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Understanding WeChat Customer Lifetime Value

In a country which leads the world now in every mobile usage and application metric, WeChat has emerged as the default business platform connecting commerce in the online environment with that of the physical offline world, often referred to as O2O.

Known for its ‘apps within an app’ model, WeChat has been cleverly built out by Tencent as a highly accessible open platform with a minimalist design footprint and supported by a universally extendable ecosystem.

Yet, beneath it all WeChat remains a stripped back social messaging app with a ‘swiss army knife’ approach. There is a super-set of 360 degree functionality integrated seamlessly to that central ‘knife cutting’ chat communications point-function.

These WeChat hybrid features make it the core digital tool for a firm to engage and move the customer forward from where awareness/interest is achieved (e.g. Weibo), on down through every stage of the acquisition funnel, and beyond*.

Hence making WeChat essential in maximising customer lifetime value through its integration in both your eCommerce channel strategy and across many of your social CRM digital touchpoints.

(*More on this when we talk about WeChat Customer Engagement).

A device-independent business OS

WeChat’s universality as a micro-channel by which people in Asia discover, evaluate, select and interact with brands, products and services sets it apart.

Indirect as well as direct customer-supplier relationships are supported by its design, with third parties or intermediaries interacting along WeChat transactional and relational value chains in all vertical sectors and product categories.

The unrivalled success of WeChat is deeply rooted in its cunningly retro-simplified user interface (UI) and intuitive user experience (UX), removing any friction in social messaging, sharing or transactional commerce across one-to-one, group or extended communities.

WeChat uses technology in a highly immersive, almost stealth-like, way. For example, it stitches the off- and online worlds together via the ubiquitous QR code and, the recently launched, Mini-Program inserts function-specific ‘light apps’ technology into every social sharing and interactive user scenario imaginable while removing the need to install native apps.

Significantly, Asia software experts point to the fact that WeChat is quickly becoming a device-independent business OS (operating system).

This shows how the messaging platform is emerging as an agnostic network, divorcing it from any mobile software standards controlled by iOS and Android.

[Note: this is akin to how Windows 3.0 became the de facto OS for the PC age, leveraging the user relationship because it sat above the root IBM DOS architecture].

Key Differentiators of WeChat

  • The Official Account (OA) model is a Platform as a Service (PaaS) for brands and organisations to acquire & engage customers and to deploy & offer software app services and ongoing support to these customers.
  • Authentication is provided as a secure protocol where every ID is linked directly to the mobile phone number of a certified user (Chinese government regulations prevent anyone from having a mobile number without being registered officially).
  • Content editorial, digital article publishing and push notifications and alerts, combined with contextual search services for social discovery across published and posted content in articles, user-generated content (UGC), newsfeeds and groups, and service providers and brands’ OAs.
  • WeChat Moments personal user newsfeeds with social sharing, likes, comments and repost functionality.
  • Open API business model and 3rd party software development and integration standards.
  • Online-Offline (O2O) integration of services and technology via QR codes and ‘lite app’ Mini-Programs.
  • Third party embedded services including government support services, utility accounts access and payment, community welfare, health and public services provision.

Messaging replaces Email, enhances CRM

In 2016 research from Tencent, 80% of users completed work-related tasks on WeChat, and 60% reported their new WeChat contacts are mostly work-related.

Email has been broadly replaced by mobile messaging in Asia, something we are now only seeing as a nascent trend in the West.

As the go-to app, WeChat is where both one-to-one and group messaging has become the primary channel for work communications in Asia. Moreover, the messaging platform’s architecture is designed to optimise CRM functionality.

Features that make WeChat a digital CRM asset include ID verification, pre- and post-sales service and support response features, customer analytics, loyalty and rewards programming tools, interactive content publishing and newsfeeds, and both O2O and QR customer services.

What brands should be thinking about on the WeChat platform

Scaling through others. Brands should limit their focus on WeChat as a content publishing platform and instead prioritize one-to-one and group engagement, additionally leveraging KOLs to extend the reach and engagement of campaigns.

All-in-one. Brands should not think of WeChat as either siloed or strictly social platform but as a central hub for implementing cross-platform customer journey strategies in loyalty, commerce, online-to-offline (O2O) and service.

Evolution. As WeChat continues to influence the customer engagement relationship while its platform capabilities expand, for example with mini-apps such as Starbucks social gifting, brands should innovate and test its potential.

Account Based Marketing to hack the Customer Funnel

WeChat hybrid features make it the core digital tool for a firm to engage and move a B2B or B2C target audience forward, down through and beyond the traditional customer acquisition funnel.

As described elsewhere, this makes it essential in maximising customer lifetime value by its integration in both your WeChat eCommerce channel and all your social CRM platforms and channels.

Regardless, your brand or firm is probably already engaged in customer sales and marketing ‘conversations’ and ‘experiences’ in the WeChat OA (Official Account) structure. This activity may be currently managed within your social media programmes or possibly allocated to customer service & support.

If your brand or firm is interacting with B2B leads on WeChat then you are in the territory of ABM (Account Based Marketing). This is an emerging model #flipmyfunnel which is seeing hacks to the traditional sales funnel and flipped to achieve better B2B customer engagement outcomes.

WeChat Customer Engagement Opportunities

  1. CRM (Customer Relationship Management) - A robust and well managed CRM system is a must for B2B companies. This also applies to any brand or product/service that has a longer sales cycle, incremental value or extended purchasing decision e.g. cars, white goods, or financial products. WeChat maintains interaction and nurtures leads in a frictionless and convenient manner. However, these conversations can usually take place on a salesperson’s personal account and not on the brand’s official account. Often, this is a partial or total loss for customer intelligence, analytics and reporting.
  2. Customer Service - Pre and after-sales customer service are the major reasons why customers engage with members of your sales team. While it is convenient for sales to answer customer questions via personal WeChat accounts, the brand loses a valuable opportunity to document and archive meaningful customer feedback that can ultimately improve the products and services in the long run.
  3. Brand Messaging and Values - B2B businesses often struggle with brand dilution and inconsistency as key corporate and product messaging, communications and content gets mostly disseminated through salespeople. While it is easy for brand marketing to manage the content and campaigns on official accounts, it is much more challenging to do this with communications dispersed across an array of personal accounts.

Essential WeChat B2B Platform Marketing Features

  • Team & Content Management: Create on-brand content, identify acquisition channels, and admin user-level access of the official brand account for the entire sales team.
  • Mobile Sales Interface: Add customers using the brand’s official account without any added friction. Access to on-brand content and campaigns.
  • Direct Chat: Engage in direct chats with leads and customers under the brand’s public WeChat account for every frontline sales, marketing and service representative.
  • Social CRM: Organize and save all useful customer information. Automatically archive collected data fields into the appropriate social CRM or exported CRM system.