Messaging Apps Become Transactional in China

Messaging Apps Become Transactional in China

WeChat, an instant messaging service owned by Chinese Internet service provider Tencent, has emerged as a viable sales channel for travel companies, reveals the WTM Global Trends Report 2014, in association with Euromonitor International, released today (Monday 3 November) at World Travel Market.

With 440 million active users in Q2 2014, WeChat is the second largest global messaging service after WhatsApp, which has 500 million active users. WhatsApp was bought by Facebook earlier this year for more than £13 billion in cash and shares, one of the biggest technology deals in corporate history.

However, WeChat is more advanced in terms of monetising its popularity, the report suggests. WeChat is expected to generate revenues of US$1.1 billion in 2014 and grow by 40% in 2015.

Its revenues come mostly from online games, but it is currently focusing on increasing its revenues from mobile commerce and payments. Surveys suggest that it is the most popular platform in China for the sharing of travel experiences.

WeChat and LINE – a Japanese-based service which is gaining traction in China – now allow companies to manage customer support through their apps, which is especially interesting for travel where timely responses to customer issues are key.

A number of travel businesses are taking advantage of this. Leading Chinese online travel agency Ctrip sells air, rail and attractions tickets through WeChat; Chinese taxi app Didi Dache doubled its users to 40 million in one month after starting a partnership with WeChat; low-cost carrier Spring Airlines launched a WeChat service in April 2014 allowing users to book flights and check in using the tool.

The WTM Global Trends Report 2014 predicts that “WeChat is expected to be launched on all internet-connected mobile devices including smartwatches and smartglasses.”

World Travel Market, Senior Director, Simon Press said: “Instant messaging platforms have emerged from nowhere to become an important sales channel in one of the world’s fastest growing travel markets, and there is still more growth to come.

“And as accessing the internet from a smartphone becomes common-place, instant messaging as a transactional channel could take off in mature markets as well.”

Euromonitor International, Head of Travel and Tourism, Caroline Bremner added: “Given the fast-growing role of messaging services worldwide, travel companies are expected to embrace them for customer service, bookings and payments as they did with social media.”

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