China is a huge mobile market, nearly four times the size of North America. At the end of 2018, China had nearly 1.2 billion unique mobile subscribers representing 82 per cent of the country’s population. Over 97% of these come from mainland China, with the remainder spread across three other markets – Hong Kong, Macau and Taiwan.
It is clear that you must have a mobile presence to reach Chinese consumers.
The mobile ecosystem in China is dominated by Tencent’s two platforms, WeChat and QQ, which have daily active users (DAU) of 1.1 billion and 700 million respectively. Other big players include TikTok (Douyin in China) that had over 200 million DAU and over 400 million monthly active users (MAU) in China at the end of 2018. ByteDance’s other popular app Toutiao reached 120 million DAU by July 2018.
This expansion of mobile digital consumers has transformed China’s economy and society. It has also led to the idea of developing a ‘super-app’, a way to keep users in a single ecosystem very different to perceptions of online and mobile behaviour in the West.
The introduction of smart mini-programs
It is from the idea of a super-app that mini-programs were conceived in 2017. Mini-programs were initially created for WeChat as a simpler alternative to apps. They don’t need to be downloaded and are executed within the main WeChat app. Essentially, they are small applets that are generally smaller than 10MB meaning they can run directly inside the main app. It is this instant use facility that doesn’t take up much space on a smartphone that drives their appeal.
WeChat’s ambition was to encourage users to stay in their app, rather than switching back and forth among dozens of apps for different activities such as messaging, reading, shopping and playing games. Apart from WeChat, Tencent also runs and financially supports plenty of mobile services whether owned or not by the company, such as ticket booking, e-commerce, etc. Keeping users within WeChat means locking audiences into Tencent affiliated services, which is only for the benefit of Tencent ultimately.
Mobile search on Baidu
Despite the fact that Baidu missed the mobile boom, as of July 31, 2018, mobile revenue represented 77% of total net revenues at the company. Essentially, this all came from users’ mobile browsers, as opposed to using Baidu’s standalone mobile app.
By keeping users in their ecosystem, which is not browser-based, WeChat was taking search traffic away from Baidu as well as keeping content generated from WeChat public accounts in silos, thus preventing it from being indexed and accessed by Baidu users.
However, there are several reasons why WeChat public account articles are outperforming browser-based content, which are listed below:
- WeChat provides a very friendly ecosystem for building user-generated-content, which doesn’t require any technical knowledge to manage personal blogs, videos and pictures. This created a content boom on the platform
- People tend to make use of WeChat public accounts to develop a blog in China rather than establishing a blog or website on WordPress or Squarespace for example.
- WeChat has flourished because of the proliferation of social media use generally. This provided a fertile environment to grow key opinion leaders (KOLs) or social media influencers in niche markets, whose articles have a better chance of being shared and spread among huge audiences.
- WeChat was designed as an app for smartphones. Content on the platform is easily accessed and shared through mobile devices whereas the best user experience for Baidu was on web pages browsed through laptops and desktops.
- With the development of smart mini-programs WeChat was able to respond to almost any requirement from users, similar to standalone apps.
It’s clear that WeChat’s insular environment has taken traffic away from Baidu. However, to compete with WeChat’s almost total mobile domination in China Baidu’s strategic approach has been to encourage users to switch from browser to app, nurture social media influencers, and build their own smart mini-program ecosystem to challenge WeChat’s hegemony. These were launched in July 2018.
Baidu smart mini-programs
In December 2018, Baidu invested USD145 million to develop their own Smart Mini-Program Platform embedded in its search app, where external developers could create their own open-source Baidu mini-programs. Think of this the same as Google developing Android as an open-source competition to Apple’s iOS. Baidu wants to challenge the superiority of WeChat in China by creating a stable of innovative mini-programs that lock in traffic and prevent users from leaving their mobile app. In fact, Tencent copied Baidu in January 2019, by setting up their own USD145 million fund to support mini-program developers.
Though Baidu’s mini-programs share the same name with WeChat the developer environment is different meaning that the mini-programs developed on WeChat can’t be simply copy-and-paste into Baidu. However, for those who already have a WeChat mini-program, it only requires a few small technical tweaks to adapt a mini-program to Baidu’s developer environment.
All the major players in China, including Tencent, Baidu, Alipay and Toutiao, have all launched mini-programs to help merchants acquire users and improve the user experience. As of November 2018, Tencent mini-program DUA stands at 200 million, and as of January 2019, Alipay mini-program DAU stands at 170 million.
Since its launch in July 2018, Baidu mini-programs have been adopted by several brands including Xiaohongshu (Little Red Book) and Weibo. In fact, according to the China Internet Report 2019, Baidu mini-programs have been adopted by 200 million MAU as of May 2019.
How do users find Baidu mini-programs?
When a search is performed on a mobile browser with Baidu search engine, mini-programs are more likely listed at the top of the search engine results pages (SERPs). They are shown above most of the other web page-based organic search results.
For example, let’s take a look at Xiaohongshu by searching the brand keyword in Baidu. The top three search results are Baidu Brand Express SEM ad, Baidu general search ad, and then Baidu’s mini-program for Xiaohongshu, which is not a paid ad.
By clicking the third result, which is Baidu’s mini-program, you will be redirected to an intermediate page that encourages you to install Baidu’s standalone search app to get access to Xiaohongshu’s mini-program content, thus discouraging users from downloading the Xiaohongshu app. By installing Baidu’s search app a user is moved into Baidu’s app ecosystem and away from using a browser, all the while providing almost everything available within Xiaohongshu’s own standalone app.
Final thoughts on Baidu smart mini-programs
For any business wanting to enter the Chinese digital market, it is imperative to understand how different it is from other digital ecosystems around the world. The competition even within China is immense and there are plenty of examples of big firms that have failed to grasp this notion. However, there are just as many examples of small firms that have shown agility, adaptability and creativity to grow their business in China.
Understanding that in China you need to grasp the idea of a ‘super-app’ experience is fundamental to getting your China strategy right. Baidu mini-programs is a way to use digital in China seamlessly across a mobile and browser experience. If you already use Baidu for digital advertising and want to expand your mobile presence then Baidu mini-programs are a good way to get started.
Baidu’s ambition right now is to gain mobile traffic and start to eat into the share of their rivals who have pushed ahead. Baidu’s strength is its brand and the fact it still pulls in decent mobile revenue. The next stage is developing its mobile ecosystem and with Baidu mini-programs it seems this next stage is well underway.
Have you used Baidu mini-programs? What are your thoughts compared to WeChat mini-programs? We’d love to hear what you think. Please leave a comment in the section below.