Tencent offers brands guided gateway to Chinese tourists

SINGAPORE - There was an unexpected side effect with Tencent’s launch of sponsored moments on its WeChat platform back in early 2015, which still brings a smile to Benny Ho’s face.

“One of our pioneer clients was BMW, and when users started spotting the ad on their feed, they got really excited,” recalls the senior director of business development at Tencent International Business Group. “Because our users are familiar with the fact that advertising messages they see are the result of selective targeting, the reaction was ‘I’ve made it! They’re showing me a BMW ad!’” 

Screenshots were taken and shared on social-media accounts, driving the earned-media value from the campaign “through the roof”, Ho shares in an interview with Campaign Asia-Pacific.

For many marketers and brands outside of China, the country's social digital ecosystem can seem alien and confusing, bereft of the familiar presence of players such as Facebook, Instagram or Google, which dominate in other markets.

But the internet services giant intends to help dispel some of that confusion, with the formal rollout of its International Advertising Solutions business line.

To help brands address communications and business objectives, there will be WeChat representatives to assist merchants in Singapore. Tencent’s IBG will provide services including media planning, creative designs, advanced user targeting, ad placement execution, bid optimisation, and reporting.

It is an initiative that the company launched just this year, with Singapore being a focus market, and Ho says there are plans to aggressively expand. In addition, IBG will not have an exclusive partner in the country and will welcome any local partners and resellers to support marketers and advertisers.   

To date, Tencent has launched its International Advertising Solutions in Hong Kong, Indonesia, Japan, Korea, Malaysia, and Taiwan in Asia, excluding China.

Grabbing China’s tourists

Singapore saw 1.47 million visitors from the mainland in the first half of this year, up 55.2 percent from the same period last year, according to the Singapore Tourism Board. Chinese tourists accounted for nearly 18 percent of the visitors to Singapore during this period and spent a total of US$1.9 billion.

“Chinese tourist come to buy, not shop,” says 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.”

It is this segment of consumers that forms the company’s initial area of focus with the expansion of its solutions suite outside of China.

Ho says that the company looks at its addressable market in terms of three segments: inbound opportunities, with domestic Chinese users; outbound opportunities, with Chinese tourists visiting foreign markets and local opportunities, users located outside of China.

He adds that the company is already leveraging its inbound segment, calling it an opportunity that is “very clear” to a lot of brands. But Tencent has only just started its journey when it comes to outbound opportunities.

According to an eMarketer’s survey WeChat in China from June 2016, the top two leading social media sites/chatting apps among social media users in China are WeChat and Qzone—both Tencent products.

There are more than 806 million active users for both WeChat and Weixin today, and GlobalWebIndex (GWI), operator of the world's largest study on digital consumer behaviours and trends, showed that between the first half of 2015 and the first half of 2016, WeChat nearly doubled its usage rates in APAC outside of China.

Weixin connects users through its communication features with services and hardware through its open platform, including advertising, official accounts, and online to offline (O2O) payment.

The company also has communications app Mobile QQ, and Mobile Qzone, a leading social networking site in China, and QQ Music, one of the most popular digital music platforms in the country, which will also provide a gateway for advertisers in Singapore.

Ho declined to share what percentage of its current user base stems from outside China, stating that the company currently does not break down those figures.

Tapping the Tencent ecosystem

Tencent’s suite of advertising solutions is intended to provide previously unavailable opportunities for advertisers, enabling brands to engage Chinese customers globally and to offer an easy all-in-one advertising hub and solution leveraging both domestic and international traffic.

Ho also stressed that the company is not seeking to replace the work currently done by advertising agencies, adding that the team works closely with many agencies to offer insight and support for campaigns.

Key advertising products offered by the company include the WeChat Official Account Banner Ad, which redirects users to an external URL through a single click, WeChat Moments Ad, a unique native social feed style display ads for a non-disruptive experience and Mobile Qzone Friend Newsfeed Ad which manifests as either an article or a video and is shown in a similar format as friend posts. 

The company is confident about its targeting capabilities and accuracy, thanks to its dominance in the social-networking segment, where it has over 90 percent penetration. Ho says the company’s targeting is based on five core pillars: demographics, environment (device/network), keyword search, user behaviour (apps used) and interest.

“Anybody going online in China is using one of our products and we use a single login system, so we’re able to understand user information in terms of how they interact and consume content,” he adds.

Brands with official WeChat accounts could place advertisements themselves, as the company does have a self-service platform to enable brands to choose the exact accounts they want to target. It also enables users to place orders through the ads, process payments and track ad performance. 

But Ho says it would be more fruitful for brands to directly engage and work with Tencent as beyond the available formats on the platform up for grabs, he adds, is the opportunity for brands to leverage behavourial insights in order to explore creative and innovative ways to engage with users.

“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 adds. “There’s an understanding about how big the opportunity is and brands want to capture that but may now have all the information available, that’s where we come in, to educate the market.”

He stresses that the company does not intend to “take over” from the work agencies already active in China do, but rather to explore ways of how the company can complement the work they do.

In terms of common misconceptions encountered during meetings with non-Chinese brands and marketers, Ho says the biggest challenge is how to reach users in a completely new ecosystem.

“From the first stab into the China market, brands face a question mark over which service or platform to use,” he says. “How do they even get started? We want to help brands understand the size of the market.”

Another key difference for foreign brands to wrap their heads around is the way Chinese consumers use apps versus other markets. For example, with Weixin or WeChat, it is a chat app but it is also much more than that and users can use it to do everything from connecting with friends to paying bills.

“Where Western markets lean toward a multi-app approach, in China is it a single-app centric market,” adds Ho. “It is hard to find a Western equivalent for this and we want to help brands navigate not just the large user base but also the range of potential use cases that can lead to engaging campaigns.”