Luxury brands are now connecting and selling to millions of customers through WeChat Mini-Program E-Shop

With an ecosystem of platforms that includes China’s largest messaging app WeChat, Tencent is attracting official partnerships with the world’s top luxury brands. Louis Vuitton, Cartier, Bulgari and other luxury brands are now connecting and selling to millions of customers through WeChat Mini-Program E-Shop.

Luxury brands have been increasingly turning to Tencent’s WeChat platform fore-commerce. Gartner L2’s Digital IQ Index: Luxury China report found that 60% of Index luxury fashion brands and 51% of watch and jewelry brands had WeChat stores as of April 2019, a number that increased dramatically since 2018 with the rise of WeChat’s Mini Program feature. Tencent’s competitor Alibaba has been catching up this year in the luxury space, with 51% T-mall flagship adoption among Index fashion brands as of September.

Why WeChat E-commerce can attract so many luxury brands?

Like Facebook, WeChat allows businesses to set up their online shops. The Chinese app now boasts more than 1 billion monthly users, but these people aren’t readily exploitable as customers. WeChat, unlike Alibaba,isn’t a marketplace and does not have a central search engine that indexes all the merchants selling over its platform.

A WeChat store is thus more comparable to a site store —it exists in the online universe but requires a lot of marketing before consumers stumble upon it. People may discover Wechat stores by scanning a QR code at a brick-and-mortar outlet, clicking on an ad embedded in an online article or through a slew of other creative ways that merchants devise.

Shoppers can, for instance, talk to shop assistants over WeChat or check their membership status with just a few taps on the screen. It’s the social prowess of WeChat that separates it from entrenched e-commerce candidates like Alibaba and JD.com,which focus more on transactions. In a way, WeChat is not directly taking on Alibaba but playing a complementary role by providing customer relationship management (CRM) capabilities.

A lot of these service-oriented features are powered by so-called“mini programs,” which are essentially stripped-down versions of native apps that run within a super app such as WeChat. As the Gartner L2 report points out, the rise in WeChat store adoption is linked to the increased use of mini programs by luxury brands.

A total of 69% the luxury brands in the sample group have at least one mini program. The adoption rate among fashion-focused luxury brands grew from 40% in 2018 to 70% in 2019, while the watch and jewelry category climbed from 36% to 62% over the same time period.

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