This year, when Xiaomei went home for the Chinese New Year, she discovered that her family members had a habit of shopping on WeChat Channels, just like scrolling through Douyin or browsing Taobao. WeChat Channels has become a regular e-commerce platform for a group of people.
Tencent has also repeatedly mentioned the commercialization potential of WeChat Channels: At the end of 2022, Ma Huateng said in an internal speech that WeChat Channels is Tencent's hope for the future. It was also in that quarter's financial report that WeChat Channels' advertising revenue was first disclosed: over 3 billion RMB in three months. Tencent's 2023 annual results announcement emphasized that the total user time on WeChat Channels doubled compared to 2022.
Currently, WeChat officially has not published specific figures for WeChat Channels' e-commerce带货. According to Guohai Securities' forecast, the gross merchandise volume (GMV) of WeChat Channels e-commerce in 2023 reached 320 billion RMB, which is roughly 1/13 of Douyin and 1/4 of Kuaishou in the same period (according to Guohai Securities, Douyin and Kuaishou GMV in 2023 were approximately 4 trillion and 1.2 trillion RMB, respectively).
However, because it is backed by the WeChat ecosystem and is in a period of rapid growth, WeChat Channels is hard to ignore: Based on the massive WeChat platform, in 2023, WeChat Channels' monthly active users (MAU) and daily active users (DAU) surpassed Kuaishou, with MAU even approaching Douyin.
According to data from this year's WeChat Open Class PRO (WeChat's annual official event showcasing new capabilities, scenarios, plans, and highlights), the GMV of WeChat Channels'带货 in 2023 grew threefold compared to 2022, with order volume increasing by over 244%.
Against this backdrop, DT Business Observer is curious: Who exactly is buying on WeChat Channels? What are they buying? How do they buy?
Main Consumers of WeChat Channels: Women, Middle-aged and Elderly, Lower-tier Cities
Let's first look at the people who shop on WeChat Channels. Research by Growth Black Box on WeChat Channels users shows that in 2023, nearly 60% of WeChat Channels users use it for "buying, buying, buying." Among them, the proportion of people aged 46 and above using WeChat Channels for shopping is significantly higher than younger groups.
Key information mentioned at the 2024 WeChat Open Class PRO is: "Among WeChat Channels purchasers, women account for 78%, and apparel orders rank first in the industry, accounting for 38% of the total."
Simply put: WeChat Channels covers all age groups, but young people mainly use it for content entertainment, while middle-aged, elderly, and female groups are the main consumers.
Last year, Kantar's research on WeChat Channels users further detailed the characteristics of heavy e-commerce shoppers on WeChat Channels. They mainly fall into three categories:
- Hedonistic shopping enthusiasts in second- and third-tier cities with stable consumption power; about 60% of them spend 2,000-6,000 RMB per month.
- Full-time mothers in lower-tier cities who focus on living expenses; over 80% of them have a family annual income below 200,000 RMB.
- "Town luxury women" living in middle- and low-tier cities who enjoy a refined lifestyle. Over half of these "town luxury women" have a family annual income above 400,000 RMB, 44% spend 6,000 to 12,000 RMB per month, and over 20% spend 12,000 RMB or more.
What do these people who are keen on shopping on WeChat Channels buy?
Food and Clothing Account for Nearly 60% More than Half Are "White Labels"
From sales data, the best-selling products on WeChat Channels e-commerce are mainly concentrated in clothing, food, household daily necessities, and beauty products. Clothing and food have particularly high proportions; in 2023, they together accounted for nearly 60% of WeChat Channels e-commerce GMV.
These categories are also high-repurchase categories. According to Kantar data, the repurchase rates for apparel and bags, personal care and cleaning, snacks and beverages, and beauty and skincare on WeChat Channels e-commerce are between 70% and 80%.
It is worth noting that although beauty products rank fourth in GMV, compared to Douyin and Kuaishou, the proportion of beauty GMV on WeChat Channels is actually relatively low.
In the first three quarters of 2023, the beauty GMV proportion on Douyin and Kuaishou both exceeded 15%, while in 2023, the beauty category on WeChat Channels e-commerce accounted for only 8.5%.
