, some users were annoyed that the advertisements appeared on their timelines. This being said, this could be viewed as a major win considering there wasn’t the substantive major backlash that was experienced when Weibo initially forayed into advertisements.
Given WeChat’s history of innovation and tendencies to think outside the box, it’s not difficult to surmise that WeChat will succeed where Weibo failed. In viewing this through a Western lens, Facebook and Instagram faced similar controversy when they initially debuted paid advertisements for brands. However, due to their dedication to consistently improve their product in unique ways and to limit the number of brands able to reach the masses, the social media companies never truly suffered any significant backlash or drop in usage.
It’s not impetuous to determine that WeChat could find similar success, and it will be interesting to see how this progresses in the coming months.