Seeking to move away from merely selling ad space on its various platforms and become a business solution provider, Tencent has launched its new marketing offering 'WE+', which promises advertisers better integration within its ecosystem and more business intelligence.
Speaking at a launch event Tuesday at the company's Shenzhen 'vertical campus', Helen Luan, vice president of Tencent Online Media Group, said the launch has been preceded by the company’s active expansion into B2B solutions over the past two years through Tencent Cloud and WeChat's Mini Programmes. The company, she said, has achieved greater data consolidation by buying stakes in online and offline retailers such as JD.com, Vipshop and Walmart.
Meanwhile, sales forecasts, channel planning and price projections are among the business-intelligence solutions that Tencent says it can offer under the new marketing solution. "We have done that for big ticket items such as car brands,” said Luan. “This can inevitably help brands improve their ROI for ad spending. This is what we can offer through better data consolidation."
Tencent's WE+ marketing solution touts its offer to empower and engage with brands for better integration into its numerous platforms (left in above image) and functions (centre while it says the company's stake in a number of retailers (right) provides better consolidation of O2O data.
Sophia Ong, general manager of strategic partnership and key account service at Tencent Online Media Group, acknowledged that Tencent's data exists to some extent in siloes*, but said the openness of data depends on the platform and the brand's goal. She however assured that Tencent's vision for its new role would not leave agencies out of the equation.
"Unlike us, agencies are in a client-facing role," she said. "We also believe that agencies are equipped with the intelligence, and most importantly the creativity to help brands improve their business models. This cannot be achieved if we are just working with the brand alone."
Meanwhile, Ong said the biggest difference of WE+, compared to the company's previous approach, lies in a more strategic partnership with brands to close-in on the last-mile on the consumer journey, rather than providing one-off marketing solutions.
In addition to WeChat, Tencent’s vast ecosystem includes its payment system WeChat Pay, social networking, video, news, esports, gaming, literature, ecommerce. The Chinese online giant is expanding its intellectual property portfolio in online games, entertainment and sports while its tie-in with NBA draws viewers to watch the game on Tencent Sports, for example.
An example of how this helps brands is Tencent's deal with China Guangfa Bank to reduce customer acquisition costs for credit cards by 30% in a campaign that offers a free Tencent Sports membership to new card holders.
"It's not really necessary to use IP content, but there must always be a context for communication, be it through impressions or sociel ecommerce," said Ong.
Ong acknowledged that Tencent has always held up the potential of its entertainment ecosystem to marketers long before the launch of WE+. However, she emphasised that better integration into Tencent's network throughout a brand's different development stages will benefit the brand's business model and equity.
For example, she said brands undergoing Series A funding may only be looking for reach, hence social-media platforms could be the most appropriate. Their investors, however, might demand focusing on brand equity and scrutinising on the profit and loss during the later series of funding. That should be the time for advertisers to build stronger brand affinity through IP content
“If you are only looking for fast results, the long-term brand building effects will be affected. Our ongoing discussions with brands shows that finding an equilibrium is the common goal that we should be working towards," she said.
* As originally published this sentence made reference to Tencent as a "walled garden", due to a translation error. While "walled garden", in the sense that it's normally used, may be an accurate way to describe the company, it was not what Ong stated in the conversation.