The Chinese tech industry is booming and one company is dominating. Tencent now holds a massive market share and even briefly passed Facebook as the world’s fifth most valuable company, with a US$529.9 billion valuation last month.
The ecosystem the company’s WeChat app has developed means there’s potential for even more growth, according to AtlasTrend Co-Founder Kevin Hua.
“Tencent is now the largest internet company in China. It’s got a user base of over 800 million users,” Hua told Which-50.
The users come primarily from Tencent’s WeChat app. Originally a simple messaging app, WeChat has now evolved into a near fully fledged digital ecosystem, Hua said.
“The important thing about WeChat is it’s really now become the largest ecosystem in China on the internet.”
In addition to messaging other users, ‘Wechatters’ can shop and make payments online and in store, share bikes, hail taxis, share locations, and even trade bitcoin. Essentially, users can use WeChat and only WeChat all day. In that regard, Tencent delivers a more complete product than US heavyweights like Facebook, Hua said.
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While the WeChat juggernaut rolls on there are several other Chinese ecommerce companies growing quickly. Hua identified three to keep an eye on.
With 300 million users, Baidu is China’s largest search engine and akin to Google, Hua said. “Like Google/Alphabet, it provides a whole range of internet-related services based around search.”
Trailing only the giant that is Alibaba, JD.com is China’s second largest ecommerce company, Hua said. “More than a marketplace” JD also carries its own products and importantly has strategic partnerships with giants Tencent and Walmart, Hua explained.
When the Chinese go on holiday, there’s a good chance they will use Ctrip to book at least some part of it.
“Ctrip is China’s largest online travel agency. Think about it as an Expedia or Priceline.com for the Chinese market,” Hua said.
The company has a 60 per cent market share and acquisitions outside China shows it is intent on growing its offshore business as well, according to Hua.
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