WeChat Mini-Program : THE New E-Commerce Solution in China

In 2019, Wechat mini-programs are really a Hot topic in the e-Commerce ecosystem in China.

WeChat reaches 1Million mini programs, (half the size of Apple Store)

What are these mini programs ? 

Wechat mini-programs are actually like apps that are already included in the Wechat platform. It is like a « subprogram » in the Wechat ecosystem. It is the lighter version of a regular APP. These programs offer many services. The main advantage, of course, is the convenience as they are already included on WeChat APP, so there is no need to install another APP to open the program. And because it is a « mini » program it does not require a lot of storage space.

Among the various types of mini programs, the most frequent are : 

  • E-commerce program (the most interesting for marketers)
  • Video Games
  • Music
  • Videos 

WeChat mini-programs in the philosophy of the company is based on the desire to make Wechat even more practical for its users. Make sure all users’ apps and cravings are one click away. A bargain for e-commerce business marketers who see it as one more way to get closer to their target.

The strategy of simplifying user life is also very clever because it allows WeChat to monopolize the user on its platform rather than downloading other applications. All this to generate more and  more traffic and a monopoly to the important giant Tencent.

Wechat was the ideal platform to launch the mini program because with more than one billion active users per month of the application (https://www.businessinsider.com/wechat-has-hit-1-billion-monthly-active -users-2018-3) and the omnipresence of Wechat in China, It was the most relevant company to carry out this project.

Mini Program VS your own App

The main difference between a classic application and WeChat mini program is based primarily on the instantaneous aspect of the application and its simplicity compared to an application that will take longer to load to display a more complex page.

Undoubtedly the mini e-commerce program worked well, the Chinese having already adopted the changes brought by the innovations in the digital, and the market of the e-commerce being already well established in China and in particular on Wechat.

The WeChat mini programs are decentralized, meaning that there is no space for searching all the mini programs, the user can use the Wechat search bar, the user can receive recommendation from WeChat to discover new programs based on their location but they can not find it by a approximative research (by theme or keyword for example).

Why making a mini-program?

The mini-programs provide a new way for businesses to contact customers, and offer them a new experience, easier to access, less constraining.

The possibility of being able to invest more cheaply in a program allowing customers to discover a service or products is very attractive and it is indeed a good idea especially for companies wishing to “test” their offer before going for the creation and the implementation (more expensive) of an application in its own right. Especially for startups whose budgets are often tight on project initiation. Notably since with a classic application it is necessary to adapt the application according to the operating system (IOS or Android) whereas with this development in WeChat mini-programs, it is automatically adapted to different types of OS. However, these mini-programs can also be used by multinationals already well established to create easy access to their platform for customers reluctant to install the independent application.

User Friendly

In addition, the application is managed by Wechat, it is faster, navigation from one page to another is often more fluid than an independent application. A real advantage for companies that optimize the time customers spend on their program. This is all the more true as the competition in e-commerce is strong and a fluid site allows to keep the attention of the customer rather than guide him to a competitor with a slow application with a laborious load.

Since the mini-program is integrated with the WeChat platform, it is easier for the program to access data that is interesting in terms of data, which also improves the company’s targeting capabilities and the analysis of actions. But this also optimizes the experience for the customer (easy access to payment for example, or discount vouchers).

With a successful mini program, the customer seduced will be more inclined to download the independent application (if it exists) to have access to the full experience and -why not- have access to special offers on this platform. In addition, it leaves a feeling of great freedom to the customer, especially for services that he doesn’t need frequently enough to download the application. For example, for JD.com, which specializes in electronic product e-commerce, for a customer who needs a hair dryer, he does not necessarily want to download the application for a single need, so the mini-program can meet this need without compelling him to install an application (this is valid for other areas: travel, food delivery, taxi order, etc.). This allows you to perform a task easily and quickly.

New loyalty Program

In terms of strategy, the mini-programs are very practical and efficient on O2O (Online to Offline) simply by setting up loyalty program “E-Loyalty”, click and collect service, etc.

The mini-programs can serve as an entry point to an external app, highlighting the services of this application: the tracking of an order, special offers, obtaining invoice, …).

The mini-programs as I said above can serve as a tester for small businesses but also for large, indeed the development of these programs being less expensive and less slow, it is easy to release a novelty, change an aspect of site, to offer a new service, all without the client needing to download an update of the mini-program.

Some companies have even invested in the development of several mini programs to adapt to the target. Like MacDonald who has released a specialized program for kids, a loyalty card program, a restaurant order program without queuing and a home delivery program.

While mini-programs bring many benefits to businesses, they are also greatly beneficial to customers who can benefit from new ways of consuming, such as group shopping and group conversations.

What are the drawbacks ?

The first disadvantage of these programs (and it is unfortunately related to the advantages) is the storage capacity of the program on Wechat (only two megabytes). This drastically reduces the design capabilities of the developers of these programs. This requires companies to compromise on the design and composition of pages that can potentially affect the customer experience. However, this restriction of Wechat allows the fluidity and speed of these programs and their loading.

In addition, it is not possible to send a push notification to its target with a mini program and therefore difficult to engage customers. Also, the capacity of sharing your content is limited to the WeChat channels.

