Gift Giving Gets Social with WeChat's Red Envelopes

    Tencent's latest social gifting and WeChat pay features bring Starbucks into the mix, and luxury brands could soon follow suit.
    Starbucks recently made a deal with Tencent to start offering "social gifting" to its WeChat followers next year. (Shutterstock)
    Jessica RappAuthor
      Published   in Technology

    WeChat has enabled users to leave home without their wallet full of cash thanks to its payment system, and its benefits to consumers are only widening. Its latest feature, coming in 2017, is the first of its kind in China retail and allows users to send their friends lattes through social media.

    The perk comes with Tencent's newest collaboration with Starbucks, which has been working hard in the last few years to appeal to China's new generation of trend-seeking coffee drinkers. Last year, it upgraded many of its locations to its more high-end Reserve brand, began offering its Teavana products late this year, and plans to open its first roastery in China in Shanghai next year. But while other major retail brands, including luxury fashion houses, have recently began offering WeChat Pay to their increasingly cash-free customers, Starbucks has been a little late to the game. Finally, earlier this month, Starbucks announced that not only would it be allowing consumers to pay for their coffee by scanning their WeChat QR code in stores, but that next year, it would be offering “social gifting,” meaning China's WeChat users could send their friends vouchers for Starbucks without even going into the store.

    Gift options will include not only coffee vouchers, but branded products, which customers can send their WeChat friends with a personalized message. The social gifting feature adds another layer to the digital presence Starbucks has in China already, via its own app and its My Starbucks Rewards program, which requires customers to bring in a rewards card.

    Social gifting isn't exactly new, but few, if any, major brands have adopted a permanent feature allowing what is essentially giving a gift card through WeChat. A couple have come close. In 2014, Tencent partnered with a now defunct Chinese startup called Giftpass, which served as an aggregator for gift cards through the app. During Chinese New Year this year, Burberry launched a campaign that enabled its followers to engage with the brand by offering red envelopes that users could digitally fill with money to send to friends and family via WeChat. The red envelopes, a common Spring Festival tradition in China, were also available in stores featuring the fashion label's branding.

    It's likely that Starbucks' latest move could pave the way for more brands to enable social gifting options on their WeChat platform in the future. Already, luxury brands have are beginning to offer e-commerce options within the social media app, so social gifting seems like a logical next step, and brings brands another way to engage with China's mobile users. Aside from funneling the convenience of sales directly through WeChat pay, social gifting is also a method of online to offline marketing, especially for brands that don't already have a WeChat store. Recipients of coffee vouchers, for example, will have to go to a Starbucks outlet to claim their product, and could potentially become new loyal customers for the brand.

    To learn more about WeChat pay and online to offline marketing through China's leading social media platform, click here to download our new report.

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