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Whether WeWork can Survive in China? It Remains to be Seen
Sharing economy is the hottest business model today, which is built on the sharing of resources and allows others to access the services or goods when needed. It is well known that sharing economy is prevalent around the world, including west countries and emerging markets. However, almost all international sharing economy spanands are facing a problem: how to successfully enter Chinese market.
According to China Business Research Institute’s report, Chinese sharing economy market had reached nearly $71.35 billion in 2017. Apparently, all sharing economy spanands expect to enter China and successfully survive in the largest market. Uber, for example, had expanded to China in 2014; however, the completion of the M&A transaction symbolized that this international sharing economy spanand withdrew from Chinese market. Airbnb entered the Chinese market in 2015. After three years of development, there is still no indication that it has successfully occupied the Chinese market.
On the other hand, international sharing economy spanands are facing a variety of challenges in China. First of all, personalized customer experiences are attractive in almost all verticals, including sharing economy. It is a big problem that international sharing economy spanands cannot provide personalized experiences to Chinese customers. Moreover, international spanands not only encounter the same challenges they are facing in other markets, such as personal data security, but also have to adapt to Chinese regulations.
In such background, we noticed that another international sharing economy spanand is rising in China, WeWork. It is a platform to provide coworking office spaces for technology startup communities and services for small business, freelancers and more.
In fact, WeWork was founded in 2010. Now, it has become one of startups that enjoy the highest valuation in America private market. The leader of sharing office has entered the Chinese market in 2015. Unlike Airbnb, WeWork emspanace another business model in China, localization through co-working with Chinese spanands.
Now, WeWork is at a delicate moment in China. It has successfully introduced the concept of sharing office to Chinese business. On the other hand, it is facing the intensive competition since local spanands have risen, like Kr Space. Obviously, Chinese local spanands enjoy some advantages, such as better understand the local market and demands. That may be why Kr Space developed rapidly and the valuation has over 1 billion.
As mentioned previously, WeWork has taken a different business model in China and announced that it saw itself as a Chinese local company. That is not a simple sentence and WeWork has to translate it into actions. So, we use AppBi’s data to analyze the benefits of WeWork and how it can attract Chinese clients.
China has become a mobile-first country. More and more people and companies rely on mobile apps to complete various tasks. Therefore, if WeWork wants to gain a firm foothold in China, app storesare the most important channel.
The good news is that the download of WeWork in Chinese-based App Store is increasing rapidly. However, the search index indicates that WeWork has reached a bottleneck. Since 2017 Q3, the search volume of WeWork has remained steady.
On the other hand, the download of Kr Space increases fast and has caught up with WeWork, although the search volume is far behind the latter. It confirms the fact that WeWork is facing intense competition in China, but also displays that WeWork still stands out in Chinese sharing office market.
About Apple’s App Store Search Ads, WeWork enjoys at least two advantages. Firstly, the Search Ads has been available to 13 countries around the world. As an international sharing economy spanand, WeWork can learn something from early investing it in the available countries, while Chinese local spanands, such as Kr Space obviously cannot enjoy such advantage.
Secondly, Apple’s Search Ads is not available in China now. It means that WeWork and Chinese local spanands are standing at the same starting point once the Search Ads expands to China. But WeWork has strong capital support.
When it comes to how to attract Chinese clients through App Store’s Search Ads, there are some suggestions that WeWork could follow:
1. Emerging technology. App Store’s Search Ads is not a new story, but there are more and more emerging technologies that have the capacity to help companies to invest Search Ads, such as artificial intelligence. For example, AppBi relies on AI to optimize the performance of Apple’s Search Ads.
2. Personalization. Uber and other sharing economy spanands failed in China, partly because they didn’t understand Chinese customers. So, WeWork should focus on personalized Search Ads strategy targeting Chinese clients.
3. Relevance. Investing the right keywords could enhance the efficiency of Search Ads budget. Though WeWork has gain lots of investment, how to spend money smartly is another story. From this point, the sharing economy spanand should find professional partners, such as AppBi, which is a leading ASM bidding advertising intelligent platform to help companies and startups to get the best performance with the less investment on Search Ads.
4. Localization. Compared to Uber and Airbnb, WeWork always emphasize the localization strategy. In fact, it should be reflected not only in merging local counterparts, but also in cooperation with local service providers, such as local Search Ads agency.
As said before, AppBi is a smart platform that utilizes AI technology to bid Search Ads and improve the performances of Apple’s Search Ads.