YIBADA

Tencent Pushes WeChat Ads for More Profit

| Mar 19, 2016 09:22 PM EDT

Tencent Holdings Ltd. chairman and CEO Ma Huateng reveals profit increase for Q4 2015.

Tencent Holdings Ltd. continues its revenue boost tactics with WeChat ads in a bid to climb up and keep up with some of its biggest competitors in the industry.

Recent reports indicate a 22-percent increase in the company's profit during the fourth quarter of 2015 thanks to its online gaming and advertising revenue.

However, WeChat, China's biggest instant messaging platform, has becomes much less popular because of the sudden appearance of ads in the mobile app, The Wall Street Journal reported.

In the report, the WSJ revealed the effects of the addition of advertisements in WeChat to users like Ren Jing who turn to the social media platform to book a ride, purchase movie tickets and contact her friends.

According to WSJ, WeChat is facing a big problem catching up with its competitors in terms of increasing profit after having attracted 700 million active users worldwide.

Because of this, the company decided to push ads like what Facebook did, an aggressive move that users like Ren did not like.

Despite her aversion to the app, she had no choice but to continue using it because all of her friends and colleagues are using it.

"There is no escape from WeChat. My friends and business contacts are all using it," she told the outlet.

Of course, Tencent is trying its best to balance out WeChat's user-friendly interface with the new profit-acquiring advertisements.

Now, thanks to the changes Tencent applied, Bloomberg sees a rise in China's programmatic ad market, which the Shenzhen-based company as well as other big players like Alibaba and Baidu continue to dominate.

"Programmatic ads in China may rise 48 percent to $9.3 billion, according to eMarketer, representing 50 percent of all display ads. Alibaba, Baidu and Tencent account for 90 percent of the programmatic market, with Alibaba alone generating 60 percent," Bloomberg reported.

Despite this, Tencent is still a far cry from being an equal competitor to Mark Zuckerberg-founded Facebook, which reported a 57-percent spike in terms of ad revenues during the fourth quarter of 2015.

Related News

Most Popular

EDITOR'S PICK