7 Lessons The Ascent Of WeChat

As WeChat from messenger turned to the Internet for Chinese parsing partner of Fund Continuity Fund YC Ana Hariharan. More and more founders, answering the question of which product they consider to be a model when creating your own, pointing as an example to Asia and specifically on Chinas WeChat messenger. “One app to rule all” — so dubbed Asian messenger with an audience of 889 million active users.

WeChat has long ceased to be simply an application of. The platform, created on the basis of the messenger, completely transformed the communication of Chinese people with each other and socialize online. In addition, WeChat has even changed the payment method the most ordinary daily purchases, like food.

The success of WeChat in China is limited, but everyone in the Western world felt the changes brought about by the messenger, since he made all the world look to the messenger as a platform. Should not be too difficult to see references to WeChat in any other popular messenger app from Apples iMessage platform, which builds Facebook Messenger. In addition to the enormous audience, WeChat has unique indicators according to the depth of usage. On average, users spend more than 50 minutes and use it 9-11 times a day.

This is comparable to how a single user uses all the applications that belong to Facebook. Unlike AOL and Yahoo, the Chinese Tencent, which owns WeChat, has become one of the few companies that has managed to successfully transform your messenger from desktop to mobile and make it messengerboy platform.

Partner Fund Continuity Fund YC Anu Hariharan identified seven lessons that can be learned from the success of WeChat. Tencent has launched WeChat — based mobile devices only messenger — as a side project, but in the end reinvented messenging in China.

At the dawn of creation WeChat in 2010, Tencent was already one of the leading Internet companies in China. Many Chinese grew up on a different messenger owned by Tencent — QQ. It was a popular desktop instant messenger, like ICQ and AOL Instant Messenger. In those days Tencent had about 650 million active users of messenger.

The Corporation in those years understood the growing influence of mobile devices.In 2008 QQ created a mobile version of messenger, but it included a number of “heavy”, common desktop functions — for example, the status of users and music streaming. All of them hindered the development of a mobile messenger.

Then Tencent made an important decision. Singled out a small group of developers from the team mail QQ Mail — at that time it was a key product within the messenger. These seven engineers had to develop a completely new mobile app. The first version of WeChat was ready in just three months. In 2011, WeChat has started as a simple messenger photo sharing.

WeChat was not the first messenger in the Chinese market. The leader was then app manufacturer Xiaomi — MiTalk messenger — which numbered five million registered users.

Because of the fierce competition, WeChat has not been able to obtain significant growth immediately after the launch. Soon the developers realized that the user needs to give something more than the competitors. So in may of 2011, WeChat has voice messages that allowed people to send short audio notes. They are very similar to the function in the iPhone iMessage, which appears only 3.5 years later.

WeChat also “spied” the idea of the competition — Korean messenger Kakao Talk. However, the introduction of voice messages for WeChat turned out to be a strategic. Feature has been extremely popular among Chinese users because Chinese keyboard at the time was extremely inconvenient for a set of written communications.

To dictate the message the interviewee was much more convenient. WeChat was the first messenger, which offered at once of both voice and written messages and photos in one app. This allowed the messenger daily to increase further downloads to 50-60 thousand.

Today mobile version of QQ continues to serve the youth audience in the area of 652 million users per month (data as of Dec 2016). Tencent is actively working to differentiate audiences on different platforms. QQ offers more entertainment features, such as animated videos, the tools to do the selfie users more beautiful.

WeChat is a platform that offers the user useful services for daily life. A subscription to media content, or payment instruments for the payment of any accounts.

This is the same lesson taught to us by Amazon when “cannibalizing” your book sales. The company, originally specializing in the sale of conventional books introduced the reader, anticipating the trend to digital content. Also did Uber, which has created an internal competitor to its luxury service, creating a massive offer UberX. If you do not “undermine” themselves, then with high probability it will make your competitors.

Individual user behavior can be quite different depending on what group he communicates. To select the “effect group” WeChat is closely monitoring how the user behaves to the group of his friends or among strangers in everyday life. In this case, the messenger does not rely on traditional forms of audience research such as surveys, interviews, and should not, in this issue of the competitors.

