China third party payment market report part 2 – Tenpay
No. 2 Tenpay
- 1. Brief introduction
Tenpay is the main competitor of Alipay. Tenpay is eveloped by Tencent company, which owns the most popular IM in China – QQ with more than 300 million users.
More than 200,000 shopping website accept Tenpay. Tenpay is compatible with the e-banking service of major domestic bank. Users can use Tenpay to send payment, receive payment and withdraw money to bank account. Users can also use Tenpay to charge mobile, deposit money to game account, buy air ticket, which help to make life and payment easier. Tenpay also provide excellent payment platform to corporate users, covering B2B, B2C and C2C areas.
- 2. Features
1) Huge user base
All the QQ users(more than 300 million active users) use Tenpay to buy virtual products like 3D show, QQ pet, QQ currency, QQ game. Tencent also owns the second largest auction site in China – Paipai.com, all the merchants and buyers on Paipai are required to use Tenpay by default.
2) Strategic cooperation
According to a market report, epayment is more popular in these industries: travel, game, auction and airline. Alipay has dominating advantage in B2B and C2C due to the strong network support by Alibaba Inc in those industry. But Tenpay is more successful in marketing. With an aggressive marketing strategy, Tenpay has become the primary payment option for industry leader in travel, game and airline industry.
In 2009, Tenpay has reached a partnership agreement with Eastern China airline(Alipay is also trying to partner with Eastern China airline but the airline company choose Tenpay), to allow Eastern China Airline users(most of them use QQ) to buy air ticket with Tenpay.
Tenpay also partner with Ctrip.com(the leading travel service provider) in 2009 to provide convenient payment service to travelers.
In gaming industry, Tenpay has partnered with Shanghai-based online game company Nineyou to provide online payment and recharging services, Tenpay has already partnered with online game companies such as Perfect World (Nasdaq:PWRD), Kingsoft (3888.HK), NetEase (Nasdaq:NTES), Guangyu Huaxia and CDC Corporation’s (Nasdaq: CHINA) online gaming unit CDC Games’ 17Game, and will soon partner with Sohu (Nasdaq:SOHU) and The9 (Nasdaq:NCTY), the report claimed.
Apart from that, Tenpay has been accepted by more than 200,000 e-commerce site in China.
Tenpay is free to send, receive and transfer payment, like Alipay and other online payment solution.
Tenpay is compatible with the e-banking service of major domestic bank.
- 3. Users base
We will look at the user base from 3 perspective:1) Tenpay statistics; 2) market research firm’s statistics; 3) technical statistics
According to statistics released on tenpay.com, Tenpay has more than 70 million registered users.
market research firm’s statistics
According to statistics released in the “China third party payment market” by Analysys, Tenpay has 78 million registered users, compared with 162 million registered users of Alipay.
The traffic of Tenpay.com rank 5786 globally , the traffic has decreased 16% in the past 3 month. Comparatively, alipay.com rank 1327 globally, the traffic to this website has increased 6.3% during past 3 month.
So generally, we think the users number of Tenpay is about 78 million.
- 4. Market share
According to third party payment market analysis report by Analysys, Tenpay’s market share has reached 20.5% in the first quarter of 2009.
Tenpay rank No. 2 in China online payment market, compared with with 51.2% market share of Alipay, the industry leader.
- 5. Growth rate
According to quarterly comparison chart of China major third-party payment companies between Q1 of 2006 to Q1 of 2009 by iresearch, Tenpay’s market share has grown from 10% in Q1, 2006 to 20.5% in Q1, 2009. In short 3 years, Tenpay’s market share has increased 10.5%, compared with 21.2% market share increase by Alipay in past 3 years.
However, in Q 1 2009, Tenpay’s market share has increased 1.3% while its main competitor Alipay has only increased 0.3%.
- 6. Geographics and Democratics of Alipay users
a) International Geographics
According to Alexa, 98.7 users(visitors) of Alipay come from China, only 1.3% visitors come from other country. So the users of Tenpay are mainly from China.
b) Traffic sources
Alexa statistics show that 43.24% visitors come from qq.com, 13.87% visitors come from paipai.com(qq.com and paipai.com are also owned by tencent company). Generally, 57.11% Tenpay users come from Tencent network. That suggest, like Alipay, Tenpay’s success is also closely related with the strong network support of Tencent company.
Screenshot of Tenpay visitors sources by alexa
d) Age of Tenpay users
According to the demographics on Alexa, most users age of Tenpay is between 18 to 24 year old. Second largest users group is between 25 to 34 years old. That suggest, like QQ.com, Tenpay is extremely popular among young people. On contract, Most alipay users are between 21 to 34 year old, that suggest the users of China online payment service mostly are young people and the users of Tenpay are a bit younger than Alipay.
Age range for Tenpay users
e) Gender of Tenpay users
According to Alexa demographics, male users number of Tenpay are slightly bigger than female users.
f) Education background of Tenpay users
According to Alexa demographics, Tenpay users both cover the educated and non-educated people. Noticeably, non well-educated users are the biggest users group of Tenpay, that means education is not a threshold of Tenpay.
- Future trends
Tenpay’s market share hasn’t reached half of Alipay’s market share, but Tenpay has the potential to catch up with Alipay, or even exceed the market share of Alipay. There are two reasons for that:
1) Tencent company has 870 million QQ users, including more than 300 million active QQ users. QQ alone has more users number that the combination of Alibaba network(Alibaba.com, taobao.com, alimama etc). So Tenpay users number can catch up or even exceed the user number of Alipay.
2) Tenpay has achieved a more successful strategic cooperation with main leading companies in travel, airline, gaming etc. With their aggressive marketing strategy, they can continue to beat Alipay in expansion.
 According to http://www.hktdc.com/info/vp/a/ict/en/1/2/1/1X05XF4N/Information—Communications-Technology/Ctrip-partners-with-Tenpay-for-online-booking-payment.htm
 According to http://mch.tenpay.com/market/st_intro_06.shtml
 According to the report at http://news.xinhuanet.com/internet/2009-06/09/content_11512596.htm
 According to http://news.xinhuanet.com/it/2009-06/14/content_11540340.htm