How did Zhang Xiaolong build the huge business empire of WeChat?

WeChat's business strategy has always been considered conservative by the outside world. Perhaps it is because the excellent product FoxMail has left too deep an impression on the public. Zhang Xiaolong has always been regarded as an excellent but down-and-out programmer. Some people also regard him as an out-of-date idealist because he puts user experience first and ignores business attitude. Even Zhou Hongyi cannot understand why Zhang Xiaolong created WeChat.

"Everything is based on user value." When all users on this land are gathered under your name, you will bear the joys and sorrows of all users. Of course, you also have the right to reap the benefits of all users. How to reap benefits? Everyone has their own way of reap benefits. Judging from the results, there is no doubt that WeChat has perfected the skill of reap benefits.

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Who makes money on WeChat?

On WeChat, micro-businesses make a lot of money, public accounts make a lot of money, and third-party platforms also make a lot of money. WeChat could have done all of these by itself, just like QQ did before, and achieved huge commercial value in a very short period of time, but it has never made any money. This may be the reason why the outside world believes that WeChat's business strategy is conservative.

As more and more users spend their time on WeChat, it has become a virtual country. If you were the one who created an Internet empire like WeChat, what would you do?

A variety of answers have emerged: pop-up ads on the startup page, open more ad spaces in the Moments, establish a membership system, sell various diamond memberships to users, sell 2,000-person groups, charge public accounts according to the number of fans, charge public accounts according to the number of readers...

However, no one can deny that WeChat has become a huge business empire. More and more people are starting businesses based on the WeChat ecosystem. Tencent has laid the foundation for its attack on Alibaba with WeChat Pay, and has the ability to connect everything with its open platform. As a result, Tencent's stock price has risen more than ten times.

WeChat is a lifestyle

If WeChat is a "country", in addition to competing for the number of users, WeChat also needs to compete for users' time. This is the same as the United States introducing talents, Europe needs young people to supplement its labor force, and major cities in China use various preferential policies to attract talents.

"WeChat is a lifestyle," and judging by the battery consumption on our phones, it has indeed done so.

Therefore, the best interpretation of “use it and leave” is not to let users leave your product as soon as possible, but to let you deal with the things at hand efficiently and free up time to do other things. WeChat is constantly creating more efficient and interesting scenarios for you to live on it, thereby keeping users’ time within the WeChat system, connecting online and offline, connecting everything and forming a closed loop of life.

Looking back at the creation of this business empire, it is quite interesting

In the process of transformation from PC Internet to mobile Internet, the way users use the Internet has undergone fundamental changes.

Smartphones allow people to access the Internet anytime and anywhere, and are more in line with human usage. This has greatly lowered the threshold for users and allowed more people to spend more time connected to the Internet. Smartphones have become the ultimate tool for connecting the real world and the virtual world beyond human organs. New content is generated at any time, and new content needs to be acquired at any time.

People are born lonely and have the need to communicate and express themselves. This is the user value that WeChat has grasped the most, and chatting and Moments are its concrete manifestations.

In the PC Internet era, apart from the most basic communication needs (Tencent social networking), people use the Internet more goal-oriented, which has formed a search-driven usage model, such as Baidu (information search) and Taobao (product search).

Goal-oriented search has become the most popular traffic monetization model, which can quickly form an interest analysis of users and provide precise advertising delivery. Baidu and Taobao are essentially both goal-oriented advertising monetization. Tencent, which is based on social networking, has the largest user relationship chain moat, but advertising in social scenarios will inevitably reduce user experience. Forming interest analysis based on social networking that can be used for precise advertising delivery is a relatively long process.

In the era of mobile Internet, as long as we are awake, smartphones allow us to access the Internet anytime and anywhere, which creates a large source of traffic that needs to kill time without a specific goal.

WeChat has the ability to gather all users into this virtual kingdom through the basic need of social interaction, but chatting is not enough to exhaust users' time on smartphones. For Internet companies, keeping users on their platforms to the greatest extent possible is the biggest moat.

Time is money

WeChat has greatly satisfied user needs (occupied user time) in several ways.

1. Group

The group meets the communication needs between acquaintances. Through WeChat groups, communities of less than 500 people are formed on WeChat, which has an impact on Internet companies that build communities.

2. Friends circle

Everyone has the need to express themselves and see the status of friends, especially among friends. Moments provide users with a space to express themselves. Smartphones reduce the cost of taking pictures. In the early days, the content of Moments was all life content generated by users themselves. At this time, Moments was the most vital and could best retain users' time.

3. Open Platform

Regarding open platforms, the public platform is more widely known to the outside world. In fact, the open platform covers the public platform (mainly content), connecting external apps, websites, hardware...

In a word, the open platform enables WeChat to connect everything, allowing users to spend all their time on WeChat.

WeChat, Weibo, and Toutiao compete for fragmented time

What can best satisfy users' "fragmented time" is fragmented content. Among the three main content presentation forms of video, audio, and text and pictures, video and audio are scarce due to their high production costs, while text and pictures have accumulated a lot of excellent content due to the development of PC Internet for many years. In addition, new hot spots provide a source of topics that can trigger social fission and dissemination. The public platform, which provides text and picture content for users to consume, instantly fills the fragmented time of users, enriches the sources of WeChat chat topics and Moments sharing, and quickly grabs the traffic dividend in the rapid popularization of smartphones.

At the same time, Weibo and Toutiao also keenly grasped this wave of dividends. The three have the same purpose: users no longer obtain content driven by goals, but instead passively push it.

