How are luxury brands refining their WeChat advertising strategies?

This article was originally written by Ruonan Zheng for Jing Daily

Tencent aggressively pushed advertising options on luxury brands on WeChat in 2018 – nearly 90 per cent of companies placing ads on WeChat last year marked their business as “luxury”, a trend that is likely to continue in 2019.

As luxury brands update their WeChat strategies, how can they ensure their advertising budgets are used effectively? We spoke to several experts to find out.

A dedicated strategy just for WeChat mini-programs

WeChat’s mini-programs have seen astonishing growth since their January 2017 launch. A total of 580,000 mini-programs – involving 1 million developers, linked to 2,300 third-party platforms, and engaging with over 170 million daily active users – were on the app in January 2018.

Last year we saw luxury brands adopting mini-programs as standard practice, for e-commerce, membership programs, event management or clients. But brands need to build a long-term strategy.

“Brands often forget e-commerce sales are mostly based on the traffic you can generate, which is hardly free,” said Alexis Bonhomme, Curiosity China founder and Farfetch Greater China vice-president of commercial. “Brands start to realise mini-programs can be amazing recruitment, and they are enlarging the usage of the mini-program format to all kinds of purposes: it starts with e-commerce (which was the most logical one) to membership and loyalty.”

As for the e-commerce function, brands will look beyond follower acquisition to “sales conversion” with a clear return on investment, predicted Bonhomme. He added, “In the same way the KOL (key opinion leader) industry is evolving to a transactional model, we see the emergence of WeChat as a social commerce platform, leveraging followers’ networks/sharing functions, driving to sales conversion.”

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