Specialist
Senior executive at iClick (Beijing) Data Technology Co Ltd
Agenda
- Coronavirus pandemic impact on Tencent’s (HKG: 0700) Q2 2020 advertising earnings, plus Q2 and Q3 forecast
- Tencent’s advertisers – industry distribution, Q2 revenue contribution and ranking, plus advertising budget dynamics by industry
- Tencent’s platforms and advertising products, revenue growth trends by segment and main challenges
- Major advertising platforms – agency policies, targets and task assignment, plus delivery strategy adjustment
- Performance-based advertising effectiveness across platforms
Questions
1.
Tencent’s total advertising revenue reached RMB 20.2bn in Q1 2020, up by 19% YoY. Its social advertising revenue climbed by 37% YoY to RMB 16.3bn, whereas its media advertising revenue slid by 24% YoY to RMB 3.95bn. Can you comment on the overall performance of Tencent’s advertising business segment in this Q1? Did it perform better or worse than you expected?
2.
You mentioned that Tencent might register a lower growth in social advertising revenue in Q2 than it did in Q1 because of decreased spending of clients from game and education industries. Did these clients decrease their spending on Tencent’s advertising services because they turned to other advertising service providers or just because they cut their advertising budgets?
3.
You broke down Tencent’s total advertising revenue in 2019 across its various advertising platforms and products for us in an interview in March 2020. Were there any changes in the growth rates and revenue contributions of major platforms and products in Q1 and Q2 this year?
4.
Can you compare Tencent and ByteDance with regard to the asking and selling prices of their media, social and other advertising products and services? How much of a discount does Tencent usually offer?
5.
How did Tencent adjust the sales targets for its major agencies or the so-called platinum-level agencies in Q1 and Q2 this year? Did the agencies achieve their sales targets? Can you comment on the performance of the agencies in H1 this year and predict their performance in H2?
6.
What’s the respective profit margin of the leading advertising agencies that cooperate with Tencent and ByteDance? What are the trends of their profit margins?
7.
Can you comment on the effectiveness of performance-based ads delivered by education institutions, game companies, e-commerce merchants and internet service providers on Tencent? What’s the ROI of these advertisers?
8.
Can you talk on the active user numbers of WeChat moments, official accounts and mini programs? What were the changes in the numbers from 2019 to Q2 2020?
9.
Zhang Xiaolong mentioned that the daily active user number of WeChat video accounts exceeded 200 million in the WeChat Moments on 22 June. What do you think of the positioning of WeChat video accounts and related strategies? Can you estimate the future number of their active users? Will WeChat video accounts become as important as WeChat Moments?
10.
You mentioned that Tencent developed an SDPA (single-product dynamic product ads) solution last time we communicated. Has Tencent launched any new product, developed any new function or had any strategic adjustment in Q2? Do they help to attract more advertisers?
11.
What are the cooperation models between Tencent and mini program and e-commerce service providers including Weimob and Youzan? What do you think of Tencent’s entry into the e-commerce service segment via platforms such as e-commerce mini program and WeChat shops?
12.
Weimob accounts some of its advertising GMV as SaaS revenue, what is your opinion about it?
13.
Does Tencent require exclusive service from its advertising agencies? What will it do if any of its leading advertising agencies also serves Toutiao?
14.
Has Tencent finished the organisational structure adjustment of its advertising business department as of Q2? What are the advantages and disadvantages compared with that over the past two years?
15.
Do you have anything else to share with us?