Toutiao satisfies users by capturing content on the PC Internet through intelligent recommendations. In the early days of Weibo, it was mainly based on users creating their own life content and formed a certain user relationship chain. It gradually transformed into a fan base where content was mainly produced by celebrities and big Vs.

As of today, Toutiao is a centralized intelligent recommendation platform, Weibo is a combination of decentralized fan base and intelligent recommendation, and WeChat is still mainly decentralized.

The decentralized WeChat shares users and transfers traffic, which has ignited the concept of self-media. Many content entrepreneurs based on the WeChat ecosystem have embraced the WeChat public platform.

Compared with Toutiao and Weibo, WeChat has a large depth, which means that WeChat can give up more traffic (commercial value) and allow more people to meet the needs of WeChat users.

1. Tencent efficiently monetizes traffic through games.
2. Although Tenpay itself did not perform very well, it had connected with banks and established basic payment facilities, allowing WeChat Pay to quickly seize the initiative in mobile payments through red envelopes. Before Alipay could react, the Spring Festival Gala had crossed the Maginot Line that Alipay had spent ten years building.

Red envelopes, a social method that adds fun to life, not only strengthens the interaction between friends, but also provides a powerful tool for public account operators and micro-businesses to use for marketing and maintaining communities, satisfying the early application scenarios of WeChat Pay. The method in which individuals can receive payments offline through a QR code without providing a guaranteed transaction platform has allowed WeChat Pay to quickly open up the mobile payment market.

Tencent has games as a super traffic monetization channel, allowing WeChat to spend more energy and time on improving user experience. WeChat itself generates a large amount of traffic, which can not only meet its own needs, but can also be shared, dividing the big cake of WeChat with more people who participate in the construction of the WeChat ecosystem, thereby making the WeChat lifestyle richer.

For example, if advertisers spend 300 billion yuan on WeChat every year, Tencent can control the supply of advertising space to harvest 100 billion yuan of it, and give 200 billion yuan to public accounts, which will allow operators of public accounts to have profit margins on WeChat. The nature of public account users' attention provides a continuous guarantee for profit, which is why content entrepreneurship based on WeChat has become popular in the past few years.

Weibo originally took the lead, relying on the concept of fans' attention, and formed a certain relationship chain, breaking the long-standing pattern of Chinese user relationship chains being controlled by QQ, and creating the fan economy model through the star effect and the big V model. However, Weibo's own firepower was partly attracted by Tencent Weibo, and on the other hand, it needed to find a traffic monetization model, and gradually lost its rhythm. The traffic plate was not big enough, not only could it not attract more participants to share the cake, but it also had to find a way to recover the cake from the big Vs on Weibo.

If Taobao could realize the importance of Weibo, and realize that there would be great inconsistencies between the mobile Internet ecosystem and the PC Internet ecosystem (increasing a large number of untargeted traffic sources), and enter the market earlier, things might be different.

Although Toutiao attracts users through the efficient push method of intelligent recommendation, it cannot establish a user relationship chain by doing so; and the centralized intelligent recommendation traffic distribution model cannot give people enough confidence to continue to make profits from it. It only attracts those porters who do traffic business, but cannot attract investors to enter and form a large-scale entrepreneurial ecosystem.

If WeChat is the aircraft carrier of the mobile Internet, then from the very beginning it had the conditions of a basic frigate, and then became an integrated sea, land and air battle group.

We have to admire Ma Huateng's broad-mindedness. He put aside internal disputes and allowed Zhang Xiaolong to move forward rapidly according to his ideas.

Problems with WeChat

After years of development, WeChat, which is based on message push, has gradually become trapped by message push. Users can't stop and can't leave. It was originally used to kill fragmented time, but it has even broken their lives into pieces.

1. As the number of friends increases, work and life are mixed together, and users become more cautious in their comments on WeChat Moments. The proportion of life decreases, while the proportion of marketing increases, causing WeChat Moments to gradually lose its vitality.
2. Micro-businesses have established a complete marketing system on WeChat. The proliferation of small advertisements has reduced the user experience and made many communities established in a group form lose their vitality.
3. After years of moving from public accounts, a large amount of high-quality content on the PC Internet has been migrated to WeChat public accounts. During this process, some top public accounts have been formed, which have absorbed a large amount of traffic through a matrix approach.
4. It is difficult for individual original authors to obtain reasonable profits on WeChat. Articles chasing hot topics have led to homogenization of content. There is a lack of effective measures to combat plagiarism, which has dampened the enthusiasm of individual original authors. The quality of personalized content has gradually decreased, making public accounts less attractive to users as a whole.

…

Mini programs, search, look, and the rumored author system are WeChat’s various attempts to reconstruct the user experience and redistribute traffic benefits. The next article will try to write down some of my personal views.

For an analysis of the strategic position of mini programs in the WeChat system, please refer to: "The competition between WeChat mini programs and quick applications of nine major manufacturers including Huawei, Xiaomi, VIVO and others for the entrance."

The vision of some people can only be revealed when a great era comes, such as Steve Jobs who returned to Apple, Elon Musk who created Tesla and SpaceX, and Zhang Xiaolong in the mobile Internet era.

If this is a game of chess, the entire history of WeChat is sometimes a sudden success like Wu Qingyuan's, and sometimes a precise and accurate calculation like AlphaGo.

Everything I said was wrong.

This article comes from the WeChat public account: Cycling Tibet (gobybike), the author is Tao, former technical director of WeChat public platform.