Using Wechat for Business

Digital Marketing in China

Thomas Graziani from WalktheChat, 12th of April 2016

A project funded by the European Union

In Partnership With

Get Ready for China!

The EU SME Centre is an EU Commission funded project which helps EU SMEs prepare to do business in China by

providing them with a range of information, advice, training and support services.

The Centre is implemented by a consortium of six partners and was established in October 2010. It successfully

completed its first phase in July 2014 and has now entered its second phase which will run until July 2018.

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Who am I?

I’m Thomas, the cofounder of the WeChat-

focused development and marketing agency

WalktheChat

What does WalktheChat do?

We help our clients use WeChat for marketing

by:

- Designing their strategies

- Building WeChat APPs

- Driving traffic (KOL, ads, viral campaigns)

Who do we work with?

Big brands (Nestle, NFL, …) and small brands

(Startups, SME’s trying to import to China).

Who am I?

1. OVERVIEW OF THE CHINESE DIGITAL ECOSYSTEM

2. HOW TO GET STARTED ON WECHAT

3. HOW TO GROW YOUR WECHAT FOLLOWING

i. GENERATING TRAFFIC

ii. CASE STUDIES FROM LARGE BRANDS

iii. CASE STUDIES OF WECHAT GUERILLA MARKETING

4. CROSS-BORDER E-COMMERCE AND WECHAT

We have a lot to cover, so let’s get started!

What we‘ll talk about

PART 1: OVERVIEW OF THE CHINESE DIGITAL

ECOSYSTEM

MAU Y2Y

growth

Founding

date

Western

equivalent

•Facebook

•Whatsapp

•Paypal

697M +37% January

2011

•Twitter 198M +38% August

2009

•Forums

•Blogs

75M

registered N.A March 2005

•Tinder 69M +50% August

2011

•Facebook

(but dying) 44M -19%

December

2005

Source: Q2 2015, company reports and official statements

Quick overview

WEST CHINA

Integrated eco-system

OPT-IN

QUOTAS

Protected users

Protected users

Advertising Services

Service-based ecosystem

PART 2: HOW TO GET STARTED ON

WECHAT

#1 WECHAT MARKETING IS

DIFFICULT

≈

≈

A friend

account

Two

company

service

accounts

All company

subscription

accounts

A friend

account

Two types of

accounts

• Subscription

accounts can send

one message each

day and are less

visible

• Service accounts

are more visible,

have advanced

features but can

only send four

messages each

month

Two types of company accounts

Reading rates are decreasing

#2 PICK THE

RIGHT TYPE OF ACCOUNT

Subscription Service

# of messages 1 per day 4 per month

Visibility Inside dedicated folder Same as WeChat friends

Automatic answers Yes Yes

Targeted messaging Yes Yes

WeChat wi-fi Yes Yes

Customer service messages Yes Yes

Connected objects No Yes

WePay No Yes

Voice recognition No Yes

Geo-location No Yes

URL shortening No Yes

Multiple QR code No Yes

OAUTH 2.0 No Yes

Subscription & service accounts

Subscription account Service account

Needs Chinese ID +

WeChat payment

enabled WeChat

account

Needs Chinese ID +

Local company with

bank account (can be

WOFE or Chinese

Company)

Who can create them?

Subscription account Service account

Subscription accounts are a

good choice for companies or

individuals for which content is

the core service provided to

customers: ability to publish

daily is a key feature and

other features provided by the

account are more limited

Service accounts are more

appropriate for companies

aiming at providing a wider set

of services through WeChat:

customer service, e-commerce,

games, or other interactive

feature. Content can be

provided but it is not the core

service

In a few words

#3 PLAY THE SERVICE GAME

#4 DEVELOP AN USER-FOCUSED CONTENT

STRATEGY

50%

40%

10%

Branded Content Unbranded

but Related

Unbranded

& Useful

#5 LEVERAGE EXISTING

PLATFORMS

PART 3: GROWTH

PART 3.1: GENERATING TRAFFIC

“Timeline” ads “Public account” ads

Barrier to

entry

High: around RMB

10M Low: RMB 2,000

User

reaction

Violent negative

reaction Indifference

Quality of

traffic Low Low

Perception by

advertisers

Short-term

branding tool Useless

Visibility High (user timeline) Low (bottom of

other public

accounts)

CPC ads are not the best choice

YOUR CONTENT Sharable content

Action call via link or QR code

Enticing title

KOL are more efficient

Customers can get discounts if they share the brand with their friends

Using social networks as a powerful

way to get visibillity in the

competitive Chinese market

These friends can become new customers from China or during their travels Perpetuating a virtuous loop of customer

acquisition

Customers are encouraged to re-purchase products from China

Our e-commerce solution enables

customers to keep purchasing

from abroad

Customers follow our clients social networks during their trip Stores provide incentives such

as discounts or additional

services to increase followers

Social e-commerce is optimal

WeChat CPC

marketing

WeChat Key

Opinion Leaders

WeChat social

e-commerce

Minimum $20,000

investment

Low quality

traffic

Highly controlled by

Tencent

Minimum $8,000

RMB per message

Medium quality

traffic

High risk High risk

Low oversight

from Tencent

~$2,000 USD per year

for platform license

High quality

traffic

Low risk

Low oversight

from Tencent

Cost

Regulation

Traffic quality

Risk

And most cost-effective

PART 3.2: CASE STUDIES FROM

LARGE BRANDS

Shun Feng delivery tracking

LV WeChat customer service

Shangri-La hotel booking

Zara store locator

C-TRIP flash sales

Sasa cross-border platform

PART 3.3: CASE STUDIES OF WECHAT GUERILLA

MARKETING

Speciality: wine

Background:

studied wine in the

U.S and in France

Format used: video

Shen Han &

Drunk Pinguin Society

The power of videos

• Launched a monthly wine subscription

business

• 1,500 subscribers already

• Diversifying to new types of products

Outstanding results

Speciality: cosmetics

Background: UX designer

for Microsoft

Format used: articles

Jiu Tian & HiBetterMe

The power of Zhihu Wang

• Grew to 50,000 WeChat followers in 4

months

• Launched a shop on her account selling

thousands of items per month

• Now launching her own brand and raised

5,000,000 RMB for it

Outstanding results...

Speciality: everything

Background: journalism

Format used: audio

Luo Yonghao from Luoji Siwei

The power of audio messages

• Grew to 3,500,000 WeChat followers

• Launched very successful e-commerce

campaigns (2,700,000 people participated in

their moon-cake campaign)

• Used innovative strategies in terms of

products and sales model

Outstanding results…

Different growth

strategies

Different types of

content Different products

Zhihu

Videos for

students

Collaboration with

stars

Audio messages

Videos

Subscription

model

Channel for other

brands

Experiences

What’s the common point?

They did everything different

PART 4: CROSS-BORDER E-COMMERCE

WeChat and Alipay boss enable

cross-border payments

Cross-border logistic solutions

already exist

Example:

- Under the previous regulation, the products with tax below 50 RMB

were tax-free.

- New regulation removes this tax benefit. Instead, the VAT and sales tax

will apply to only 70% of the total product price, if the product is under

personal quota (i.e: under 2,000 RMB for a single purchase and bellow

20,000 RMB of purchases per individual and per year)

Cross border taxes

keep evolving

Follow Us on WeChat

Get Ready for China

www.eusmecentre.org.cn

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