The founder of WeChat Allen Zhang has consistently built a product based on this “effect group”. Therefore, the WeChat team pays great attention to how certain features can be perceived in a group or individual user. In turn, this has increased the level of adaptation of new features by users. As soon as a significant number of people in groups begin to use a new feature, the others follow them.

Like most other social networks, WeChat understood that it is very important to solve the problem of lack of friends in the first days of use of the messenger. In the same way as Facebook in the US has been trying to find the first 10 friends to a new user within 14 days. The data of the social network of Mark Zuckerberg has shown that it is the “key” to long-term retention of users in the network.

But WeChat has achieved success in the successful socialization of users with a slightly different approach. The function “people nearby” simulated the real world — people were curious to talk to chat with strangers that are close by and also use app. This function, on the one hand, satisfy the users curiosity and allowed us to learn whats going on nearby, and on the other — contributed to the development of community.

She also helped the application to accelerate the pace of acquiring new users is more than 100 thousand people a day. Immediately after starting the function “people nearby” in WeChat allowed to export contacts and social information from the QQ new mobile messenger. Import was available only to those who have already used both of the messenger — it turned out that the owners of smartphones used them for different purposes.

This step influenced the growth activity of messenger users. By November 2011 the number of registered users of WeChat rose to 50 million, allowing him to bypass the MiTalk and become the largest app for communicating in China.

In October 2011, WeChat has a Shake. She used the GPS and sensor change the position of the screen and allow the user shaking the phone, chat with a random person nearby. Shake helped new users to get used to the platform, and was also associated with the WeChat ofline — about the same as it later did Pokemon Go. During the first month after the launch of the Shake function used by more than 100 million times.

Function has become an important growth driver and simultaneously as a creative way to build audience. Today, however, it is not very popular in China, as most colleagues and friends already communicate with each other in WeChat, and they just dont need more social connections. After running all of these important functions and facilitate communications between groups, in November 2011, the growth rate of users has updated a record, exceeding 200 thousand new users per day.

WeChat has always paid much attention to the study of what makes people to communicate with each other to give the features that they only dreamed of. In addition, the company tried to consider the cultural context of its users.

Zhang he always passionately tried to guess the internal desires of users, which lead to a particular behaviour, which often resulted in creation of features, which perfectly fit into world of users. In 2012, WeChat has introduced a feature called “Moments”. In Chinese it was translated a little differently — as “Circles”.

And allowed to do exactly that and is now “History” in Instagram or Facebook. Share your photo story with friends. But unlike Facebook news feed, comments and likes to this type of publications were only visible to the “mutual friends” but not “friends of friends”.

This feature also was not original. WeChat borrowed it from the American app for sharing photos and messages Path, which appeared in 2010. But rather than copying the entire Path, WeChat rethink psychology in the Chinese manner. It severely restricted the social activity of users of a set of several close friends.

A team of just ten people in four months managed to develop about 30 versions of “Moments”, WeChat, before settling on one and run it. This case shows the efficiency with which implemented innovations in the product Chinese messenger. WeChat all the time kept the development team in conditions close to misery, so they focused on the product, which is developed.

Although with time the messenger appeared a few new features – grocery functions of WeChat not suffered changes since the advent of the messenger of the light. From the outset, many WeChat users share content from third-party blogs and news sites with “Moments”. Team WeChat always wanted to involve this content inside of the app and allow its native manufacturers to interact with their audience.

This decision resulted in WeChat Official Accounts. Official accounts was introduced in 2012, were only allowed to subscribe to them (similar to Twitter), so the fans could thus monitor the content of their favorite stars.

But unlike Twitter or its Chinese equivalent Weibo, stars can send to your fans text, voice or video updates as a regular message in WeChat, which created the impression of a more personal, even personal communication. The result of the introduction of new accounts was the appearance of many of the official accounts of the celebrities, even though they had millions of followers on Weibo. Success forced WeChat to expand the function to cover including brands and companies.

