How Apps Like WhatsApp, WeChat May Make Money Even while Offering Free Texting And Calling4021120
Ever thought the way a messaging app can make money while giving 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 for example digital payments, online shopping as well as content.
China's WeChat is probably the perfect example of the huge potential which messaging apps hold. With over 900 million monthly active users, WeChat helps them do everything from messaging, buying grocery, hailing cabs, purchasing online food and even offline payments at restaurants - this all without having to go to another app. These types of services not just offer the company outstanding customer stickiness, they also create a remarkable revenue model.
At the moment, WeChat's rivals outside China such as WhatsApp, Facebook Messenger, Skype, Viber and also Line are behind the curve on this front, even though some have begun on the road to becoming larger platforms. "The reason chat apps are growing 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 moving away from being merely a provider of communication tools chat, voice and also video) to being a platform for the exchange of services, payment mechanisms as well as 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 on this week. "Based on research, we know that people are employing WhatsApp to speak with businesses. make business messaging far more convenient for people and more efficient for businesses," a WhatsApp representative said in response to ET's questions. Whatsapp Business is a different app from Whatsapp Messenger, aimed mostly at giving a direct communicating platform to small businesses, many of who might be using WhatsApp already.
While Whatsapp has kept the service free, it may expand it to much larger businesses with added features like analytics, in which it may well charge a usage fee at a later stage, thus making a revenue model, segment watchers said. This actually also is geared at improving subscriber connect that it can make use of for future monetization of their other services. The larger agenda - and a more important one - for these corporations is to get active users to take far more time on the app or services and also make it viable for profit generation, based on analysts.
"Every single technology company is vying for consumer stickiness, interaction and also time spent 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 applications offering free services is not going to be a good revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
