This week Tencent held a WeChat Mini Games conference and provided an update about the company’s mini games ambitions. WeChat mini games, which launched in 2017, are H5 games directly playable on WeChat, China’s de facto messaging app. Given that Zuckerberg’s empire is shut out of China (i.e. no Facebook Messenger, WhatsApp, Instagram messages), WeChat is basically the single dominant app that everyone in China uses for all personal and business communications (there are other apps but those are supplementary). For context, WeChat now has 1 billion monthly active users in China.
That’s a long setup to say that the performance of WeChat mini games may be a good indicator of what lies ahead globally for Facebook’s and Snapchat’s instant games. WeChat’s monthly users of mini games reached 500 million for the first time in 2020, which means that roughly 1 in every 2 people on WeChat engage with mini games. This is, of course, a very rough back-of-envelope calculation, but it gives a ballpark estimate for anyone trying to calculate the potential upside for instant games on Facebook and Snapchat.
According to Tencent, players over the age of 30 represent 66% of the overall player base while people from 3rd-5th tier cities represent 60% of the audience. Play time increased by 50% year-over-year, and overall business increased 20% from 2019 to 2020. Content-wise there’s also been an ongoing maturation with both ad-driven and in-app purchase (IAP) driven mini games. Ad-driven mini games evolved from simple puzzle games (in 2018) to simulation games (in 2019) to action and tower defense games in 2020. IAP-driven mini games have also steadily evolved; in 2018 and 2019, RPG games were most prominent, and MMOs + simulated life games (SLGs) started taking share in 2020. Top MMO and SLG mini games have amazing retention — D1-70%, D7-50%, D30-40% — with even one game topping RMB2 billion in revenue (or roughly $300 million).
Going forward, here are some Tencent’s priorities for mini games in 2021:
- Direct account sync with Tencent’s video platforms for better livestreaming experiences
- Improve the playable ad experience
- Better sync with PC to bring seamless cross platform gameplay
- Improve the ad distribution and targeting within Tencent’s ecosystem
Of course, WeChat’s mini games are not the only player in town. ByteDance has also enjoyed tremendous success with instant games on their Douyin app, creating a symbiotic ecosystem of creators, games, and advertisers. For example, #steppypants has 700 million views on the Chinese TikTok platform and could be played directly as an instant game. With the ongoing maturation of H5 game tech and cloud gaming tech, there is a seismic shift coming over the next 5-10 years. Instant games are maturing in China, and it’ll be fascinating to watch how future developments unfold. Could the power of app stores wane and part of the replacement be playing through other important platforms? It’s certainly possible, at least in China, and we’ll keep an eye on how instant games evolve around the world. Read our Playco analysis to learn more.