Executive Summary : Tencent Holdings Limited

2526 Words Oct 18th, 2014 11 Pages
Executive Summary – Tencent Holdings Limited
Tencent Holdings Limited can attribute its phenomenal growth to the success of its main product QQ. QQ is an instant messaging product that captured a dominant share of the Chinese instant messaging market. Tencent continued its success by broadening its product offerings and creating an entire ecosystem from instant messaging to games to social networks. Recently, the company has started to expand into additional markets, namely India, Indonesia, and Malaysia.
Tencent leads its expansion with the WeChat product, a text messaging service, through a direct export entry method into new international markets. Also, the company uses localized marketing and advertising events to generate brand recognition. The company is willing to adapt its product to the local region taking a variation adaptation global strategy.
The company competes in the Internet content provider arena and its direct rivals are SINA and Sohu.com. But as the company expands into the mobile Internet, Tencent is facing both Alibaba and Baidu, two other Chinese Internet heavyweights. Confronting stiffer domestic competition, a maturing industry life cycle, and lower net profit margins, Tencent has chosen to expand internationally. The five forces of Tencent’s industry is medium to low threats, mainly because Tencent has become a large physical dominator of the ecosystem. The scale of Tencent makes it difficult for companies to compete with Tencent’s…

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