Tencent's (OTC:TCEHY) WeChat is the most popular messaging app in China. Its monthly active users (MAUs) rose 20% annually to 963 million last quarter, and its growing ecosystem allows users to make payments, hail rides, order food, and access other services without ever leaving the app.

Weibo (NASDAQ:WB), a microblogging platform which is often called the "Twitter of China", reaches a smaller audience but has plenty of momentum. Its MAUs rose 28% to 361 million last quarter, and its expanding ecosystem now includes video streams, Reddit-like forums, and mobile payment capabilities from Alibaba (NYSE:BABA).

A young woman takes a selfie.

Source: Getty Images.

Many analysts see WeChat as the 800-pound gorilla and Weibo as the scrappy underdog. However, a recent Accenture report found that Weibo is actually more popular than WeChat among China's "Gen Z" users, the digitally native generation which was born after 1995.

Older generations all favored WeChat over Weibo. Does this study indicate that Weibo's moat against WeChat is actually wider than it initially appears?

A familiar market shift

Tencent is often called the "Facebook (NASDAQ:FB) of China" because it's the country's top social media company. In addition to WeChat, it owns the older PC messaging app QQ, which has 850 million MAUs, and the social network Qzone, which reaches another 606 million MAUs.

WeChat's mobile app.

WeChat. Source: iTunes.

Weibo's microblogging site resembles Twitter, but it also includes elements of YouTube and Instagram, and mimics Snap's (NYSE:SNAP) Snapchat with its vanishing posts. Therefore, it isn't surprising that the same age split between Facebook and "younger" apps like Instagram and Snapchat is also playing out in China.

WeChat's ubiquitous usage and its heavy presence in the enterprise world make it a standard communications tool, but it's also one that allows parents to easily keep tabs of their kids. As a result, younger users are migrating toward alternative platforms, like Weibo and even Tencent's older QQ app. Earlier this year, a survey by Meitu found that 33% of "post-00" (those born after 2000) users saw WeChat as an "app for adults".

Weibo's international app.

Weibo's mobile app. Source: Google Play.

But does the market shift matter?

There were 250 million members of Gen Z at the end of 2016, according to China's National Bureau of Statistics. That demographic is also a major target for e-commerce players, since Accenture's survey found that 70% of that group was willing to buy goods on social media platforms. Just 60% of the post-80s generation and 58% of the post-90s generation were willing to do the same.

That sounds like great news for Weibo and Alibaba, which is the company's second largest stakeholder after online media giant SINA. Alibaba, which integrates its Taobao and Tmall features into Weibo, needs Weibo to widen its moat against Tencent, which is partnered with Alibaba's rival JD.com.

A young woman takes a selfie.

Source: Getty Images.

However, many Gen Z users likely use both WeChat and Weibo, just as many younger users in the U.S. simultaneously use Facebook, Instagram, and Snapchat. It's doubtful that Weibo can convince all its users to stop using WeChat, and vice versa -- so companies will likely continue promoting their products on both platforms.

Moreover, younger users generally have less purchasing power than older users. That's why Facebook continues to generate double-digit revenue and earnings growth, while Snap has no clear path toward profitability. Accenture's survey also notes that younger users are more prone to impulse purchases, with a higher return rate than older users -- which could make them a less desirable demographic.

So what does Accenture's survey actually tell us?

Accenture's Gen Z survey shows that Weibo has staying power, but it doesn't mean that Tencent is struggling. However, Tencent investors should note that unlike Facebook, which uses Instagram as a way to retain younger users, the company doesn't have a comparable youth-oriented platform.

QQ and Qzone are both shedding users, with MAUs respectively slumping 5% and 7% annually last quarter. That's probably why Tencent previously invested in Snapchat, and invested in the popular photo and video streaming app Kuaishou earlier this year.

But for now, investors shouldn't fret over Tencent's future. Analysts expect WeChat and its growing portfolio of video games to respectively boost its revenue and earnings by 53% and 52% this year -- making it one of the top growth plays on the Chinese tech industry.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.