Overall, currently people are more willing to buy essential consumables like "food, drink, clothing, and daily use" on WeChat Channels.
This is related to the current supply chain structure of WeChat Channels. In 2021, 2022, and 2023, among merchants入驻 on WeChat Channels, brand merchants accounted for 6%, 10%, and 15% respectively (for comparison, brand merchants' GMV proportion on Douyin is 50%, and on Kuaishou it is 30%), with the rest being white-label merchants.
On one hand, categories like clothing, agricultural products, and food, which have lower production thresholds, are naturally a paradise for white-label products. On the other hand, WeChat Channels e-commerce, still in the stage of expanding its territory, has relatively low traffic costs, which is an important reason attracting a large number of small and medium-sized white-label merchants to flock in.
According to data from Guohai Securities Research Institute, in 2023, the proportion of natural traffic on Douyin e-commerce was close to 50%, while the proportion of natural traffic on WeChat Channels in the same period was about 70%. In other words, compared to other platforms, merchants can currently get more natural traffic support on WeChat Channels.
From the perspective of traffic costs, in 2023, the GMV monetization rate (the ratio of platform e-commerce GMV converted into platform revenue, mainly through commissions and advertising) for WeChat Channels was 1.8%, significantly lower than Douyin's 6.1% and Kuaishou's 3.4%.
To use a not entirely appropriate metaphor, the current WeChat Channels is like a shopping mall with cheaper "rent," and merchants in different categories and at different stages of e-commerce development are basically focused on the "private domain linkage" of WeChat Channels and WeChat, as well as the current platform's "traffic dividend."
After discussing "who buys" and "what they buy," let's break down how people shop on WeChat Channels and why they buy.
Acquiring New Customers Through Recommendations, Repurchase Through WeChat Groups
First, let's look at where buyers come from. Data shows that before the third quarter of 2023, social recommendations such as "follow" and "friend likes" on WeChat Channels accounted for a higher proportion than machine recommendations.
Specifically in WeChat Channels live e-commerce, many people first try WeChat Channels e-commerce shopping through social recommendations. Mumu, a 29-year-old full-time mother living in a third-tier city in Shandong, shared: "My first attempt at WeChat Channels e-commerce shopping was about two or three years ago. I saw the red dot of 'friends liked' on WeChat Channels and discovered that there were带货 live rooms."
For merchants with some private domain accumulation, sharing live rooms to group chats has also brought some new users to WeChat Channels e-commerce.
Jess from Shanghai first used WeChat Channels e-commerce through the WeChat group of a vintage clothing store in Beijing. "The store owner would share the live link to the WeChat group and Moments, chatting while selling. Since I had nothing to do, I chose to enter the live room to take a look."
However, starting from the third quarter of 2023, the proportion of machine recommendations on WeChat Channels traffic has exceeded 50%. That is, people are more likely to "stumble upon" WeChat Channels e-commerce live rooms through public domain traffic.
Additionally, WeChat Channels anchors attract users through activities like lucky draws.
Dahai, a retired worker living in Xi'an, has used both Douyin and WeChat Channels e-commerce. He found that some WeChat Channels e-commerce live streams, due to fewer viewers, make it "easy to win benefits." After trying, he continues to follow the anchor: "Sometimes out of embarrassment for getting something for free, I buy to reciprocate; sometimes simply because the product is good and I need it, so I buy."
Unlike other platforms, WeChat Channels is within the WeChat ecosystem, allowing merchants to seamlessly attract users to private domain traffic pools, thereby maintaining repurchases.
Taking Dahai's experience as an example, in WeChat Channels live rooms, after winning benefits, the anchor often says, "Be sure to add our assistant's WeChat to receive your prize." Through WeChat Channels' "Enterprise WeChat Business Card Display" function, users can directly add the merchant's enterprise WeChat with very simple steps.
Subsequently, the "assistant" will pull users into the merchant's private domain group and regularly post live stream replays and after-sales information in the group. Dahai found that many users spontaneously discuss purchased products in the group, and these discussions also play a role in "planting grass" (influencing purchases). "I usually look at what others say after buying before deciding whether to buy."
