GUEST POST-WeChat Story Part 3: Self-Made Media Machine
The following is Part 3 in a multi-part series about the rise of WeChat, the popular mobile instant messaging service owned by Tencent.
By Lanie Nie
While many popular WeChat subscription accounts are still affiliated with established organizations, the social media upstart has also given rise to a new generation of “self-media”. This new group of publishers comes as a welcome development in the Chinese media space, comprising independent professionals from sectors like tech, finance, fashion, media and education who have seized the opportunity to broadcast their know-how and build online audience networks of their own.
Without some expert “gatekeepers” from traditional hierarchical publication systems standing in their way, this new group of voices on WeChat have become a celebration of grass-root content creators. Articles from these new publishers can be easily found online, and members of this group are gaining personal influence among readers, listeners and viewers on WeChat who want to hear their latest views.
This new platform has also created new business opportunities for content creators. In February Tencent kick started an advertising trial on selected subscription accounts by adding promotional content at the bottom of articles that is sent out to followers once per day, providing an add-on option to help account owners make money off traffic they generate. When popularity of a subscription account reaches critical mass, things can get even more lucrative for the account creator.
One good case in point is “Logic Show”, a subscription account (WeChat ID: luojisw) run by the creative Luo Zhenyu, a veteran CCTV producer, and co-founder Shen Yin, an ex-print media worker, who is in charge of operation and marketing. The account has attracted 1.6 million followers since its launch on December 21, 2012, building a brand name for the niche community that is a forum for knowledge sharing.
By sending out a 60-second voice message to WeChat followers at 6:30 every morning and starring in a weekly one-hour talk show broadcast every Friday on Youku (NYSE: YOKU) China’s biggest online video-sharing platform, Luo successfully established himself as “the man who reads in the service of other people”.
Value-Added Service Bonanza
What makes “Logic Show” more impressive is that it has sold 9.6 million yuan or about $1.53 million worth of memberships in just two rounds of member recruitment. It has done that by promising each member one free book per month hand-picked by Luo, and privileges of attending offline fan meetings. Notably, the newly launched WeChat Payment has become the only payment solution for the second round of recruitment, helping the club add 20,000 new members and collect 8 million yuan of membership fees.
It is quite well known that people in China don’t like to pay for things they find through web searches for things like news, books, music and movies, which leads to a weak concept of intellectual property right protection. However, Chinese people make up for their thrift by spending on valued-added services like memberships in the case of “Logic Show”. Other examples that attract their online spending include gift-sending gimmicks from online performance platforms such as the one operated by Nasdaq-listed YY (Nasdaq: YY), and a writers-tipping trick invented by the online literature arm of Shanda Interactive Entertainment.
Nobody understands this quirk of the Chinese Internet market and its implications more than Tencent, as the Hong Kong-listed company generated a whopping 78 percent of revenues from such services, according to its most recent financials. That contrasts sharply with many of its peers, which depend far more heavily on online advertising, similar to many western counterparts. Revenue from Tencent’s “Q coins,” an online currency that can be used on its popular QQ messaging platform to pay for VIP packages, weapon kits for games and fancy costumes for avatars, usually locks at around 25 to 28 billion yuan ($4.1-$4.6 billion) each year.
Lanie Nie is a writer, translator and participant observer of localization and internationalization efforts by Chinese technology, media and entertainment companies. She freelances regularly for Chinese business and technology news websites and can be emailed directly at lanienie@hotmail.com.
