Tencent recently added yet another app called Intoo (音兔, or music bunny) to its short video app matrix as the company keeps playing a hard catch-up game with Tik Tok, which is not only the leading short video app in China but also a phenomenon in many Southeast Asian countries, including Malaysia and Indonesia.
With Tencent’s Intoo, users can convert their videos and photos into short music videos and share them with friends on WeChat Moments, just like how Tik Tok, or the other 11 similar apps the Shenzhen-based tech giant has launched would work. Intoo is the latest development to come out of Tencent’s short video push; the company now has 12 short video apps on the market.
The way Tencent has cast its nets so widely when it comes to short videos looks is due largely to the strong competitiveness and user stickiness shown by Tik Tok and other Toutiao products, which are threating Tencent’s dominance in social networking services.
According to the latest data from market research company QuestMobile, Kuaishou, Toutiao products including Tik Tok, Xigua Video and Huoshan, still rank higher than other apps concerning user popularity in the short video industry. The latest report by iResearch also highlights the first-mover advantage with over 90% of users preferring the aforementioned apps, with Tencent’s short video apps out of the picture.
As a late-comer in the short video field, Tencent seemingly has adopted such a strategy to compete: First, it launches multiple products to pepper the market and encourage competition amongst those products to allow for “the survival of the fittest”; and then, let the fittest(s) compete with the current market leaders, namely Tik Tok, etc.
However, it remains to see if such a strategy works especially when now short video traffic is highly concentrated on the top ranked apps. Shen Meng, Executive Director of Chanson Capital told a local Chinese financial media Lanjinger that short video apps are social networking services; having multiple products will dilute the network effect Tencent could amass for just one app.
That’s why even by leveraging on WeChat’s huge traffic, it might still hard for the Tencent’s short video matrix to “grow the snowball”. Tik Tok has cultivated its own social network. Unless Tencent could introduce something really disruptive to its apps, otherwise the short video market in China will strictly follow the early-adopters and winners take all rule.
KRA Comment: Short video products on the market are clearly homogenized. Top platforms such as Douyin and Kuaishou all tout their “diversified content and users”. Late-comers such as Tencent will have to aim at niche markets and look for differential positioning so as to catch up the front-runners. Tech giants might have the resources to trial the ‘matrix tactic’, but at the expense of an amassed net effect which is critical to building up a short video app that could rival the top players, which all have cultivated their own community.