Alibaba’s launch of bargain marketplace Taobao Deals on Tencent’s super app WeChat hits a snag, source says
- Alibaba’s plan to launch Taobao Deals mini-program on WeChat makes little progress weeks after application
- The e-commerce collaboration would have enabled Taobao Deals to accept transactions that use online payment service WeChat Pay
Tencent, which runs the world’s largest video games business by revenue and China’s biggest social network, has suspended testing Taobao Deals on WeChat, as there is little substantial progress at the current stage, according to an Alibaba executive who declined to be named. Alibaba, which owns the South China Morning Post, had confirmed four weeks ago that it filed an application to Tencent to open a mini-program on WeChat.
Four weeks later, however, there is no sign or timetable from either side that the Taobao Deals mini-program will be available on WeChat.
Taobao Deals had created a mini-program, called Jianzhile, and introduced it on WeChat in early February. The service, however, was quickly removed for “mismatch of claimed category and content”.
Tencent and Alibaba did not reply to requests for comment.
With about 1.2 billion monthly active users as of December 31, the enormous reach of WeChat, operated as Weixin in mainland China, makes it valuable in the country’s vast e-commerce market. The gross merchandise value – a metric of e-commerce sales volume – generated by mini-programs on WeChat doubled in 2020 from 800 billion yuan (US$123 billion) in 2019, according to the social media giant.
Taobao Deals, an app whose popularity expanded in 2020, “may grow even faster if it can launch on WeChat”, said Michael Norris, research manager at Shanghai-based consultancy AgencyChina.
Tencent is the second-largest shareholder of Pinduoduo, with a 15.6 per cent equity stake as of March 31. The Shenzhen-based company has helped boost Pinduoduo’s rapid growth by enabling the app to share links on its WeChat platform.
Tencent could initially allow Alibaba’s second-hand product marketplace Xianyu to launch a mini-program on WeChat, according to Norris, since that service is not a direct threat to Pinduoduo. Alibaba applied to launch Xianyu, which means “idle fish” in Chinese, on WeChat last month, but the service was not approved by Tencent.
At present, WeChat can block a mini-program on the grounds that it violates community rules, which cover “external links that entice users to share”. Those include links to sites run by competitors including Alibaba and ByteDance.