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Review of the Chinese Internet Leaders and Environment

Thanhtu Dao // Last Updated: 31 August 2015

From ALS Ice Bucket Challenge to Chinese Social Media

“ALS Ice Bucket Challenge” has been popular throughout the summer of 2014. The first Ice Bucket Challenge reported is the one did by golfer Chris Kennedy on July 15. He then challenged his cousin, Jeannette Senerchia, whose husband had had ALS for 11 years. Senerchia was filmed getting poured by cold water on the next day, and through Facebook connection, some people, Pat Quinn, a 31-year-old Yonkers and ALS patient from New York, included, followed suit. Quinn’s Facebook network overlapped with Peter Frates’, who was the former captain of the Boston College baseball team and diagnosed in 2011. He took up the challenge and tagged some local athletes on Twitter to get poured. From then on, it went big. Many celebrities from different areas, such as George W. Bush, Taylor Swift, and Kobe Bryant, took up the challenge. And soon, the founder of Facebook, Mark Zuckerberg, tagged Silicon Valley celebrities, Bill Gates, Tim Cook, etc., and thus the challenge came into sight of Chinese public. In mid-August, Lei Jun (founder and CEO of Xiaomi Phone) and Liu Zuohu (founder and CEO of One Plus Phone) first took up the challenge and uploaded their videos to Sina Weibo to challenge others. Soon, the challenge spread among celebrities of different areas and went viral on Chinese Internet, too.

Aside from the significance of this activity in helping ALS patients go gain attention of the general public, social media is another great factor in the success and popularity of this activity in China: users of Sina Weibo posted and reposted celebrities videos of the challenge; WeChat users also posted their own challenges on “Moments” of WeChat, posted and reposted the diagram of links between celebrities challenges; there even emerged an Official Account for ALS Ice Bucket Challenge specially, posting videos of celebrities pouring cold water on themselves, posting articles analyzing the marketing strategy behind the challenge or explaining the link between the challenge and other social phenomena; Zhihu users asked and answered questions about ALS, and gave in-depth comments on ALS Ice Bucket Challenge and knowledge on ALS…All kinds of social media were flooded by ALS Ice Bucket Challenge and helped make the challenge a great success also in China.

Now let’s look at those social media.

The challenges started from Facebook and twitter in America. Speaking of Facebook, young netizens in China may think of Renren (http://renren.com/). Renren’interface is basically the same with Facebook’s. But their functions are not quite the same. From company level, Facebook mainly focus on social interaction among users, whereas Renren may shift some of its focus to Jingwei (similar to Linkedin), Nuomi (a B2T or group purchasing website, where the products and services provided by third-party companies are all on discount because many netizens are buying the same product or service), and Renren Games. As to content in the two social networks, Facebook users prefer to share their own life, while users of Renren like sharing other people’s news. Because of the last two differences, Facebook can retain old users and attract new users through their connections with old ones, but users of Renren, on the other hand, are not so sticky to Renren because of its weakened focus on social needs. Another difference is that active users of Renren are mainly university students and as these students graduate from universities, they gradually turn to other social networks. All this adds up to the great gap between Renren and Facebook in terms of popularity.

The challenges first started in Sina Weibo (http://weibo.com/) in China. Chinese Weibo and American twitter are very much alike. Users can “follow” family, friends and celebrities on Weibo, so that they can see, comment, repost, or “like” the words, pictures, links to articles, videos, etc. posted by those they “follow”. The most prevalent Weibo is Sina Weibo. Usually, the content people post on their Sina Weibo is about latest information of celebrities, especially celebrities in amusement circle, real life scenario of netizens, anecdotes happening daily around people, etc. As we can see from the Ice Bucket Challenge, as Sina Weibo has attracted more and more users among celebrities, it is now kind of a platform for the general public to know about life of celebrities. The company it belongs to, NASDAQ: SINA, is one of the four largest Portal Webs (an example of Portal Web would be yahoo in America) in China, the other three being NASDAQ: SOHU, NASDAQ: NTES, and Tecent. SINA mainly provides five lines of service: SINA News providing current news around the world, sports information, entertainment news, and news on IT field, finance, estates, etc.; SINA Mobile providing wireless value-added services, including short message, multimedia message, WAP, etc.; SINA Community providing platforms for users to interact, such as SINA Blog, SINA Weibo, SINA Podcast, SINA Forum, and SINA Email; SINA Enterprise Services, including search engine service, enterprise mailbox, information of industry, etc.; and SINA E-commerce, providing online shopping, online payment services, and information about Chinese e-commerce, etc.

