SIT794 - Service Management: Tencent Holdings Report - Deakin Uni

This report provides an overview of Tencent Holdings Limited, a leading provider of value-added services in China. Founded in 1998, Tencent's mission is to enhance lives through internet services. The report details Tencent's service concept, including its diverse offerings such as WeChat, QQ, and online games, and its focus on innovation and R&D. It examines Tencent's operating strategy, highlighting WeChat's revenue generation and its investments in game development and partnerships. The competitive strategy focuses on investments and leveraging online presence to promote online games. The report also discusses Tencent's service differentiation, emphasizing its home-grown advantage, diverse services, and strong distribution channels. The report references Chan (2015) and Yung et al. (2014) to support its analysis.

SERVICE
MANAGEMENT
A REPORT ON TENCENT
HOLDINGS

TENCENT HOLDINGS LIMITED –
AN INTRODUCTION
 Founded in the year 1998, in the month of November.
 Leading provider of value added services in China.
 Went public on 16 June, 2014.
 Mission is to make human lives more efficient through internet services.
 Have influenced the lifestyle of many people with their on-line and
internet services.

SERVICE CONCEPT
 Have been able to cater to the demands of the people of China with
their services.
 Different services are Tencent Open Platform, Tencent Cloud, Tenpay,
Weixin/WeChat, QQ instant messenger, Qzone, QQ games, QQ.com and
others.
 Focuses on innovation and development of new services and
applications.
 The R&D staff consists of more than 50% of the company.
 Have patents of various technologies such as gaming, search engine,
online payments, e-commerce and others.
 Set up their first research institute, the Tencent Research Institute, in
China.

OPERATING STRATEGY
 Generates most of its revenue from the popular instant messaging
application which is WeChat (Chan 2015).
 Generated an annual revenue of RMB 151.9 billion in 2016.
 Made several investments in studios and created their own games (Yung
et al. 2014).
 Builds partnerships with other partnerships to distribute their titles in
China.
 Online games have generated the second most revenue after WeChat
for the company.
 Developed a payment system which was integrated in WeChat, which is
known as Weixin.

COMPETITIVE STRATEGY
 Biggest competitors is Alibaba, which is an e-commerce company.
 Developed various competitive strategies to maintain their foothold in
the market.
 Made several investments among which one is the Tencent Industry Win-
Win Fund which deals with online games, media and internet.
 Took advantage of their strong presence on-line to promote their on-line
games.
 Moved the popular PC titles to mobile and even developed many new
titles.
 Used eSports as a way to create excitement among the people who
would play their games based on the Sports.

SERVICE DIFFERENTIATION
 Home-grown company and uses this as an advantage to expand their
service horizon.
 Provides diverse services unlike their other competitors.
 Most revenue generating application is WeChat.
 Focused on new innovations to attract new customers and retain the old
ones.
 Includes a very strong distribution channel which possesses the ability
to distribute any game.
 Have maintained their position in the market since their inception.

REFERENCES
 Chan, C., 2015. When one app rules them all: The case of WeChat and
mobile in China. Recuperado de http://a16z. com/2015/08/06/wechat-
china-mobile-first.
 Yung, S.H., Cheng, X., Wu, J. and Cheng, S.S., 2014. Capital structure
analysis of Tencent Holdings Limited.