Ecosystem building is a central strategy in the success of the Chinese tech giants. Tencent has accelerated development into this space by launching Mini-programs to the public in January 2017 on its messaging app WeChat, quickly followed by Alibaba on mobile payment app Alipay.
Originally called ‘app accounts’, they were renamed after Apple prevented WeChat from using the term ‘app’. Mini-programs function very much like apps on the Apple iOS and Google Android app stores. However, they are less data intensive – addressing painpoints such as the lack of phone storage space, and are found “on the go” and accessible via the cloud.
As a one-stop, all-in-one platform, Chinese giants have been able to embed themselves in all aspects of a consumer’s life, collecting data at each touchpoint to better market and sell new offerings. Tencent has been one of the most advanced players in this space with WeChat hosting a diverse set of services in-app: from food delivery, ride-hailing, bill payments, and more.
Now, Tencent is pushing Chinese consumers into a software-based age with the capability to access what they want, whenever they want, simply through WeChat. It parallels Apple’s development of the App ecosystem with its iPhone.
Mini-programs are significant as they can empower O2O (online to offline) transactions and interactions by connecting WeChat and the real world in more powerful ways. For example, Tencent made a deliberate effort to not centralise mini-programs via an official store. Instead mini-programs were built to be discovered when needed. In line with this, Tencent was in closed beta for a location-based mini-program advertising bidding platform. Users accessing mini-programs in WeChat can search for “Mini Programs Nearby” and get offered mini programs based on their location and other metrics, including age, gender and operating system. Today, mini-programs have grown to over 2,000 different varieties encompassing over 10 different categories such as finance, travel and leisure services such as movie ticket bookings.
Not to be forgotten in the continued battle for Chinese customers, Alibaba also expanded into the mini-program space, launching it for their payment app Alipay. Whilst largely similar in function to WeChat’s mini-programs, Alipay’s mini-programs have an additional advantage: their ability to integrate with Ant Financial’s various financial tools such as its Sesame Credit system and identity certification feature. For example, bike-
rental platform Ofo (which Alibaba has invested in) offers new users with a Sesame Credit score of 650 or higher the ability to register for the service without making a RMB 99 deposit (US$15).
Thus by offering a fast, seamless and all-in-one experience for consumers via a common platform and integrated with their various business investments, Chinese tech giants are strengthening their ecosystem business model.