Sunday, September 06, 2015

QR code is extremely popular in China but why not in the U.S.?

Following the China Digital Marketing Group on LinkedIN, I came across one discussion about QR code a few days ago. Then I suddenly realized that I have not scanned a single one since I came back to U.S. after my summer vacation in my hometown---Shanghai, China. When I was in Shanghai, I used QR code very frequently. I would add my friends on WeChat by scanning their QR code ID. I downloaded apps and requested subscription and push service by scanning QR code on posters, computer screens and advertising boards on subways. Every time I came to a restaurant, the first thing I would do was to scan the QR code on the small advertising board stood on the table to follow the official account of the restaurant on WeChat. And then I could get coupons, free drinks or discounts as a first-time customer.  I even made payments by scanning the small square which would directly connect me to the interface of AliPay ( an app like Paypal). All I need to do then is to confirm the payment amount and click "Pay", without typing in any digits. But since I came back to U.S. in late July, I only used QR code for two or three times to board the airplanes

After doing some research, I find that there are two big reasons pushing up the popularity of QR code in China. One is WeChat and the other is the growing number of Chinese mobile internet users. 

In September 2012, Huateng Ma, the CEO of Tencent (company that owns WeChat), emphasized the huge potential of QR code in O2O (online to offline) and the company's strategy to push QR code on China's Internet Conference. Later, the QR code scanner function was built into WeChat. Being the most popular social network and an all-purpose mobile platform in China, WeChat definitely promoted the QR code's usage and commonality as users can now interact with the various functions such as making payment, getting information push service etc. in WeChat with those little squares so easily. It is more personalized and customer-oriented. You don't have to type in anything. You won't be bothered by switching among different apps or webpages. The high usability and network externality brought by WeChat make QR code a mania in China.

The other powerful hand is the huge population of mobile internet users. According to the China Internet Network Information Center's (CNNIC) 35th "China Internet Development Statistics Report", by December 2014, about 85.8% of internet users, which is about 557 million, connect the Internet through mobile devices.  And among the 1.29 billion mobile users, by February 2015, about 48.8% of them are mobile broadband (3G and 4G) subscribers (Data via Sina Tech).  Network externality has grown exponentially along with the widespread coverage of Internet and increasing number of mobile internet users, which has made QR code a very powerful and involving tool in people's life. 

Finally, back to the question why QR code has not become popular in U.S. I think a key reason is that none of the popular social network apps in U.S. has incorporated or emphasized the QR code scanner function. There are some QR code scanner apps available in Android market and IOS App Store. But as a separated application, the most exciting power of QR code---easing interactions with various other platforms, is limited. Breaking the barrier to network externality is important for QR code to become popular in the U.S. market. 


Reference: 
http://www.cac.gov.cn/2015-02/03/c_1114237273.htm
http://www.cnn.com/2015/02/03/world/china-internet-growth-2014/

http://www.cac.gov.cn/2015-02/03/c_1114237273.htm

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