This allowed the owners of such accounts to broadcast the right content to your audience, although the number of advertisements was limited. Official accounts also allow users to interact with service providers. From the booking of services in the home to client support in social networks.

Thus, if the Twitter or Weibo was a way to broadcast the companys position or brand, WeChat with the help of this innovation became a channel of communication with your client. The store stickers were created to give users the opportunity to diversify communication. Just as Apple introduced iMessage.

But the WeChat became the first messenger, which created the marketplace for illustrators, so they could earn the stickers. Users to determine for themselves the amount of remuneration — in the range of $25. The marketplace was also based on the principles of healthy competition between illustrators — they competed for the top places in ratings.

This, in turn, increased the quality of the stickers. One of the main lessons that teach entrepreneurs in the Y Combinator — you need to be an active user of its own product and to constantly solve their problems when using it. Despite the fact that WeChat felt quite comfortable with 300 million subscribers, the introduction of a simple function, which is not so much a user problem as the task managers WeChat, helped almost to double the number of users.

At Tencent there was a tradition associated with the ancient custom of the Canton (the ancient name of a province in the northeast of China, now called Guangzhou — Prim. Ed.). Before the Chinese new year, each Manager of the company gives its employees a red envelope. Inside a small amount of money, it is considered that the employee must spend their on the first day of Chinese new year.

As the company grew, some managers became physically difficult to give gifts. Then they were asked to create a technical solution of this difficulty. They had not even thought that it might eventually become a prototype for the new function — WeChat Red Packets.

The first version of the function was developed by a team of 20 engineers for three weeks. Now using WeChat Red Packets you can send a random or a fixed amount to their friends. The administration is beating on random “envelopes”, and the amount received by each user, also appears to be random. The only limitation — the total amount not to exceed $29 to a function is not used for bribery.

The function was tested among owners of the official account WeChat. Instead of having to test many versions of one function, the command messenger is often tested among their loyal users. Sometimes new mechanisms tested in the night “single user” to at a very early stage to identify all the bugs.

Staff WeChat also test all the updates to their friends and relatives to understand user behavior. As a result, immediately after the launch of WeChat Red Packets on the eve of 2014, about five million people have used the new feature. Because users get a random amount of money as a gift within the group of his friends, this makes the function somewhat similar to a fortune cookie.

Youll never guess how much money you will get before you open the envelope. Get more rest — a sign of good fortune in the coming year. This feature is demonstrated once again as a “group effect” helps to introduce new features.

In the next new year — 2015 — number of sent cash gifts exceeded one billion. This “playful” feature turned out to be a very important step to build customer confidence in mobile money transfers and tracking their behavior. Subsequently, it is possible to allow transfers and payments to unfamiliar people, for example, sellers, online and offline shopping.

The development of the payments infrastructure was further supported by a partnership with the Chinese version of the Uber — Didi. The taxi service was one of the first allowed to pay for their services inside the messenger. Followed by other companies — from mobile operators to public services, which have helped to pay the bills through WeChat.

In just two years, WeChat Pay is the name given to the new payment system became the most powerful player in the Chinese online payments. In 2016, Tencent had about 600 million active users per month, which were performed daily on average 600 million payments.

The increase in the number of users and monetization are not mutually exclusive processes. WeChat has always been ready to monetize your product and even uses monetization as a way to improve the product. Games store messenger WeChat Game Center connects with other Tencent products, allowing all users of the Internet corporations to play inside the app. On the interface it looks like the game stores in the Japanese Line and Korean rival Kakao, WeChat but raised the game of socialization to a new level.

This little change was nice, and the creators of the games, and helped himself WeChat. For example, Tencent game called Rhythm Master had about 700 thousand active users per day after launch, when it was included in Game Center, their number has increased more than 20 times. Up to 17 million.

