Tencent’s Social Media Development

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Part 2: Company History & Philosophy

History

I want to talk about Ten Cent history. As representative, QQ is the first and most successful product in Ten Cent. In 1996, there had a popular social software and almost everyone use it. So, after one year, 1997, Pony Ma contacted with ICQ and became their member. Then he felt the ICQ charms deeply, also saw the boundedness of ICQ. One is English interface; another one is there have some difficulties on operation. So the ICQ didn’t popularize in China as a result of these two problems. Soon afterwards, Pony Ma and his college friend Zhidong Zhang founded a company. At the very start, Pony Ma and his partnership exploited a Chinese version ICQ and sold it to big company when it would get mature one day. Because Ten Cent never thought they wanted to manage ICQ because that required tremendous money. However, finally, they decided they should make their own ICQ called QQ and was published in 1999. With the development of QQ, they stood out from the competition and defeated 95% similar software. Therefore, their success, to some extent, is based on fortune in good time and powerful strength.

Marketing Strategy

“First, in overseas, since 2009, executives in charge of the strategy at Tencent have been working on the transformation of the company from a Chinese firm which service are still accessed through desktop computers for chat and games to an International firm providing mobile services and performing exceptionally well thanks to innovation and continuous efforts to improve the user experience. WeChat was designed to be a success not only in China but also in the whole world. Tencent doesn’t communicate the split of the user base per country. However, Tencent published their work showing “growth in Singapore, Thailand, Malaysia, India.” (Value2020, 2016)

Second, in China, WeChat and QQ are the product-customer combination that is close or similar to other services developed by Ten Cent: chat services and social networks. The strategy for WeChat and QQ are to develop the size of the user base with the combination of extending the coverage of the existing product/service and bringing out additional features on a regular basis with upgraded version of the application.

Part 3: Environmental Analysis

Environmental:

External environment:

Since the 1990s, with the rapid development of Internet technology, the number of Internet users in China has increased dramatically. In recent years, in order to regulate the order of the Internet industry, China has promulgated a series of legal documents. As a huge information platform, Internet users can compare and choose until they find the best. As two excellent social software, WeChat and QQ occupy China's largest market share.

Internal environment:

Tencent currently in the social software occupies an absolute dominant position, has a wealth of resources. The number of people using WeChat and QQ is more than one billion, which makes people's lives more covenient. Moreover, Tencent has a high income, adequate reserves of funds.

Social & Cultural:

Now, WeChat and QQ have more and more features, they have not only for the communication between relatives and friends. A lot of new and interesting features have brought us happiness, but at the same time there are some problems.

Micro-business:

Micro-business is a mobile social business model. It is a new type of electric business which enterprises or individuals sell products in the social platform. With the rapid development of mobile shopping market and micro-business circle of the ever-expanding, micro-merchant size and market size has maintained a rapid growth trend. However, due to lack of regulation, the market is very confusing. A large number of fake and shoddy goods sold online, brought a lot of damage and loss to the consumer.

WeChat public number:

At present, because the network information is very complex, WeChat public information dissemination often involves fraud, people no longer believe that the information platform. This is is a very big loss for Tencent, after all, it lost a very good publicity channel.

Competition:

At present, in China's social software, WeChat and QQ occupy an absolute advantage. Both of them belong to Tencent, so there is no competition between them. At the same time, due to network constraints, Facebook and Twitter can not be used in China, so their advantages are more obvious. However, starting from last year's Spring Festival, Alipay began to get involved in social software, brought some competitive pressure to WeChat and QQ. This pressure will continue, but the effect is not obvious. Because people still used to use WeChat and QQ.

Part 4: Description of Target Market

Target Market:

WeChat payment is integrated in the WeChat client payment function, the user can complete the fast payment process through the phone. The WeChat payment is based on the fast payment of the bundled bank card, providing the user with safe, fast and efficient payment service. At present, this is the direction of WeChat development. Whether it is WeChat Red Pocket, or micro-business, are related to the payment method. So Tencent began to get involved in this area, and has achieved good results. Last year, WeChat payments accounted for 32% of the share in China's payment market.

Potential Consumer:

According to the latest report, the average age of WeChat users is only 26 years old, 97.7% of users under 50 years old, 86.2% of users between 18-36 years old. So this means that the use rate of WeChat and QQ in the elderly population is not high, there is a lot of room for development. This part of the crowd is still accustomed to more traditional social way. At the same time, Tencent also need to consider more overseas Chinese groups, and play more roles in the process of communication among overseas Chinese. (Wallstreetcn.com, 2016)

Part 5. Analysis of Marketing Mix

Product

Figure 2 QQ and WeChat user yearly growth comparison chart:

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