Alibaba and Tencent Reach Partnership on Key Business Ahead of Singles Day Festival

BEIJING, October 3 (TiPost)— Two Chinese internet behemoths reached a partnership on their key businesses ahead of China’s most import online shopping festival in a year.

Credit：Visual China

Alibaba Group and Tencent Holding Ltd said they will further cooperation on advertising. They will offer high-quality advertisements placed on Tencent’s short video feature WeChat Video Channel, its blogging feature WeChat Moments and mini-programs on the popular social media app through Alimama Uni Desk, Alibaba’s digital marketing platform, and the traffic from these WeChat’s features can be directly connected to shops and live-streaming rooms on Alibaba’s major e-commerce platforms Taobao and Tmall.

Alibaba and Tencent will also embark on in-depth integration on crowd complementation, system co-construction and other areas to meet the different business objectives of merchants in three major business centers-- stores, live-streaming and content. The deepening cooperation aims to ramp up their preparation for this year’s Singles’ Day, or Double 11, the largest annual online shopping event in China. The two companies will collaborate in the event and invest hundreds of millions dollar of subsidies to boost traffic and facilitate deals of online stores.

Tencent and Alibaba can achieve win-win results through the new partnership as the former has a huge user base and major social media platforms, and the latter operates the powerful e-commerce and payment platform, commented Bai Wenxi, the chief economist at IPG China. "Tencent advertising can import its own traffic to Taobao and increase its own ad revenue by access to Taobao; while Taobao can obtain more potential consumers and increase sales opportunities through Tencent's traffic import, "Bai said.

Involving one of Tencent’s core businesses, the new partnership suggests Tencent is opening up its core traffic resources to Alibaba and a huge step forward two tech giants’ further breaking the’ “walled gardens”. Moreover, the recent cooperation runs further and deeper than the move in the past two years.

Chinese tech firms started opening up following the government’s direction. In September 2021, the Ministry of Industry and Information Technology (MIIT) of China held a meeting with companies Tencent and Alibaba and proposed standards to order all the internet platforms to be unblocked. Ensuring normal access to legal URLs is the basic requirement for developing the internet, a senior official from the ministry said following the meeting. He added that unjustified blockages of web links affect users’ experience, undermine users’ rights, and disrupt market orders. Tencent that month later announced to allow users to access external links on WeChat in one-to-one channels. Tencent’s Creative Content Services Platform the same month applied for access to Douyin to share derivative videos from its copyrighted films and shows.

In the end of November, 2021, Tencent updated its rule to allow WeChat users to directly access to external links in the one-to-one messaging, and launch a feature to unblock the access to external links for e-commerce services on group chat as a trial. It also pledged to continue to promote stopping blocking each other’s links with other major internet platforms, and actively work with other platforms to implement MIIT’s proposal, explore technical possibility of other platforms’ smooth delivering WeChat services, so as to offer better experience to users.