Super Apps: We Chat Explained using Business Model CanvasEstimated Reading Time: just 4 min

The Business Model Canvas (BMC) is the structure of a business plan on one single page.

The Canvas is popular with entrepreneurs and intrapreneurs for business model innovation.

Fundamentally it delivers three things:

  • Focus: since it is more concise than a traditional business plan
  • Flexibility: sitting on a single page it is a lot easier to tweak than a business plan
  • Transparency: it makes a much easier to understand a business model

This business model design template is based on:

  • Customer Segments
  • Value Propositions
  • Channels
  • Customer Relationships
  • Key Activities
  • Key Resources
  • Key Partners
  • Revenue Streams
  • Cost Structure
  • Social & Environmental Benefits/Costs

An interesting case study of how to apply the Business Model Canvas is WeChat.

WeChat is a multi-purpose app developed by Tencent and it is often referred to as the first successful “super-app”.

Tencent is a public Chinese company that is headquartered in Shenzen, where it was founded by Ma Huateng, Zhang Zhidong, Xu Chenye, Chen Yidan and Zeng Liqing in November 1998.

The project for WeChat creation started at Tencent in October 2010 and lead to the launch of the app in January 2011.

The idea that stood behind the app was to turn the so-called Great Firewall present on the Chinese internet into an opportunity.

The Great Firewall of China (GFW) is the combination of legislative actions and technologies enforced by the People’s Republic of China to regulate the Internet domestically and making it an Intranet.

The main effect of the GFW is that the most successful services that are used in the Western World such as Google, Facebook and Twitter are not available in China.

This made the Chinese e-market a 1.4 billion people green field that Tencent exploited by creating a super-app.

In fact, WeChat embeds the functionalities that can be found in single apps like WhatsApp, Facebook, Twitter, Skype, Uber, Amazon, Instagram, TripAdvisor, Booking, Venmo, Tinder, PayPal and much more.

In 2018, the company:

  • Reached more than 1 billion users of which 0.9 billion are daily active on an average
  • Averaged 38 billion text messages and 6 billion voice messages per day
  • Reached 0.8 billion users paying with WeChat Pay

But what business model made WeChat so successful?

Let’s take a look at it using BMC:

1. Customer Segments: WeChat targets a Segmented Market made of Internet Users and Social Media Advertisers. Segmentation is key and it is based on both:

  • Demographic Factors
  • Psychographic Attributes

Psychographic Attributes are core since WeChat has the possibility to access an infinite set of behaviours due to the massive amount of operations that are performed on the platform. These behavioural data are then processed by Big Data Analytics tools and algorithms that create Buyer Personas that are used as targets for Social Media Advertising

2. Value Propositions: WeChat aims to deliver a super-app to meet every online and offline need of an Internet User by replacing what is usually made with several apps such as WhatsApp, Facebook, Twitter, Skype, Uber, Amazon, Instagram, TripAdvisor, Booking, Venmo, Tinder and PayPal. By collecting and analysing data about Internet Users, Tencent is then able to offer valuable audiences for Social Media Advertisers.

3. Channels: WeChat is based on the installation of an app, that is compatible with almost every iOS, Android and Windows device.

4. Customer Relationships: WeChat bases its relationships with its customers on Communities, Self-Service and Co-Creation in order to be up to date with any need arising on the Internet Users side.

5. Key Activities: the core activities for WeChat are:

  • Designing the Product roadmap
  • Managing and Maintaining the Platform
  • Rolling out new Features
  • Perfecting the Big Data Analytics algorithms for segmenting the users

6. Key Resources: the key assets for WeChat are:

  • The Platform and all its functionalities
  • The Server Farms that guarantee the app is always online
  • Big Data Analytics for segmenting the users

7. Key Partners: WeChat has tight relationships with:

  • Tencent (owner)
  • Chinese Government (as a public service)
  • Devices Brands
  • OS Brands
  • Payment Providers
  • App Developers

8. Revenue Streams: revenues are mainly generated by

  • Social Media Advertising
  • Added Services (such as eCommerce sales and WeChat Pay)

9. Cost Structure: the main expenses for WeChat are due to:

  • Platform Management and IT Systems
  • Legal
  • Expenses
  • Taxes

10. Social & Environmental Benefits/Costs: apparently there are no major Environmental Benefits/Costs related to WeChat Business Model even though, when talking about Social Costs, it could be good to point out that this business model can affect the time people spend on the phone. Increasing time spent on a mobile screen is a concern that emerged also from an interview to Apple CEO Tim Cook at BBC where he stated: “I’ve been using it [my phone] and I have to tell you: I thought I was fairly disciplined about this. And I was wrong. When I began to get the data, I found I was spending a lot more time than I should and the numbers of times I picked up the phone were too many.”

Nicola Zaffonato Administrator

Business Strategy | Product Marketing | Executive Master eCommerce Management | Business Innovation Master | MSc

I am driven by my personal growth and of people/contexts that surround me.

I followed a professional path in Valentino Fashion Group and Luxottica during which, thanks to the ability to understand different businesses and interests, I was able to succeed in Operations, Merchandising and Retail.

These organizations have exploited my ability to mediate and translate needs/constraints into practice, assigning me to Project Management roles.

Luxottica relied on my ability to analyze, to anticipate things and to imagine/implement solutions by appointing me in Supply Chain Management department and assigning me to the Product Management of IoT solutions for Anti-counterfeiting and Retail digitalization.

During this professional path, I also developed my leadership by managing teams to build Processes, Organizations, Systems and Governance Tools.

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