Tencent and Alibaba are beginning to compete more aggressively for the favor of mobile consumers throughout China
China has become a battlefield when it comes to mobile commerce competition. Two of the country’s largest companies, Tencent and Alibaba, have a longstanding rivalry with one another when it comes to engaging consumers. Both companies are beginning to focus on the mobile space more heavily as well. While Tencent has held a strong presence in the mobile space for some time, Alibaba is beginning to threaten that position by promoting and supporting mobile commerce throughout China.
Firm predicts the future of the mobile payments market in China
Internet consultancy firm iResearch has released a forecast concerning the mobile commerce market in China. According to the forecast, the market is expected to reach nearly $300 billion by 2017, with more than half of online payments being made from a smartphone or other mobile device. Mobile payments will likely continue growing in popularity as more people gain access to the mobile Internet. The popularity of mobile payments has encouraged companies like Tencent and Alibaba to embrace the mobile commerce sector more aggressively.
Tencent powers ahead with its WeChat application and new services
Tencent recently launched a new service for merchants through its WeChat application. The service allows merchants to accept mobile payments through the application, thereby enabling them to become more engaging for mobile consumers. Alibaba has its own mobile payments platform called Alipay, which has managed to accommodate more online transactions than both eBay and Amazon combined. These applications are poised to compete aggressively with one another, but Chinese consumers have yet to show their favor for one over the other.
Tencent may have what it takes to attract the support of China’s merchants
Tencent is expected to have an edge with merchants that are looking to get involved in the mobile space. WeChat is one of the most popular applications in the world and is quite well known in China. The popularity of this application among consumers may be enough to convince merchants that it is the best platform for their mobile commerce interests.
Mobile games are coming to WeChat
Tencent, China’s largest Internet company, has been making aggressive moves in the mobile field recently. The company has been looking to boost the revenue generated from WeChat, China’s most popular social messaging application. WeChat is used by over half of the smartphone and tablet owners in China and the application is making its way to other markets beyond the country’s borders. Tencent believes that it can boost the revenue of WeChat by making various updates to the application and adding new features, such as mobile games.
WeChat brings social elements to mobile games
The company has noticed that mobile games are quite addictive to consumers throughout China. Tencent believes that this creates an ideal environment for consumers to compete with one another on mobile games through the WeChat application, adding a social element to these games. Users of WeChat will not be charged to play the mobile games associated with the application. There are various features that are included in these games that do come at a price, however. These in-game purchases can unlock additional content for those interested in spending money on the games they are interested in.
Consumers may make in-game purchases due to competition with friends
Tencent expects that competition will be the main reason consumers spend money on mobile games. WeChat is a social platform, allowing more than 300 million users throughout China to connect with one another in real-time. Tencent believes that the allure of “one-upping” friends could be a driving force behind in-game purchases. Those that do purchase additional content or advantages in mobile games establish a slight lead over their friends and this may encourage others to follow suit so as not to be left behind.
Consumers are notoriously fickle when it comes to mobile games
While mobile games have proven to be a lucrative sector for the game industry as a whole, consumers are notoriously fickle when it comes to this type of gaming. Few mobile games have the ability to hold a consumer’s attention for prolonged periods of time. While games like “Candy Crush Saga” manage to generate a great deal of revenue, consumers tend to move quickly from game to game in order to find a better experience. WeChat may need to support a wide variety of mobile games if it wants to generate revenue in this way.
