How Apps Like WhatsApp, WeChat Could Make Money While Offering up Free Texting And Calling4432923
Ever wondered the way a messaging app could make money while offering free texting and calling? WhatsApp users at India might be surprised to know that there's 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 one of the best example of the huge potential which messaging apps hold. With more than Nine hundred million monthly active users, WeChat enables them do anything 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 provide the company unbelievable customer stickiness, they also create a remarkable revenue model.
At this point, WeChat's competitors outside China such as WhatsApp, Facebook Messenger, Skype, Viber as well as Line are behind the curve on this front, although some have begun on the road to becoming larger platforms. "The reason chat apps are widening 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 away from being simply a provider of communication tools chat, voice and video) to being a platform for the exchange of services, payment mechanisms and content consumption."
WhatsApp, the biggest messaging app on the planet with 1.3 billion every month active users, introduced a business version in India early this week. "Based on research, we all know that people are employing WhatsApp to speak to businesses. make business messaging less difficult for people and much more effective for businesses," a WhatsApp spokesman said in response to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mainly at giving a direct communicating platform to small enterprises, the majority of who might be using WhatsApp already.
Whilst Whatsapp has placed the service free, it could expand it to bigger businesses with added features for example analytics, from which it may well demand a usage fee at a later stage, hence developing a revenue model, segment watchers said. This actually also is geared at improving subscriber connect which it can leverage for future monetization of its other services. The larger agenda - and a more important one - for these businesses is to get active users to take a lot more time on the app or services and also make it viable for profit generation, according to experts.
"Each technology company is vying for consumer stickiness, interaction and time invested on the app, and in order to keep them in the app's ecosystem they are broadening themselves to turn into platforms. Merely being messaging apps offering free services won't be a solid revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
