On 9 January, 2017 , Tencent launched its new keynote function “Mini program” on its WeChat platform. The “Mini program” is seen as a lite version of apps on the WeChat platform, allowing users to use them without having to download and install additional program.

Advantages and limitations of “Mini program”

Advantages

To developers (brands and retailers)

• Lower developing costs than mobile apps
• Can create multiple “Mini programs”
• “Mini programs” are cloud-based, so the system would be more flexible and easily accessible

To users

• Direct authorization of WeChat account details is allowed; users do not need to register or login for every individual application
• Can send feedback (in the form of texts and photos) to administrator of the “Mini program”
• Location-based service (LBS) function is allowed, facilitating O2O services such as food delivery and taxi hailing
• Application package size of each “Mini program” must be less than 1MB; it only takes up limited space of the internal memory of users’ mobile phone
• Shorter loading time than mobile apps
• Ease of use with simple functions
• Push messages are banned so that users will not be disturbed frequently
• Able to use WeChat Payment to make purchases directly on the “Mini programs”

To Tencent

• Expand its ecosystem
• Further increase the utilization rate of WeChat Payment
• Extend Tencent’s lead in the market as an app vender

Limitations

To developers (brands and retailers)

• Unable to share the “Mini programs” on WeChat moments, affecting the distribution of the “Mini programs”
• Users must scan the QR code offline or know the exact name of a particular “Mini program” to locate and launch it; this may also affect the usage and traffic of the “Mini program”
• Subscription function is not available in the “Mini programs”
• No “Mini program” store (similar to Google Play) where users can find all the available “Mini programs”
• Brands and developers are unable to push messages such as advertisements via their “Mini program”
• WeChat imposes strict control on the launch of “Mini programs”. Some categories are prohibited (e.g. games).

To users

• Limited functions of the “Mini programs”
• Unable to access if users do not know the exact name of the “Mini program”

Comments

Tencent hopes to expand its ecosystem with the launch of the “Mini program” and leverage the huge user base of WeChat to monetize the “Mini program”. It is still too early to tell whether the “Mini program” will provide a major income stream for Tencent or a huge boost to its business. Brands, retailers and service providers are still testing the water, and the results are yet to realize.

For brands and retailers, the “Mini program” presents a new channel for them to reach out to their customers. But surely there are some limitations that companies need to consider. For example, companies cannot push messages to users via the “Mini program”, and users cannot share the program in WeChat moments; these may affect the usage and traffic of the “Mini program”. Moreover, WeChat payment is the only payment method supported in the “Mini program”.

Since the rollout of the “Mini program” for internal testing in September 2016, there have been heated discussions about whether the “Mini programs” will replace standalone mobile apps. We believe the answer is both yes and no. Mobile apps with limited and simple functions such as weather forecast, courier enquires, etc. and those rarely-used by users will likely be replaced by the “Mini programs”. However, the common and popular apps, and those professional apps with multiple functions will still maintain their edge, at least in the short run.

We believe the “Mini program” will largely be applied in the local lifestyle service O2O sector such as catering, home delivery, taxi hailing, travelling, etc. It will play a greater role in facilitating O2O integration as users need to scan the QR code offline in order to launch the program.

For users, the “Mini program” serves as another handy “application”. They no longer need to install multiple apps and can free up storage space and internal memory of their mobile phone. The “Mini program” can provide better service than the original WeChat service account and public account as users will no longer be bombarded with advertisements and notices when using the “Mini program”.

In the coming months, we expect more brands and retailers to launch and trial their own “Mini program”; at the same time, they will also review and revise their O2O strategies. New business models and practices may arise in the wake of the launch of the “Mini program”. There are speculations in the market that Tencent’s major competitors, such as Alibaba and Baidu may launch similar initiatives.