Although Alibaba and Tencent started their business widely differently, they are now quite into each other’s space, influencing the country’s internet economy. Obviously the e-commerce sector is one of the most fierce battlefield for these two giant players.
People always says that Tencent doesn’t have the gene of e-commerce, why Tencent insists to dream about e-commerce?
- Wechat blocks Taobao’s link.
WeChat and Alibaba do not like each other. In fact, to this day, you cannot send Taobao or Tmall links to your WeChat contacts. Alibaba’s fix is to generate this kind of code called Tao Code that has this seemingly random combo of symbols and letters. You copy the message that contains the code, and then open the corresponding app and the app will know which page to open to.
2. Tencent incubates many attempts before.
Tencent tried to compete with Alibaba head-on back in 2005, by launching its own platform, Paipai 拍拍网, and actually got up to 9% market share at one point, although I guess it was never truly a big threat to Alibaba.
Paipai didn’t reach Tencent’s expectation. With the development of Mobile Internet and mini program in Wechat, Tencent launch Wexin Xiaodian. However, Wexin Xiaodian is just available to business not individuals.
And this year, WeChat announced that it would retire 微信小店 and launch a new product, 微信小商店, AKA WeStore. I’ve also seen it referred to as WeChat Minishop, but the official name is WeStore.
3. Tencent has mostly invested in other e-commerce players
Tencent never gave up on e-commerce though, and tried a few other initiatives throughout the years, but none of them really worked out.
Now, you might be curious, is Tencent standing by while all these players are trying to build businesses off of the WeChat platform it so carefully built? No, of course not! In 2014, they changed strategy. They took Paipai and QQ Wanggou 网购 and some other stuff, as well as around $200mm of cash and became a 15% shareholder of JD instead.
As we mentioned before, Tencent has been blocking Alibaba’s content within its network, giving room for JD.com, and especially Pinduoduo to grow. The MAU(Monthly Active Users) of Pinduoduo surpassed Taobao in the first quarter of 2020, with the giant traffic support from Wechat.
The future prospect.
- Private Traffic will continue boosting in WeChat ecosystem.
Not only consumers, but also brands, are more often engaged in WeChat. That’s not really surprising if you think about just how much time users are spending on social media and social networks like WeChat, Weibo and Douyin. Nearly half of their time online! So if you’re a brand, you’re definitely thinking, well, it doesn’t make sense that I’m spending all my money on Tmall rankings when my users are spending half their time on WeChat and Weibo learning about new products and I’m not meeting them where they’re spending all that time.
2. Innovated technology is worth expecting.
Mini programs provide many functions when it’s launched in 2017, more and more systematic ability empowers users better interact within WeChat ecosystem.
I’m personally really looking forward to the new tech to reform the game rule of e-commerce. What can we imagine if we combine with AR/VR and online shopping? Will the vitural livestream be more popularized in the future?
Tencent will still dream of e-commerce, we as normal user, will also dream of the new experience of shopping online.