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WeChat and the Future of Omnichannel


9 May 2018

Victoria Galloway

6 minute read

What WeChat’s success tells us about the future of omnichannel.

Blogimage Wechat Blogimage Wechat Placehoder

In 2017, people in China are projected to have spent over US$1.1tn on online retail, according to eMarketer. Add to this the fact that China is also the world’s largest mobile-first economy and it’s easy to think that being online is the formula for success in China.

But wait - there’s more to the Chinese opportunity: The omnichannel experience.

Omnichannel is taking centrestage in China, led by pioneers such as Alibaba founder, Jack Ma, who told his shareholders in October 2017 that, “Pure e-commerce will be reduced to a traditional business and replaced by the concept of New Retail - the integration of online, offline, logistics and data across a single value chain.”

As eCommerce in China achieves unprecedented penetration, big brands with brick-and-mortar stores are innovating by fusing in-store shopping with mobile payments, apps, social channels and most important of all, WeChat accounts.

In other parts of the world, consumers would typically tap and pay for a coffee, hire a cab via Uber, and shop on an eBay or Amazon app. But in China, consumers do all this and more by using just WeChat!

How WeChat gave rise to the ultimate omnichannel opportunity in China

WeChat might have started as a voice messaging platform in 2011 but it has evolved enviably into the very pinnacle of omnichannel shopper engagement in China. The secret behind its success is that it not only helps consumers do product research and find recommendations, but it also offers them instant avenues to put these decisions into action.

Today, WeChat’s 1 billion users have access to over 10 million internal ‘mini apps’ via its integrated messaging app, online browser, and social media platform where they can share, browse and buy.

According to Chinese Micro News, WeChat boasts a highly engaged user base:

  • 94% of WeChat users log in every day
  • 61% use it more than 10 times a day
  • 36% log in more than 30 times a day
  • Users spend an average of 66 minutes on WeChat every day (for reference,  Facebook’s average is 50 minutes)

With these numbers in perspective, it’s easy to see why big brands who harnessed WeChat early on in China are already reaping the rewards.

Starbucks is a shining case in point. Belinda Wong, CEO of Starbucks China, credited 29% of all Starbucks transactions in China to WeChat pay. Encouraged by this success, the brand is now experimenting with numerous other omnichannel experiences in the Chinese market.

While brands love WeChat for omnichannel opportunities that have resulted in higher footfalls in stores, customer loyalty and sales growth, consumers love WeChat for the convenience it offers.

WeChat’s omnichannel marketing capabilities and lessons for Australian businesses

An integrated online browser, direct interactions with brands, integrated social media platform, geotagging options, and a payment app - WeChat has everything it takes to create a refined omnichannel experience.

Let’s take a look at how numerous beauty, luxury, and apparel brands are leveraging WeChat to boost user engagement, sales, and loyalty.

  • British luxury brand Burberry earned high user engagement and sales during Chinese New Year 2016 by sending all its WeChat followers an image of a rolled greeting card tied with a pink bow. Users had to ‘Shake, tap and swipe’ to try and open the gift. Once they opened the letter, they could then send their friends a personalised Burberry greeting and also directly shop from an exclusive collection within Burberry’s WeChat store.
  • Under Armour, a fitness apparel brand, offers its WeChat followers registration for fitness classes directly through the platform. Users can then earn loyalty points for each class they attend. Finally, to close that sale, users have the option of redeeming loyalty points via WeChat when they purchase Under Armour products.
  • Japanese apparel brand, Uniqlo, used an online-to-offline (O2O) campaign to boost sales with their “Style your Life” initiative. As part of the campaign, shoppers could try on clothes and then have a picture taken in the store against attractive backgrounds such as New York or Tokyo. They could directly share this picture with their friends on WeChat Moments. The helped Uniqlo drive sales and grow their follower base.

With WeChat’s reach extending to 1 billion users and counting, there are now fewer reasons for brands to leave WeChat out of their multichannel or omnichannel plans.

WeChat payments: The WeChat app that changed the omnichannel strategy

WeChat’s payment app, WeChat Pay (or WeChat Wallet) is what allows users to pay for anything they want from train bookings to mortgage to eCommerce transactions. It functions like any other digital wallet but it has two unbeatable advantages:

  • Seamlessly integrates with thousands of WeChat’s internal apps
  • Consumers can use it to pay for anything through in-app purchases, using tap-and-go, or by simply snapping a picture with their camera

This convenience has driven millions of people to WeChat in China - 600 million, to be precise! That’s 150 million more users than Alipay, which was the market leader until as recently as 2014.

WeChat has successfully managed to turn the game by weaving its functionalities into users’ daily lives and giving brands and services a chance to be seen at the right place. These elements, tied together by a seamless payments system have made WeChat self-contained in the true sense.

WeChat is everywhere and users in China use it to get virtually anything done, to the extent that industry experts jokingly refer to WeChat as the “Swiss Army Knife” of digital platforms. We concur!

WeChat payment Australia: Is there a future beyond the Chinese shopper?

While WeChat has been wildly successful in China, consumers in other big markets such as the United States and Europe are yet to wholeheartedly accept messaging apps as eCommerce or mobile payment platforms. But with analysts saying that 24 million Americans are poised to use WeChat by 2020, a new trend could well be on the horizon.

Closer home in Australia, the growing demand from Chinese tourists has led several businesses to consider WeChat as a new channel for business. With Chinese tourists expected to spend AU$13 billion in Australia by 2020, this is an opportunity too big to ignore. But it’s not limited to tourism. A number of Australians are using WeChat to stay in touch with family and friends too.

The biggest challenge, however, is that WeChat Pay cannot yet be linked to banks outside of China and some neighbouring countries (like Hong Kong, Macau, and Taiwan), so WeChat’s global expansion is still heavily dependent on Chinese consumers abroad.

Platforms such as WeChat are a small but vital part of the exciting payment trends that will soon result in channel convergence, creating a strong need to offer your customers a single experience across online, in-store, mobile, and in offline services. Bambora can help you stay ahead with our capabilities spanning the latest and emerging payment methods. Get in touch with the Bambora team today!

About the author

Victoria Galloway is Bambora APAC's Technical Copywriter, and has been writing and producing in the payments and eCommerce space for a number of years in the UK and Australia.