How Apps Like WhatsApp, WeChat Can Make Money Whilst Offering up Free Texting And Calling3442151
Ever thought just how a messaging app could make money whilst providing free texting and calling? WhatsApp users at India might be surprised to learn that there are far more to messaging apps than communicating. Here's how: by providing services like digital payments, online shopping and also content.
China's WeChat is among the ultimate example of the vast opportunity which messaging apps hold. With more than 900 million monthly active users, WeChat helps them do everything from messaging, purchasing grocery, hailing cabs, ordering online food and even offline payments at restaurants - this all without needing to go to another app. These services not just offer the company extraordinary customer stickiness, in addition they create a outstanding revenue model.
Right now, WeChat's competitors outside China including WhatsApp, Facebook Messenger, Skype, Viber and also Line are behind the curve on this front, even though some have started on the path to becoming bigger platforms. "The reason chat apps are expanding beyond communications is to develop a sustainable 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 merely a provider of communication tools chat, voice and also video) to becoming a platform for the exchange of services, payment mechanisms and content consumption."
WhatsApp, the largest messaging app on earth with 1.3 billion monthly active users, introduced a business version in India early on this week. "Based on research, we all know that people are utilizing WhatsApp to speak with businesses. make business messaging far more convenient for folks and more efficient for businesses," a WhatsApp spokesman said in response to ET's questions. Whatsapp Business is a different app from Whatsapp Messenger, aimed mainly at giving a direct communication platform to small businesses, many of who may be using WhatsApp already.
Whilst Whatsapp has kept the service free, it could extend it to larger businesses with added features like analytics, in which it may well demand a usage fee at a later stage, therefore making a revenue model, segment watchers said. This also is targeted at increasing subscriber connect which it can leverage for future monetization of their other services. The larger agenda - and a more critical one - for these businesses is to get active users to invest far more time on the app or services and also make it viable for revenue generation, according to analysts.
"Each technology company is competing for consumer stickiness, interaction along with time spent on the app, and in order to keep them within the app's ecosystem they are widening themselves to become platforms. Merely being messaging apps offering cost-free services won't be a good revenuegeneration model," said Jayanth Kolla, founding father of Bengaluru-based research firm Convergence Catalyst.
