“World’s most powerful app” still far behind WhatsApp.

“World’s most powerful app” still far behind WhatsApp.

Tencent Holdings Ltd.’s strategy for expanding WeChat Pay globally is pretty straightforward: Follow the (tourism) money.

Grace Yin, operations director of WeChat Pay’s international business, summarized Tencent’s approach at the RISE Conference earlier this month in Hong Kong:

If a place has a Chinese tourist, then this place is our target.

It’s a smart strategy. Simple, elegant and actionable with WeChat Pay now accepted in 25 countries.

But it’s also decidedly unambitious. The focus in those 25 nations is solely on the merchant side of the equation — to accept money from Chinese travellers.

“We don’t have a plan in the next three years to do a payments wallet outside of China, except Hong Kong and now also Malaysia,” Yin told me. My first thought: What a wasted opportunity.

I understand her thinking. WeChat is a decidedly Chinese phenomenon. While it’s ubiquitous and even crucial to daily life there, it’s the No. 1 chat app in only three countries, according to the annual Global Digital report published by WeAreSocial and Hootsuite. WhatsApp is the leader in 128 countries while Facebook Messenger reigns in 72. Even Viber is more widespread.

But those apps don’t offer payments in all those countries. Although WhatsApp and Facebook Messenger have more users, WeChat’s depth of services — including bookings, bike rentals, payments, MiniApps and news — make it the world’s most powerful.

Facebook Inc. has squandered its $19 billion WhatsApp purchase of four years ago by doing nothing to expand its feature set. (Facebook does at least see the potential, having decided to dip its toe in the water by rolling out WhatsApp Pay in India, a project that recently hit some hurdles over privacy concerns.) Meanwhile, its own Facebook Messenger app has barely innovated.

Tencent’s lack of interest in taking WeChat Pay to a broader market is based upon the fact that the rest of the world is relatively small.

Head office staff say only 20 per cent of the app’s users are registered outside of China, according to Matthew Brennan, the founder of China Channel, a WeChat consultancy. That would put the number at about 200 million, a figure I have trouble believing. By analyzing survey data from Global Digital and after discussions with another industry folk, I would put the figure at more like 100 to 150 million. I’m willing to be corrected if someone has reliable data they can share with me.

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