There’s an app out there that’s been downloaded to more than a billion smartphones in China, yet is virtually unknown in North America.
It’s called WeChat, and it might be the biggest app you’ve never heard of.
Some 650 million different people are active on the app regularly, using it for everything from messaging to booking travel to buying products, and everything in between. Although people do mainly use it to talk to each other, it’s less of a chatting mechanism and more of an app-based platform.
Even though it’s immensely popular in China, the app owned by Shenzhen-based Tencent just can’t gain traction on this side of the ocean.
Part of the reason is the app is just an extension of an existing PC-based messaging program already popular in China. Tencent just encouraged users to switch to the app version.
Additionally, after failing to gain much traction in markets outside of China, management decided to just focus marketing dollars there.
WeChat users are already subjected to ads, but the app has successfully added other monetization methods, including taking a cut on purchases made by users and developing a mobile wallet.
WeChat generated $1.8 billion in revenue for the first quarter of 2016, while Facebook Messenger and WhatsApp, its two biggest rivals, were far behind.
Investors looking to invest in this craze must do so via the Hong Kong Stock Exchange, where Tencent Holdings Ltd. trades. Shares aren’t cheap, especially after rallying more than 35% over the last year. They also trade at more than 50 times trailing earnings.
Tech Insider