Launched in January 2015 native advertising “moments,” WeChat has become an important part of the business model of the messenger. To minimize negative impact on user experience, WeChat has limited the number of ads for every smartphone owner to one entry per day. For comparison, Facebook shows its users one ad in the feed for every ten ordinary.

WeChat users interact with ads, exchange with each other, which is quite unusual for other social networks. At the same time, likes and comments you can see only mutual friends, but it does not prevent individual ads to under two million hits.

WeChat even adapted the classic coupon model to the users themselves advertise each others products and services. The user can share the discount coupon received at offline purchasing, with their friends and they will receive the same offer. Vendors are also encouraged users for “sharing” coupons, vidavav new coupons.

WeChat initially challenged the widespread view that growth is primarily growth in the number of users. Instead, companies have always thought about growth as increasing “cost” of their product. For example, should increase the number of tasks that people can solve in daily life with the help of messenger. Unlike other social networks, WeChat does not measure the number of its users, or sent messages.

The focus is on the measurement of how deeply a product is involved in every aspect of life of its user. And although the team WeChat even have KPIs, these data are usually distributed among the heads of departments. Engineers apps every day get the message.

“Create new value to users WeChat?”. In support of this goal, the application limited the number of friends that can be added by each user, the number of advertising posts and so on — all designed to reduce the amount of “noise” that distracts from the functionality of the messenger. When adapted WeChat QR code, it led to the boom of services at the junction of online and offline into the Chinese market.

To do this, the user have to enter or look up the website address of the company or brand in order to know something about them. But now QR code has become a “symbol of abundance of information online that applied to the offline world”. In the US QR codes have become so popular for three reasons.

The main smartphone and the social network did not know how to scan them; for that people had to download a separate application; the first attempt brands use them to promote not crowned with success, since the advertising content at the time was more like spam. Thus, although marketers in the United States and dreamed of the widespread implementation of QR codes, where they proved to be too premature. Following the introduction of QR codes WeChat launched a “Mini-apps”, as a continuation of “Official accounts” to give users the ability to receive services is seamless, without the need for a separate app. So, this tool allows you to open embedded inside the messenger app to perform certain actions — for example, to pay for purchases.

Now the restaurants and shops didnt have to spend money to create their own applications. Instead, they could become a part of the WeChat platform, where they will be looking for through social interactions, or offline by scanning QR codes.

The WeChat team said that such tricks allow you to improve the conversion rate of views to actual purchases. Although most of these custom cases is much inferior to the exchange of messages via messenger. One of the main ideas of WeChat, which is the basis of all product, is that the messenger should be a “tool” that adheres to the practical features — easy to use, vysokopoligonalnaya, speed.

The majority of productlogo focus on how to create “stickiness” function that will keep users. And the creators of WeChat was worried about that user, on the contrary, will spend too much time with one function, thereby detracting from the “valuable” things. For example, paying bills.

WeChat believes that a good product should stimulate the efficiency of the user, giving him the ability to quickly solve problems, and to leave the app. Zhang, the Creator of the messenger, often cited the example of Google. Once the user finds the desired link in the search engine, Google immediately redirects the user to the desired website.

Of course, a pleasure to watch, as a user of WeChat is ready for hours to view including advertising content in “Moments”, but the team was worried that the user too much time to spend there, and the poor quality ads will begin to push him away from the whole product. Thus, it was decided to limit the amount.

WeChat also has restricted the number of messages from brands, which can be sent to their subscribers every day. These messages do not have a particular push notification, so as not to negatively impact on user experience. Despite all the many and varied functions and services that are available to the user in WeChat, the product team continues to maintain a very simple interface.

The app has just four buttons. “chat” “contacts” “open” and “I”. Experiments on the implementation of additional buttons showed that the conversion rate for each of them is reduced by 20-30%.

The WeChat team managed to find a way to stay multi-tasking, to compete with myself to create functions that meet user needs, and learn to focus on group interaction. And most importantly. During the whole time she was focused on creating a simple tool that will suit any user mobile devices.

WeChat in China is not just an app, this is the Internet. That is why the messenger inspires many aspiring entrepreneurs.

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