As for Zhihu (http://www.zhihu.com/), it’s an online Q & A community that is linked to elites of all areas and industries. After registering on Zhihu, users can ask questions of different fields, and get answers from those elites who have professional knowledge, experiences, and insight in regards to those questions. Zhiwu was launched in December 2010, and opened for public registration in March 2013. Now it has millions of users, most of which are young netizens in their 20s or 30s. Zhihu also has APP version. And because of its high-quality Q & A, Zhihu launched another APP, Zhihu Daily, in May 2013. Every day, Zhihu Daily recommends dozens of high-quality answers or comments related to all kinds of areas to its users. 

Now comes WeChat. WeChat, launched by Tecent in 2011, is a free instant messaging APP. Users can also log into WeChat on webpage (https://wx.qq.com/) by scanning the QR Code on the webpage with their WeChat APP. Combining the features of QQ and Weibo, WeChat has become a most popular social medium in China these years. Other products and services of Tecent include: QQ, the IM software with the largest number of users in China; products and services related to QQ, such as QQ Mail, Qzone, QQ Games, QQ Dictionary, Internet value-added services, QQ Music Player, QQ Video player; TM (Tecent Messenger), the second IM software launched by Tecent, and an IM software for workplace; Tecent Weibo, not so popular as SINA Weibo;  QQ browser; RTX (Real Time eXchange), an organizational level IM platform; Tecent Portal Web service (http://www.qq.com/); paipai, an e-commerce website (http://www.paipai.com/); Tenpay, an online payment platform (http://www.tenpay.com/); QQ housing estates, a website providing estates information to customers; Tecent news APP, etc.

QQ, launched in 1999, one year after Tecent was founded, is the first instant messaging software launched by Tecent. The idea of creating an instant messaging software was inspired by the ICQ: the co-founder and CEO of Tecent, Ma Huateng became user of ICQ in 1997, found its value and limitations, and decided to break those limitations and create an instant messaging software that suits the needs of Chinese Netizens. Thus came QQ, the first instant messaging software in China.

Though both are instant messaging software created by Tecent, QQ and WeChat have many differences due to the development of Internet and cellphone market, and the change of customers’ life habits and needs over these years. Firstly, QQ was originally a computer software while WeChat was created as a phone APP as smart phones has become an important part of people’s daily life. But QQ also has its phone APP version and people can also log in their WeChat on computer webpage. Secondly, people can publish words, pictures, long articles etc. in their Qzone and set authorization to allow some people to see and others not. However, With WeChat, created at a time of more rapid life pace, users can’t publish large articles. But they can write an article on other Internet platforms and then share the link to the article to their “Moments”. Thirdly, the users of WeChat are of a wide range of age group, while the users of QQ are mainly young generations, mainly primary and middle school students.

From the “Fight” over Taxi Ordering to E-commerce Platforms in China

Other than that, one major difference is that WeChat also has some functions of Alipay Wallet. That is, users can transfer money, pay their credit debts, pay their telephone bills, buy lottery tickets, movie tickets, flight tickets, manage their money, etc. with WeChat Wallet. There is yet another unique function on WeChat that needs mentioning—ordering taxi. By cooperating with a taxi-ordering APP, Didi, WeChat allows its users to order taxi with WeChat, especially when they are at some place where it can be difficult for them to get a taxi, and then pay with WeChat Wallet. And taxi drivers near them will come for them if drivers think the traffic is convenient. These functions, especially the one that can get users taxi, has been in fierce competition with Alipay Wallet of Alibaba.

