Tencent introduces advertising on its social networking app WeChat

By Hu Weijia Source:Global Times Published: 2015-1-21 23:38:01

WeChat, China's most popular social networking app developed by the country's Internet giant Tencent Holdings, started to try out advertisements on Wednesday, a move analysts said is expected to bring huge income for Tencent.

A large number of WeChat users on Wednesday received the first ads in their app's Moments section, where users share information with friends, similar to Facebook's timeline.

The advertisements came from an account named "WeChat team," which is automatically added to users' friend list and operated by Tencent Holdings as displayed on the account label.

The first ad seems to be a test message by Tencent itself, saying "ads can be a part of life", without any marketing material specific to a brand.

"This program [mobile marketing] in the Moments section is still at a testing stage and the formal one will be launched soon," a PR staff from Tencent confirmed with the Global Times Wednesday.

The company did not disclose how it will help its clients spread their ads among WeChat users.

WeChat's advertising service is expected to bring huge income to its parent company, as domestic enterprises have increasing passion for advertising on mobile Internet platforms, Lu Jingyu, an analyst with Beijing-based consulting firm iResearch, told the Global Times on Wednesday.

In addition, compared with other social networking apps, WeChat is a more appealing platform in terms of user numbers, Lu said.

Latest data from Tencent's website shows that WeChat had accumulated over 468 million monthly active users by the third quarter of 2014.

According to the Xinhua News Agency, Weibo, a major rival of Wechat, had gained 167 million monthly active users as of September.

The total income from WeChat's advertising project could reach 10 billion yuan ($1.6 billion) annually, domestic news portal The Paper reported on Wednesday, quoting unidentified sources.

Tencent's online advertising revenue grew 75.5 percent to 2.4 billion yuan in the third quarter of 2014, mainly from its instant messaging platform QQ and video business, according to the company's financial report published in November.

QQ had 820 million monthly active users in the third quarter, according to the report.

Different from the strategy of placing low-end ads on QQ platform, Tencent is expected to choose big-name advertising for WeChat, which will likely pose some difficulty at the initial stage if the price is set too high, Lu said.



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