Chinese Internet Giant Tencent Opens Its Trove of Data to Agencies
Chinese internet giant Tencent is massive in scope and in the variety of ways it reaches users. Its mobile social platform WeChat has about 650 million monthly-active user accounts; another platform, QQ, has 860 million. It's big in games, music, video and news. And it has the data that goes with all that.
Tencent announced Friday that it's opening up its data to Dentsu Aegis Network and WPP's GroupM. The Chinese internet company expects more agencies to come on board. "We are happy to connect with all the 4As," said Steven Chang, corporate VP for Tencent.
Meg Chen, who heads global media partnerships for Dentsu Aegis Network China's Amplifi division, said the deal would help maximize return on advertising investment and reach people better across different digital platforms.
"Before this deal maybe we could identify user's basic profiles including age, where he lived, basic things," she said. "With this data integration we can understand more about the consumer journey, such as behavior, interest and preference, not just their demographic."
China's top internet companies, which are competing against each other on all fronts, have been working hard to sift through their data and put it to work better for brands. Tencent's rival, Alibaba Group, signed a similar deal with agencies several months back.
In Tencent's announcement Friday, agency groups will be able to map the internet company's data against their clients' own information on customers. For brands, one benefit will be targeting audiences better. Tencent has compiled 2,000 "tags" so far to categorize users.
"Say you wanted someone who's 40 years old, reads IT magazines, listens to Beatles music and watches HBO, then we can combine our tags to get what we want," said Jeff Kwek, general manger for channel business in Tencent's Online Media Group.
Tencent's content offerings are vast: It signed deals to stream HBO programming, NBA games and the first six Star Wars movies. It has traditionally relied mostly on games to make money, but advertising is a fast-growing source of revenue. Ad revenue in the most recent quarter was almost double the year-earlier period, reaching $756 million.
Tencent's data partnership with agencies will also drive insights for brands, Mr. Kwek said. For a cosmetic company, Tencent searched through instant messages in its QQ service to find out who was most often using words like "beauty," "fashionable" and "whitening" (skin-whitening products are big in China and Asia in general.)
"You would think a lot of the users on QQ using these words were from first-tier cities," Mr. Kwek said. But they were actually most prevalent in messages from people in less cosmopolitan third-tier cities.
Tencent partners with China's second-largest e-commerce player after Alibaba, JD.com, and it owns a stake in China's biggest car-hailing app, Didi Kuaidi. That data is not yet available to agencies, Mr. Kwek said.