As Tecent gave 100 million dollar financing to Didi in January 2014, the competition between WeChat taxi ordering and Alipay Wallet taxi ordering, which Alipay Wallet provided to users by cooperating with another taxi-ordering APP, Kuaidi), began and soon heated up. Both Tecent and Alibaba were paying some taxi fees for customers to use their APP to get taxi and also paying money to taxi drivers for each order they take so that they can get more users to use their APP for daily payment services. The competition lasted until May 2014 and cost both sides a large fortune—2 billion RMB in total. And it’s hard to tell which side has won in this competition. But it’s clear that Alipay Wallet has its advantage over WeChat Wallet partly because it already had a large number of stable users when WeChat started its payment services. Besides, with Alipay Wallet, users can also pay for purchasing in convenience stores and buying drinking at vending machines. And around December 12, Alipay Wallet launched a series of promotion activities cooperating with convenience stores by paying for discounts of customers who paid with Alipay Wallet. These promotion activities attracted many users, including some middle-aged or older people, one of the groups most remote to Internet world, and thus gained more user groups for Alipay Wallet.

Alipay Wallet is just one of the many services provided by Alibaba, the NO. 1 e-commerce company in China, and the IPO of which in America in 2014 has drawn large global attention. Other services it provides includes Taobao (http://taobao.com/) and Tmall (http://www.tmall.com/), both of which are among the most popular shopping websites in China, with Taobao being the largest C2C shopping website and Tmall being the largest B2C shopping website. Launched by Taobao in 2008, Tmall is now independent from Taobao and has become one of the leading B2C platform shopping websites and the B2C retailing website with the highest number of page views in China. Since its launch, there has been more than 70,000 brands from both home and abroad opening official flagship stores on it. These brands include UNIQLO, L’Oreal, Adidas, P&G, Uniliver, Gap、Ray-Ban、Nike、Levi's, etc. Taobao and Tmall often hold large-scale discount promotions during different festivals. In recent years, the most popular and successful discounts and promotions are the ones on November 11 (Bachelor Day, also a day when commercial companies, including e-commerce websites holds discounts and promotions). In 2012 and 2013, the total sales of Taobao and Tmall on Bachelor Day were over 13 billion and over 35 billion respectively. On November 11, 2014, the sales of Taobao and Tmall reached one million just 38 minutes after 0 o’clock, and the total sales of that day was over 57 billion. There are other e-commerce websites in China that is similar to Tmall. The most popular ones are JD (http://www.jd.com/), Amazon (http://www.amazon.cn/), etc.

Other websites related to Taobao are Ju.taobao (http://ju.taobao.com/) and Etao (http://www.etao.com/), both of which were launched by Taobao in 2010.

Ju.taobao is independent from Taobao and a comprehensive group purchase website in China. It aims at gathering customers who want the same products and providing comprehensive high-quality products and local life services at affordable prices. Websites similar to Jutaobao are JD group purchasing (http://sale.jd.com/), QQ group purchasing (http://gaopeng.qq.com/), etc. There are another kind of B2T websites or APPs in China, which provide users with life service such as group purchasing for meals, movie tickets, KTV, etc. Basically, users can search based on their location in the city or the categories (food, entertainment, hotel, etc.) of their group purchasing, and choose what they want based on distances, evaluation of other customers, and prices, all of which are provided on those websites or APPs. The most popular one of this kind is Dianping (http://www.dianping.com/shanghai), other popular ones being Nuomi (http://sh.nuomi.com/), Meituan (http://sh.meituan.com/), etc.

Etao has been independent from Taobao since June 2011. Aimed at becoming an “one-stop shopping search engine”, helping customers to make purchase decisions, and letting them find quality products at affordable prices, Etao has become a shopping search engine that covers all-around information about products, trade companies and discounts. It provides customers with services including product searching, discounts and discount searching, hotel searching, profit returning, Tao community, etc. And its searching results cover products and information of multiple B2C shopping websites and brands, including Taobao, Tmall, Amazon China, dangdang, Gome, Nike, VANCL, etc.

In association with its business of Taobao and Tmall, Alibaba launched Alipay (official website: https://www.alipay.com/)in 2004, which is now an online third-party payment platform chose by the largest population in China. By cooperating with multiple finance organization including national banks, regional banks, Visa and Master Card, it provides trade companies from both home and abroad with online payment solutions and is their first choice for online payment solutions. And the third-party credit guarantee service, allowing buyers to pay to sellers after they receive satisfying products, decreases the online purchasing risk of buyers. Aside from Taobao and Tmall, it also serves industries including online retailing, virtual games, digital communication, business services, plane tickets, public utilities, etc. And Alipay can provide payment services of 14 foreign currency, and thus can provide payment solutions to global trade companies directly selling to Chinese customers.

