Retail in Asia

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Alibaba to launch Taobao Deals on WeChat

WeChat x Alibaba

There are no permanent enemies, only interests.

After years of increasingly fierce competition, the two Chinese internet giants Alibaba Group Holding and Tencent Holdings have stood on the same front.

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According to many media sources, Alibaba is planning to set up a Taobao Deals lite app on Tencent Holdings Ltd.’s WeChat messaging platform, as well as accepting payments made through WeChat Pay. This means that users of Taobao Deals will be able to pay via WeChat Pay and receive payment among friends.

Taobao Deals is a C2M bargain platform launched by Taobao Company. It was launched in March 2020, and the number of annual active buyers exceeded 100 million in November 2020.

As of now, the officials of Taobao Deals have not yet responded. The Taobao Deals customer service said that the Taobao Deals WeChat Mini Program has been tried internally, but it is not yet open to public. It is also pointed out that the mini program is being tested and will be launched once it has been improved.

Alibaba and Tencent have always excluded each other’s services from their platforms. So far, Taobao products can only be shared on WeChat by copy-pasting a Taobao message, and cannot be redirected directly. Consumers also cannot use WeChat Pay when shopping on Taobao.

In order to further compete with Alibaba, Tencent has also partnered with another Chinese e-commerce giant, and opened a shopping section for JD on WeChat. WeChat users can directly jump to JD’s purchase platform Jingxi and JD shopping page.

Alibaba and Tencent are even more competitive in the field of payment. At the beginning of mobile payment, Alipay and WeChat both launched a series of payment discount activities to seize market share and attract users, such as Alipay’s rewards and WeChat Pay’s shake function.

However, from the perspective of industry experts, this collaboration between Alibaba and Tencent is not a surprise as both parties are facing the challenge of slow traffic growth.

It is worth to note that China’s other e-commerce platform Pinduoduo released a better-than-expected fourth-quarter performance report, with annual active buyers reaching 788.4 million, surpassing Alibaba for the first time. According to data provided by QuestMobile, during this year’s Spring Festival, the number of daily active users on Pinduoduo was 259 million, surpassing Taobao mobile’s users of  237 million for the first time in history.

Obviously, in the face of the continuous dominance of latecomers such as Pinduoduo, Douyin and Kuaishou, Alibaba and Tencent can only put aside their prejudices.

At least for now, as the WeChat ecosystem matures, Taobao Deals mini program launching on WeChat and Taobao Deals opening to WeChat Pay have no business loss for both parties.

According to WeChat official data, the number of WeChat monthly active users has exceeded 1.2 billion. In the past year, the number of daily active users of WeChat mini programs exceeded 400 million. The number of mini programs used per capita increased by 25% compared with 2019, and the amount of mini program transactions per capita increased 67 compared with 2019. %.

In terms of commercialization, in 2020, the GMV of mini programs increased by more than 100% year-on-year, of which physical commodity transactions increased by 154% year-on-year, and merchant self-operated GMV increased by 255% year-on-year. In the past year, more than 100 million users made purchases through mini programs such as department stores.

SEE ALSO : What is Kuaishou?

After the news, Alibaba’s stock price rose nearly 2% on 17th March, and its current market value is around US$627.1 billion. Pinduoduo’s stock price plummeted by nearly 10%, and its market value is around US$177.4 billion.