Analysis of the marketing and promotion model of UnionPay QuickPass!

In the past two years, the eye-catching red advertisements of "Look at UnionPay first for payment" have begun to frequently enter the public eye: subways, supermarkets, elevators, bus stops... It seems that overnight, even if you have never used UnionPay, you have heard of its legend: 1 cent for bus rides, random discounts on subway rides, inviting friends to "download UnionPay and receive an 8 yuan red envelope immediately", etc.

So, who is UnionPay QuickPass?

Cloud QuickPass was born with a golden key

On December 11, 2017, China UnionPay, together with commercial banks, payment institutions and others, launched the unified banking APP “Cloud QuickPass”.

In terms of functions, the new "QuickPass" takes payment tools as the core and strives to create various payment scenarios and special banking services. Competing with Alipay and WeChat Pay, it is commonly known as the "official payment app."

Shouldering the heavy responsibility of regaining the payment entrance for the banking industry

Fan Yifei, deputy governor of the People's Bank of China, said in his speech at the Cloud QuickPass launch conference: "Payment is a need of people's livelihood and the foundation of finance. In recent years, my country's payment market has developed rapidly, playing an important role in promoting financial innovation and sustained and rapid economic development."

Since 2013, my country's mobile payment has developed rapidly, with its scale increasing more than 20 times. Alipay and Tenpay, two Internet giants, occupy 90% of China's mobile payment market. UnionPay, which missed the development period of mobile payment, hopes to make a comeback through Cloud QuickPass.

As the "hope of the whole village", UnionPay QuickPass is positioned as a unified APP for the banking industry, aggregating the mobile payment functions and benefits of various institutions, and is committed to becoming a mobile payment manager that saves consumers money and worry.

It is difficult to do C-end mobile payment, but another reason why it has to be done is: the emergence of China UnionPay.

In early 2017, with the support of the Central Bank, the China National Payment System (CNPS) platform, known as the "online version of UnionPay", was officially launched. In short, someone is here to steal our business.

From now on, all online payment transactions involving bank accounts handled by third-party payment companies such as Alipay and Tenpay must be handled through the "Net Union Payment Platform". According to Caixin.com: Currently, the online market share ratio of UnionPay and China National Net Union in the field of transfer and clearing is about 2:8, that is, among transactions where consumers choose WeChat QR code payment, eight out of ten transactions may be pushed to China National Net Union for transfer.

Huge subsidies and rapid progress in customer acquisition

As of September 10, 2019, UnionPay QuickPass officially announced that it has over 200 million registered users. In less than two years, it became the third player in the mobile payment field.

According to Caixin.com, UnionPay aims to have 250 million registered users and 40 million active users in 2019. With the current growth rate of 10 million registered users per month and the end of the year being the peak marketing season, it is not impossible to achieve small goals.

Such an impressive growth rate is based on huge marketing expenses.

According to Caixin.com: The marketing expenses of Cloud QuickPass in 2018 may be over 10 billion yuan. UnionPay has 35 branches. Those branches whose marketing expenses did not exceed 100 million yuan in 2018 were criticized by name. The marketing expenses in 2019 should be conservatively estimated to be around 8 billion yuan.

Yunsuanfu has become a paradise for those who want to get free stuff.

Fancy red envelope activities

The core services of the Cloud QuickPass App are: payment, bank card management, and daily life payment. All scenarios correspond to a large number of red envelope activities.

In order to activate users and cultivate their usage habits, red envelopes can be received in almost all scenarios where Cloud QuickPass is used:

• Scan the QR code to pay for daily consumption and get a red envelope with discount;
• You can get random red envelopes for transfers, credit card repayments, mobile phone top-ups, card binding, daily bill payments, etc.
• Random discounts on bus and subway rides;
• Sign in and draw prizes;
• New user registration red envelope;
• Red envelopes for old users to invite;
• …

In addition to learning from Internet companies to burn money on subsidies, UnionPay has also created a number of consumption days: 62 Festival, Supermarket Festival, Vegetable Market Fresh Festival, and UnionPay Mobile QuickPass Week, aiming to create a user consumption day brand to compete with "Double 11" and "618".

