Tencent to focus WeChat on markets where competition isn't entrenched
China’s Tencent isn’t letting up on international marketing for its WeChat mobile messaging app, but signaled its plans to avoid competing in markets where rivals such as WhatsApp already have a strong user base.
Growth for WeChat, also known as Weixin, continues to remain strong, with its monthly active users reaching 355 million in the fourth quarter, Tencent said in an earnings call on Wednesday. The high growth marks a 121 percent increase in user growth year-over-year.
Many of WeChat’s users come from Tencent’s home market in China, where the product has become one of the most popular mobile apps. But starting last year, Tencent launched its biggest international marketing push for WeChat, promoting the app in 15 other markets including Brazil, India and Mexico.
Tencent spent up to US$200 million last year on WeChat’s overseas promotion, said James Mitchell, the company’s chief strategy officer.
“For 2014, we will probably be spending a similar amount,” he said. “But we will be targeting it more on markets, where we see traction and opportunity.”
He added that the global campaign took off in certain markets, but other countries proved “less hospitable,” without elaborating.
WeChat is just among several mobile messaging apps vying to attract users across the world. In February, Facebook announced it would buy rival WhatsApp, in the hope it could grow its user base from 450 million to 1 billion.
Similar messaging apps such as Japan’s Line and Korea’s KakaoTalk are also expanding across Asia, where Tencent’s WeChat is hoping to gain users as well.
The Chinese company, however, expects it will take time for WeChat to gain more prominence. New apps, no matter how good they are, will struggle to make “dramatic progress” in markets already dominated by a rival product, Mitchell said.
Tencent will instead focus on markets where WeChat is already gaining ground, or on “greenfield markets” that have less competition, he added. Mitchell noted that WhatsApp is well established in Germany, Spain and Mexico.