The Way Apps Like WhatsApp, WeChat Helps Make Money Whilst Providing Free Texting And Calling7915742
Ever wondered how a messaging app could make money whilst offering free texting and calling? WhatsApp users within India may be surprised to discover that there are more to messaging apps than communicating. Here is how: by offering services like digital payments, online shopping and also content.
China's WeChat is among the ultimate example of the huge possibilities that messaging apps hold. With more than 900 million monthly active users, WeChat assists them do almost everything from messaging, purchasing grocery, hailing cabs, ordering online food as well as offline payments at restaurants - all this without having to go to another app. These services not just offer the company outstanding customer stickiness, they also create a exceptional revenue model.
For now, WeChat's opponents outside China such as WhatsApp, Facebook Messenger, Skype, Viber as well as Line are behind the curve on this front, even though some have started on the road to becoming greater platforms. "The actual reason chat apps are widening beyond communications is to develop 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 just a provider of communication tools chat, voice and 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 WhatsApp to talk 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 communication platform to small enterprises, many of who may be using WhatsApp already.
Whilst Whatsapp has placed the service free, it may expand it to larger businesses with added features like analytics, in which it may well charge a usage fee at a later stage, therefore making a revenue model, segment watchers said. This actually also is aimed at increasing subscriber connect that it can leverage for future monetization of its other services. The larger agenda - and a more crucial one - for these companies is to get active users to invest far more time on the app or services as well as make it viable for profit generation, according to analysts.
"Every single technology company is competing for consumer stickiness, interaction and time spent on the app, and in order to keep them around the app's ecosystem they are widening themselves to turn into platforms. Merely being messaging apps that offer cost-free services won't be a good revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
