Baidu is allocating $30 million for a joint company with Youzan, one of China’s largest third-party providers of in-app retail services, as the search giant looks to accelerate the development of its mini-program ecosystem.

Why it matters: Mini-programs, lightweight alternative to apps, are fast becoming a key channel for merchants to engage with users.

First introduced on Tencent’s WeChat, most of China’s tech players, including Alibaba and ByteDance, are aggressively exploring their potential.

The market for software-as-a-service (SaaS) vendors that help companies to set up and maintain mini-programs is also booming.

Monthly active users (MAU) of Baidu mini-programs hit 250 million in July this year, just one year after their introduction on its search app.

In comparison, WeChat mini-programs boasted 400 million MAU as of April last year.