The repeated touchpoints of WeChat groups have indeed promoted the high repurchase rate of WeChat Channels e-commerce to a certain extent. As a multi-platform user, Dahai found that "products I bought on WeChat Channels have basically been repurchased, but not on Douyin."
Of course, the difference in consumption paths is only one aspect. In specific shopping decisions, why do people place orders?
Average Order Value Higher Than Douyin and Kuaishou Ordering for "Trust"
One fact is that although WeChat Channels is full of white labels, the average order value is not low.
According to Growth Black Box's "2023 WeChat Channels E-commerce Consumer Research Report," the average order values for WeChat Channels, Douyin, and Kuaishou in 2023 were 205 RMB, 130 RMB, and 88 RMB, respectively. That is, compared to other short-video e-commerce platforms, WeChat Channels has a higher average order value.
Through interviews with WeChat Channels users, we found that WeChat Channels e-commerce, which does not rely on "low prices," sees users more willing to pay for "trust."
Amei, born in the 1970s, currently lives in a city in the northwest. Her main reason for shopping on WeChat Channels is trust and a sense of human touch.
Amei basically shops multiple times a month in 2-3 fixed WeChat Channels live rooms. The live rooms she follows mainly do aerobics and nutrition classes, sharing knowledge and exercises, and selling goods at fixed times each week.
"After making an appointment for the live stream, I get reminders every day, so I basically watch every day." In her viewing experience, Amei summarized: In the live room, the anchor shares trivial life matters. Over time, "it feels like a friend, quite personable. Once you understand, you trust what the anchor recommends." In terms of product selection, "it's basically related to the daily live content, such as yoga socks, fitness clothes, etc."
WeChat Channels merchants are also intentionally targeting middle-aged and elderly groups with differentiated operations emphasizing "human touch" and "trust."
A typical example is the women's clothing brand "Alice Fashion Alice," which posted content on WeChat Channels in August 2022, initially attracting followers with content. Its viral short videos like "Virtuous Wife" and "Independence" had mediocre results on Douyin, but such content is exactly what WeChat Channels users like: The boss lady in the short videos is a "understanding big sister" image, sincere, kind, and positive. She patiently guides employees who make mistakes and, without hurting customers' self-esteem, fulfills the wishes of customers who are short on money to buy a new outfit. The short videos end with a close-up of the boss lady's signature smile.
Subsequently, the live带货 on WeChat Channels continued this style. Coupled with the fact that her clothing audience is close to the main consumer group of WeChat Channels—women over 40 with certain spending power—in February 2023, Alice Fashion ALICE's first live带货 on WeChat Channels sold 3.3 million RMB in 3 hours.
(Alice Fashion Alice WeChat Channels homepage and comment section)
Final Thoughts Of course, compared to other platforms, WeChat Channels e-commerce is not yet mature.
For consumers, limited categories, insufficient product selection, and lack of brand assurance may be limitations of WeChat Channels.
Mumu, a multi-platform user, now rarely shops in WeChat Channels live rooms: "I mainly feel that Douyin live rooms have a better viewing experience, top anchors have richer product selection, faster and more professional explanations, more convenient returns and exchanges, and the anchors are better looking."
For merchants, although WeChat Channels is in a traffic dividend period, it is also a new and unique ecosystem. Lin Yi, founder of Kaiyan Content Technology, mentioned in an interview with Dingjiao: "We tested it. Taking a hit product from another platform, with the exact same script and copy, but changing the blogger, and putting it on WeChat Channels, the effect is much worse."
Additionally, since the main consumers of WeChat Channels are older compared to other platforms, merchants and platforms need to explore more mature operational methodologies.
Just as Taobao and Douyin initially started with white labels and only increased the introduction of brands and big names after traffic grew.
After "Taobao brands" and "Douyin brands," now "WeChat Channels brands" are emerging. However, the logic of WeChat Channels'带货 is not entirely the same as shelf e-commerce or interest e-commerce. Whether WeChat Channels should copy homework and what new story it will tell are questions left for WeChat.
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