2007.04.10

Tencent Launches New Brand Strategy and Ad Campaign

Tencent today unveiled a billboard ad campaign that will run in major Chinese cities like Beijing and Shanghai. Gracing the billboards will be illustrations of whales hawks and lions designed using the company's well-known QQ user icon. The illustrations symbolize the idea that 230 million QQ users working together can create something powerful. Tencent also announced its new brand strategy slogan: "High Response Great Impact."

"Online Life"

Tencent secretly began planning its new brand strategy last year. The company embarked on a comprehensive business layout design after clarifying the strategic objective of "online life" in 2005. People use the Internet for information communication entertainment and business. To accommodate user needs Tencent began to diversify its services to include Internet value added services. Wireless services interactive entertainment Internet media and e-commerce.

Mr. Lau Seng Yee Executive Vice President Online Marketing Services & Corporate Branding Tencent has been pleased with Tencent's outstanding service portfolio in China's Internet market. As the Internet increasingly ventures into the realm of traditional industries Internet advertising search engines and e-commerce will become key areas of growth. To carry out its "Online Life" strategy Tencent must be prepared for these trends. Tencent's new brand strategy will acknowledge user contribution to Internet's growth while reaffirming the company's commitment to helping Internet users fulfill their social networking needs in "online life".

Changing people's perception of Tencent

The announcement of this new campaign marks a turning point in Tencent's brand development. Tencent's brand image has long been perceived as "childish and fun." This perception not only limits Tencent's user base but also hampers the company's further development.

The high level of services Tencent provides has long since carried Tencent past the phase of "childish and fun." "China has 137 million Internet users most of whom are Tencent users between the ages of 15 and 30. Despite their youth these users are not lacking in beliefs or values. On the contrary these users need positive feedback from the Internet" commented Mr. Lau.

In a recent letter to users and partners Ma Huateng said that during the last NPC and CPPCC more than 150000 Internet users made suggestions to the premier and voiced their concern about the national economy and people's livelihood via QQ.com. On the eve of the 2007 Spring Festival nearly 500000 overseas Chinese watched the Spring Festival Gala through Tencent's platform. QQ users such as QQ Volunteers and QQ Mothers also mobilized to address public concerns such as public welfare environmental protection and the plight of disadvantaged groups. Ma believes that as its platforms play an ever more important role in people's daily lives misperception of the Tencent brand would not accurately reflect the relationship between Tencent and its users.

Tencent now boasts 230 million active accounts. Each user has an average of 40 online friends and is a member of three to five discussion groups. Subjects that QQ users most frequently talk about are work study colleagues and classmates traveling shopping games movies and television.

For Ma China's Internet industry has now entered the "influence economy" phase where creative and interactive communities play a key role. Tencent's new brand strategy will emphasize the Internet's role in bringing means of cooperation excitement and creativity to users' lives.

Focus on Internet Advertising & Marketing

Tencent's new brand strategy will not only help mature its brand image but also accelerate Tencent's development into a multi-media platform.

According iResearch China's market for Internet marketing is worth CNY6 billion a 44% increase of from the 2005 figure of CNY4.17 billion. This market is expected to grow to reach CNY8.3 billion by mid-2007 (+38% over 2006) and could be worth CNY23 billion by 2010.

In July 2006 QQ.com became China's most popular web portal. By the end of 2006 Tencent counted over 230 million active QQ IM accounts 57 million active Qzone accounts and at least 2.71 million QQ gamers online at any given time. With this many users the company's platforms are well positioned to leverage new Internet advertising and marketing models.

The company plans to establish guidelines for its advertising and marketing clients. Its new brand strategy signals a more mature and comprehensive Tencent for Internet advertising market. The new slogan "High Response Great Impact" embodies Tencent's commitment to help its partners rapidly establish their brand influence and build a multi-layered marketing platform.

Mr. Lau believes that Tencent's platforms place the enterprise far ahead of its competitors. The strength not only lies in the four influential platforms but also is exhibited by its good interactivity and promptness. With their slogan in mind Tencent has already integrated IM portal gaming and personal space into a powerful interactive marketing platform. Cooperating with Coca Cola last year Tencent offered a customized marketing program combining portal ads avatars online pets and personal spaces. With the efficiency of QQ user ends Tencent can also accurately identify a specific group of users and take the most effective approach in marketing to target users.

Many enterprises that closely relate to people's daily lives such as Coca Cola China Merchants Bank Lenovo China Mobile and Citroen have started to use Tencent platforms as integrated media to communicate with consumers online. With its new brand strategy underway Tencent is set to bring major innovation to the Internet marketing sector.