The ability to “discover” an application is relatively limited because no database collects all mini-programs (as Apple can do with its AppleStore for example).

Payment is easy

For the mini e-commerce program: Only WeChat Pay is available to pay for purchases, which can sometimes be inappropriate for Alipay or even credit card users.

It is necessary to have an ICP License to be able to create a mini program, which can be a disadvantage for small companies/ startup type of structures.

The validation of the mini-programs by Tencent is mandatory, and it goes the same for any modification made after the first validation. In addition, the mini program is subject to the modification that Tencent wishes to apply at any time.

What about performances ?

After a slow start, WeChat programs boomed in the first months of 2018, mostly thanks to the explosion of addictive video game programs. Today WeChat has more than a million mini-programs (which equals half of the Apple Store), 200 million DAUs and 63% of Wechat users have used a mini-program at least once.

In addition, users of mini-programs have gained confidence on the platform and feel safer now to make their purchases on these small programs. In the first half of 2018, 95% of Chinese e-commerce companies have created a mini-program for their business on WeChat (including: JD, Pinduoduo, Mogujie,…).

Thanks to this boom, investments have started to climb, mainly on e-commerce and service programs. According to newrank.cn throughout 2018, WeChat programs received nearly 4.3 billion yuan in total for their financing.

The growth of the business of companies and Key Opinion Leader through its mini-programs was very quickly the source of attraction of new investors.

Indeed, due to this fad, nearly 85% of the investments made on WeChat mini-programs were made on the first investment cycle with significant sums for a release of a brand new service and that has never been tested before (more than 50% of the investments exceeded the amount of 10 million RMB and 25% were between 1 and 10 million RMB). Investors are mainly venture capitals involved in the development of Chinese unicorns, such as IDG Capital, which was one of the first investors in e-commerce platforms such as Wish and Zhen Fund, which was among the first investors for the “Little Red Book” application (Xiao Hong Shu). The industry’s behemoths have been more shy in their investment initiatives, with the obvious exception of Tencent getting involved with the project.

E-COMMERCE OPPORTUNITIES : Comparaison with H5

Mini Programs Shops are a new way to sell Chinese people. It is slightly different compared to Wechat H5 shops in terms of capacity and development.

The differences between shop H5 and shop by mini-programs are not numerous but relatively significant.

First, the loading time (already discussed above). The program is optimized for WeChat so is necessarily faster, moreover, the number of steps between the choice of a product and the transaction are smaller than on an H5 page.

Secondly, the mini-programs are easier to find than the H5 pages. Indeed the mini-programs can be searched: by the search bar, by scanning a QR code (by the sharings but also by the QR codes found in the “offline” physical point of sale), through sharing and sending to contacts, through the official accounts of brands, by the functionality “find the nearest” using geolocation of users phones, or by WeChat post. This allows the mini-program to gain visibility over H5 pages.

Third, mini programs are integrated into the Wechat ecosystem.

Fourth, the development time, and the cost of developing the mini program versus H5.

Fifth payment methods, for WeChat mini programs only WeChat pay is available while for H5 pages, all payments are accessible (WeChat pay, credit card, …).

Sixth, it is more reliable and safe to use a WeChat mini program, since they are managed by Tencent, their optimization and therefore security is more reliable than that of the H5 pages.

Seventh, in terms of administrative and speed, the H5 pages are more interesting, because the mini-program requires the validation of Tencent for their programming and modification, the administrative aspect is therefore more laborious than for the creation of page H5 which are made independently of Tencent.

It is therefore important to evaluate the crucial points for your business to make the right choices between an H5 page and the creation of a WeChat mini program.

WeChat mini Programs you like it or not?

WeChat’s mini-programs have received a spectacular welcome, and have performed impressively over the first two years of their existence, investments are flourishing and through maturation, they promise to be able to develop even more useful and convenient features in order to optimize customer experiences on the programs. Without a doubt they will contribute to forming the e-commerce digital experience of China of tomorrow.

The creation and implementation of a digital strategy based on WeChat’s mini-programs can boost the visibility of your company in China. It is important to think about what kind of role you want to give to the platform: advertising? e-shop? Exclusive content? Or do you want to play on the presence of KOL to promote your product / services?

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2 thoughts on “WeChat Mini-Program : THE New E-Commerce Solution in China”

  1. Social commerce remains a form of commerce, but it follows somewhat different rules. Be creative! We give you some practical advice:

    Content is king! Remember that WeChat is a commerce platform with a social dimension. Provide content that makes users want to share it with their friends.
    Think of the commitment of great opinion leaders: key opinion leaders (KOL) or great opinion leaders are among the main sales drivers for Chinese products. These are celebrities, industry tycoons or ordinary people followed by a huge number of subscribers on WeChat, called wang hong. The Chinese consumer is generally more influenced by his peers than the average Western consumer.
    Be perceptive and creative in the selection of your products for your campaigns on the Chinese market. Offer special products that customers cannot purchase from other sales channels. In other words, personalized or limited edition products.
    To sum up, WeChat is the new way to access the Chinese market, to set up there to sell its products!

    If you wish to better understand and evaluate the social commerce market in China, we recommend that you contact Alain Graf, SG-E consultant responsible for China. We would be happy to work out with you a strategy to approach Chinese customers using social media.

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