Online and offline marketing promotion activities

In addition to launching various promotional activities on its products, UnionPay QuickPass is also vigorously expanding its territory and channels in online and offline marketing advertisements. Even my mother, who had just learned how to use WeChat to buy things, was persuaded by the lady at the bank to use UnionPay QuickPass to take the bus, because it only costs 1 cent.

UnionPay, which has always been "low-key", changed its previous style after launching Cloud QuickPass and made its presence felt in the Internet marketing circle.

During last year's Double 12, when the number of registered users exceeded 100 million, UnionPay invited the popular singer Mao Buyi as a subsidy ambassador, shouting the slogan "One cent is not easy, UnionPay will pay half for you." For the 2019 "62 Festival", Ni Dahong, the actor who played Su Daqiang in the hit drama "All Is Well", was invited to be the spokesperson.

UnionPay QuickPass seems to be getting more and more down-to-earth: playing with memes, filming TikTok videos, viral H5s, magical ads... Behind these ads that "please" young people, it seems that QuickPass is trying to replicate the more down-to-earth marketing methods of the Internet era.

In addition, Cloud QuickPass cooperates with commercial banks and adopts a ground-based marketing approach, which is more effective among the lower-income population and the middle-aged and elderly population.

User development activities

No matter how many online promotional activities and advertisements there are, we are still in a passive position. If you want more users to actively download and use your product, you must adopt a more proactive promotion method.

Another weapon in the Cloud QuickPass user growth map is: user development activities.

UnionPay's user development activities refer to: inviting new users to register and use UnionPay to pay, and you can get corresponding commissions. The execution objects are mainly divided into: old users of UnionPay QuickPass and agents.

• Old UnionPay users: Invite your friends and family to download and register UnionPay through the red envelope promotion, and receive corresponding red envelope rewards. The maximum cost is no more than RMB 17 per person. If there are more than 10 people, it is fixed at RMB 14 per person.

• Agents: After all, the social circle resources of ordinary C-end users are limited, so the focus of Cloud QuickPass’s user expansion is on agents. It is said that Cloud QuickPass outsources user development business to agents, and the promoters of the agents develop subordinates through the distribution model...with layers of grading and profit sharing, and settlement is done by a unified background. This piece-rate method can maximize the promoter's initiative and bring about rapid growth in users.

Users are the foundation of everything. Under the bombardment of numerous subsidy activities, the number of Cloud QuickPass users has grown rapidly.

Covering high-frequency consumption scenarios is the key to retaining customers

As the top wool-gathering users are cleaned out, the cost of a single new user becomes increasingly high, and the subsidy strategy is unsustainable.

How to convert freeloaders into active users is currently an urgent problem that Cloud QuickPass needs to solve.

According to the monthly active data of Cloud QuickPass APP provided by iResearch Qianfan, the maximum number of active users of Cloud QuickPass APP in two years was nearly 22 million. Compared with the hundreds of millions of monthly active users of Alipay and WeChat Pay, there is still a long way to go.

Xue Hongyan from Suning Financial Research Institute commented: UnionPay QuickPass is positioned as a national app to meet the long-tail needs of users, so it is destined to follow the path of Alipay and WeChat Pay and continue to expand into new scenarios. Payment methods at the entry level are homogenized, and if you want to retain users, you can only rely on scenarios and ecosystems.

In terms of scene coverage, Cloud QuickPass is vigorously expanding its territory.

In November 2019, UnionPay QuickPass released a new version 7.0.0. Compared with the 6.0.0 series versions, the tool-like feel of the homepage has been weakened, and it focuses more on highlighting the usage scenarios, which is somewhat similar to the Alipay homepage.

The war of mobile payments is essentially a fight for consumption scenarios, and the high-frequency and rigid-demand consumption scenarios of “food, drink, housing and transportation” are the must-fight areas. Since its launch, Cloud QuickPass has been actively deploying mobile payment convenience demonstration projects covering the "top ten convenient payment scenarios": public transportation and subways, vegetable markets, medical care, convenience stores, public payments, self-service vending machines, campuses, canteens, traffic fines and confiscations, and catering.

