Upstart Chinese apps use aggressive clickbait and free cash tactics to win over new users
- Discounts and coupons being employed by new generation of Chinese internet firms as they seek to establish themselves in a market dominated by bigger players
Cai Li, a janitor in Shanghai, developed a serious addiction to news app Qutoutiao, lured by gossipy articles about celebrities and the cash she gets from reading them.
Logging on during breaks at work and sometimes at night when she cannot sleep, the 63-year old has earned a few hundred yuan (US$30-US$40) over several months, which she says is useful to supplement her income.
With its unusual pay-your-user strategy, Tencent Holdings-backed Qutoutiao – pronounced “chew-tow-ti-ow” – has drawn in 20 million daily readers. A leader board shows the top-earning user has raked in more than US$50,000.
Digital gold coins are earned by playing games that involve reading stories or by convincing others to join up. The current exchange rate is 1,600 coins for 1 yuan, with strong players receiving the title of ‘master’.
The payments are an extreme example of financial incentives from discounts to coupons employed by a new generation of Chinese internet firms as they seek to establish themselves in a market dominated by much bigger players.
“Acquiring new users if you’re competing with Alibaba, Baidu, Tencent and traditional mobile players, you need to come up with something new,” said Zhang Chenhao, Shanghai-based managing partner at technology-focused Prometheus Fund.