How Apps Like WhatsApp, WeChat Can Make Money While Providing Free Texting And Calling8497250
Ever thought about the way a messaging app could make money whilst offering free texting and calling? WhatsApp users within India could be surprised to find out that there's a lot more to messaging apps than communicating. Here's how: by providing services for example digital payments, online shopping as well as content.
China's WeChat is among the ultimate example of the great potential which messaging apps hold. With well over 900 million monthly active users, WeChat enables them to do everything from messaging, buying grocery, hailing cabs, purchasing online food and also offline payments at restaurants - all of this without needing to go to another app. These types of services not only offer the company extraordinary customer stickiness, they also create a wonderful revenue model.
At this point, WeChat's opponents outside China such as WhatsApp, Facebook Messenger, Skype, Viber and Line are behind the curve on this front, although some have begun on the way to becoming bigger platforms. "The reason chat apps are expanding beyond communications is to build a lasting monetisation strategy," said Neha Dharia, a senior analyst with a focus on messaging at London-based research firm Ovum. "Chat apps are shifting from being just a provider of communication tools chat, voice as well as video) to being a platform for the exchange of services, payment mechanisms as well as content consumption."
WhatsApp, the largest messaging app on the planet with 1.3 billion monthly active users, introduced a business version in India early this week. "Based on research, we all know that people are using WhatsApp to talk to businesses. make business messaging more convenient for people and more productive for businesses," a WhatsApp spokesman said in respond to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mostly at giving a direct communicating platform to smaller businesses, many of who may be using WhatsApp already.
Whilst Whatsapp has kept the service free, it may extend it to much larger businesses with added features such as analytics, in which it may well demand a usage fee at a later stage, therefore developing a revenue model, segment watchers said. This actually also is targeted at raising subscriber connect which it can leverage for future monetization of their other services. The greater agenda - and a more important one - for these companies is to get active users to spend much more time on the app or services as well as make it viable for profit generation, based on experts.
"Each and every technology company is vying for consumer stickiness, interaction along with time spent on the app, and in order to keep them around the app's ecosystem they're widening themselves to turn into platforms. Simply being messaging applications offering cost-free services won't be a strong revenuegeneration model," said Jayanth Kolla, founding father of Bengaluru-based research firm Convergence Catalyst.