In the field of transportation, it has covered 29 city subways including Shenzhen, Shanghai, and Chengdu, and more than 1,000 city and county buses across the country; and has realized contactless payment in more than 10,000 parking lots in more than 240 cities across the country.

Another important mobile payment convenience project of Cloud QuickPass is: campus mobile payment scenario.

Nationwide, nearly 1,600 university campuses and 17,000 merchants of different types have put UnionPay QuickPass into use, and teachers and students from over 300 universities use the UnionPay QuickPass APP for online recharge and payment. Focusing on the life and consumption needs of university teachers and students, with canteens and campus supermarkets as the main application scenarios, it provides a variety of services such as offline payment, identity recognition, and access control management.

Just as my cousin who is just a freshman in college said, "For the same dish, Alipay costs 3 yuan, but UnionPay may only cost 1 yuan. Which one should I use?" UnionPay has been implemented in their school for nearly a year, and canteen meals can be randomly discounted. Perhaps, one day in the future, those born after 2000 will use QQ for socializing and UnionPay for payment, while WeChat and Alipay will only be used by middle-aged and elderly people.

But, for now…

At present, apart from subsidies, there seems to be no reason to use Cloud Quick Pass. Alipay has Taobao and WeChat Pay has WeChat, so using them for payment is a natural thing to do.

Final Thoughts

Compared with Alipay and WeChat Pay, UnionPay QuickPass not only has the advantage of fund security, but also has its own characteristics at the product level:

• Powerful one-stop management of inter-bank bank cards: UnionPay QuickPass can bind up to 15 UnionPay cards, and can directly implement services such as online card application, mobile payment, expense accounting, balance inquiry and credit card bill inquiry in the UnionPay App.
• 0 handling fee for transfer and credit card repayment: transfers are received within seconds, bills are checked in real time, and there is 0 handling fee. This is undoubtedly a great convenience for credit card users, and it is also an important reason why I currently use UnionPay QuickPass.
• Instant payment NFC QuickPass: NFC payment supports quick payment when the mobile phone is close to the POS machine.

Such product features may make UnionPay QuickPass a useful niche app, but it is still far from the goal of becoming a “universal app”.

In recent days, I have found through offline experience in Shenzhen that the payment code coverage scenarios of Cloud QuickPass are mainly concentrated in large and medium-sized supermarkets and brand chain stores, while it is almost unusable in street corner shops that are closely related to daily life. UnionPay QuickPass seems to be stuck in a cycle of “users cannot find merchants, and the user scale is not large enough to attract merchants.”

The reason why Alipay and WeChat Pay can occupy half of China's mobile payment market is the cooperation between online and offline C-end users and merchants: Looking back at the development history of mobile payment, in the subsidy activities of Alipay and WeChat Pay, users either out of curiosity or for the sake of subsidies actively joined the mobile payment army. On the other hand, the huge traffic of Alipay and WeChat makes it impossible for merchants to refuse. In order to better meet the needs of users, many merchants are forced to open payment codes.

The more users there are, the more merchants there are, and the more merchants there are, the more users there are; as a result, the mobile payment habits of merchants and C-end users are becoming deeper and more mature.

The pressure of acquiring and activating customers on the user side and the pressure of layout on the merchant side are two major challenges in building a payment ecosystem.

After carefully studying the dynamics of Cloud QuickPass in the past six months, it is still adopting the strategy of "laying the foundation with huge subsidies and gradually enriching the scenarios". Perhaps we don’t have to wait until Cloud QuickPass builds its own ecosystem. The central bank has unified the payment/collection codes and realized the interconnection and interoperability of QR codes. No matter whether you are using Alipay, WeChat Pay or Cloud QuickPass, merchants only need to put up a QR code.

Until then, it’s another story.

Author: Xiang Xiang

Source: Xiang Xiang