Last Sunday was the Chinese New Year, and it brought in the Year of the Monkey. All Chinese in the world were celebrating the Spring Festival last weekend. Therefore, much news related to the Chinese New Year this week mentioned the traditions, for example people reunion with their families and attended the cultural activities, such as setting off firecrackers, ancestor worship, dragon dances and etc. Surprisingly, lots of business news websites published news about digital “red envelopes” on WeChat this week. According to statistics, there are over 8 billion “red envelopes” in total sent over WeChat during Chinese New Year.
WeChat is a popular Chinese social media mobile application that not only allows people to send text or voice messages, but also allows people to post pictures and share interesting articles at their Moment page. The recent life report showed that WeChat has around 650 million monthly active users, which cover more than 200 countries and more than 20 languages. People spend 280 million minutes (about 540 years) on Wechat video and voice calls everyday. Young users have on average 128 friends on their WeChat. Basically, Wechat can be one of the most successful applications in the world.
In January 2014, WeChat launched a new function – “red envelope” that allows users to gift random amounts of money to one another in their contact lists. The scheme was a campaign to lure users on to its mobile payment system, WeChat Payments. Based on its huge number of active users, we should not be surprised that the campaign reached wildly success, which it leaded 200 millions of smartphone owners to attach their bankcards to the app by November 2015. People now can purchase rides, meals, and other goods on WeChat.
Although many people think the success of WeChat payment is inevitable, its amazing growth rate still shocks people. Two years after the first red envelopes scheme, WeChat Payments got 200 million users. That is about two-thirds of the biggest mobile payment services provider in China Alipay’s user count. All these things happened only in 22 months. In my opinion, I think the success of WeChat payment is because WeChat is a social media application. Unlike WeChat’s, Alipay’s parent company is E-commerce giant Alibaba. Therefore, most of people in your contact list are the people you know, such as family members and friends. In past, millions of red envelopes stuffed with cash are expected to change hands among families, friends and colleagues, when China celebrates the Lunar New Year. But now, there’s a new spin on this old tradition, with the gift-giving happening right on people’s smartphones. WeChat payment also makes convenience for you to split the bill when you hang out with friends and want to separate the check, because the restaurants and merchants in China don’t do separate payments during checkout. In addition, WeChat still has huge potential now, because WeChat’s users likely open the app every day, while Alibaba’s users don’t. To be more accurate, 25% WeChat’s users open the app more than 30 times everyday and 55.2% users open it more than 10 times.