China’s Tencent And WeChat Ready To Make A Big Play For U.S. Advertisers

China’s leading social media and commerce developer Tencent is expanding its reach to Chinese-speakers in the U.S. as it seeks to challenge Google and Facebook  on matching advertisers and consumers on a more global basis.

Tencent will make its official U.S. marketing debut during the Advertising Week New York next week. The company, which runs the popular WeChat messaging app, will showcase of a new suite of advertising solutions and resources that enable U.S. marketers to directly engage Chinese consumers on Tencent platforms both in China and while they travel abroad.

These new offerings and the establishment of a dedicated U.S.-based support team provide U.S. brands and agencies with unique and powerful ways to capture attention, drive brand preference and increase sales among Chinese consumers.

Why should U.S. businesses pay attention?

As Tencent points out, Chinese tourists visiting the U.S. spent roughly $35 billion in 2016 alone.

According to the U.S. Travel Association, the average spending per trip of a Chinese traveler in the U.S. is higher than any other international traveler, and shopping is a key activity for Chinese outbound tourists.

“For U.S. advertisers, China presents a dynamic, lucrative and challenging opportunity. Brands have become more sophisticated about the needs and behavior of Chinese tourists. To make a sale outside China, they understand that they need to speak to their customers before they even plan their trips,” said Poshu Yeung, VP of International Business at Tencent.

Over the past few months, a few select U.S. brands were invited to use these new advertising solutions, including the largest mall operator in the United States, Simon Property Group, and popular women’s fashion brand, Rebecca Minkoff.

“Tencent and WeChat’s new travel targeting and advertising solutions provide us with an unprecedented opportunity to directly connect with Chinese travelers, both in China and when they visit the U.S.,” said Kristen Esposito, Simon Property Group Vice President of Tourism and Marketing Alliances. “China is projected to be the largest overseas inbound travel market to the U.S. by 2021, so the potential for growth is truly extraordinary.”

The connection between U.S. brands and China’s social media platforms could produce a lucrative exchange that allows American advertisers to expand their reach beyond U.S. borders.

In terms of the size of China’s social media usage, More than eight in 10 internet users in China, or 626 million people, will access social networks regularly in 2017, according to an eMarketer report this summer.

eMarketer has raised its previous estimates for social network user growth in China by more than 4 percent, mainly because of older users increasingly using homegrown messaging platform WeChat to perform a myriad of tasks that reach far beyond messaging.

For example, 62 percent of internet users ages 55 to 64 in the country will be social network users this year—equating to 28.8 million individuals.

Since its launch in 2011, WeChat has evolved into what eMarketer called a “must-have” app in China. As messaging apps in the U.S. are still slowly expanding into commerce, WeChat has pioneered the format to be used for shopping, food delivery, even booking a doctor’s appointment and paying bills.

“WeChat’s further expansion into the areas of payments, shopping and general utility have proven fruitful for China’s social networking and messaging giant,” said Monica Peart, eMarketer’s senior forecasting director. “And it will only increase the attraction for new mobile users and older users, as WeChat increasingly has something for everyone.”

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