However, actually Alibaba was first started up as a B2B e-commerce company. The first business started by Alibaba is Alibaba Global Trade Market (http://www.alibaba.com/). Launched in 1999, it aims at creating an English-based platform for the trade between any two countries and helping small enterprises to expand their overseas market, and is one of the leading e-commerce platforms for small enterprises in the world. Alibaba Global Trade Market now serves millions of buyers and providers in over 240 countries and regions all over the world. Other websites that serve as international trade platforms are Dun Huang Website (http://www.dhgate.com/), Global Sources Website (http://www.globalsources.com/), HuiCong Website (http://www.hc360.com/), Global Market (http://www.globalmarket.com/), etc.

Other e-commerce platforms of Alibaba includes 1688 (http://www.1688.com/) and Ali Express (http://www.aliexpress.com/). 1688, former name Alibaba China Trade Market, started in 1999, has now become one of the leading trade e-commerce platforms in China. Originally intended to be a B2B e-commerce platform, 1688 has gradually developed into an online wholesale and purchase market, one of its major business segments being to meet the purchasing demands of sellers on platforms like Taobao. Ali Express, started in 2010, is one of the leading e-commerce platforms for consumers. It gathers different small enterprise sellers to provide all kinds of affordable consumption product. Ali Express serves millions of registered customers from over 220 countries and regions.

To boost the development of its whole e-commerce ecosystem, Alibaba launched Ali Cloud Computing in 2009, Ali Cloud Computing is now a developer of cloud computing and data management platform, aimed at building the first platform for Internet data sharing and providing cloud computing services centered on data. Ali Cloud Computing now mainly serves seller on platforms like Taobao and third-party users in the realm of Internet computing, with the specific services being data collecting, data processing and data storage.

There are many other e-commerce websites or APPs in China, among which there is an e-commerce website peculiar to China, 12306 railway customer service center (http://www.12306.cn/mormhweb/). It is the only official website authorized by the Ministry of Railways. Users can register with their ID numbers or passport numbers and buy train tickets 20 days (60 days during Spring Festival Transport) ahead of their travelling time. It’s a great help to Chinese train ticket purchasing problem originated from its large population. And this website now also has its corresponding APP.

Summary

To sum up, social media, represented by SINA Weibo, WeChat, etc. and e-commerce platforms led by Alibaba’ series of e-commerce platforms, are all over modern Chinese’ daily life. News about those media and platform are attracting attention from both home and abroad. With the popularity of smart phones, the major trend of Chinese social media and e-commerce is taking the form of APP. All the social media websites and B2C or C2C e-commerce websites mentioned above now have corresponding APPs. Over 40% of the 57 billion sales amount of Taobao and Tmall this year were done on APPs. Newly emerging social media and e-commerce platforms are almost all in the form of APP. The second trend is the cooperation between online platforms and between online platforms and offline companies. Take Alipay for example. It has to cooperate with all the big banks to provide solutions to e-commerce websites, and then it has to gain cooperation with as many e-commerce websites and APPs, such as those taxi ordering APPs, as possible so that it can have lots of individual users. Another example would be those B2T websites. By cooperating with offline restaurants, cinemas, KTVs, etc., they provide users with cheaper products and services, and gain profit by getting commission fees from those companies. And those restaurants, cinemas, KTVs, etc. can get large number of customers, some of which may become their regular customers. It’s a win-win-win solution. Another trend is that social media, including Renren, WeChat, QQ, and SINA Weibo, seem to try to combine their function as social media with e-commerce services. For now, as newcomers, they cannot compete with those e-commerce platforms, but users may like the idea of connecting to people, buying staff online and paying for online and offline purchasing all in one APP. 

ABOUT THE AUTHOR

Thanhtu
Dao

Focusing on SEO since 2012, Tu has a rich experience in online marketing she employs for the great benefit of Seirim's clients. Adding to that role she now also assists with Project Management and leads Website Quality Testing, including User Experience and Performance testing.

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