The Way In Which Apps Like WhatsApp, WeChat Can Make Money While Offering up Free Texting And Calling146942
Ever wondered how a messaging app can make money while providing free texting and calling? WhatsApp users in India could be surprised to find out that there is far more to messaging apps than communicating. Here's how: by providing services for example digital payments, online shopping and content.
China's WeChat is among the perfect example of the great opportunity which messaging apps hold. With well over Nine hundred million monthly active users, WeChat helps them do anything from messaging, buying grocery, hailing cabs, buying online food and also offline payments at restaurants - this all without needing to go to another app. These kinds of services not just provide the company incredible customer stickiness, in addition they create a wonderful revenue model.
Right now, WeChat's competition outside China including WhatsApp, Facebook Messenger, Skype, Viber as well as Line are behind the curve on this front, even though some have started on the path to becoming larger platforms. "The actual reason chat apps are widening 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 from being merely a provider of communication tools chat, voice as well as video) to being a platform for the exchange of services, payment mechanisms and content consumption." WhatsApp, the largest messaging app in the world with 1.3 billion monthly active users, introduced a business version in India early this week. "Based on research, we know that people WhatsApp to speak to businesses. make business messaging far more convenient for individuals and more effective for businesses," a WhatsApp spokesman said in respond to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mainly at giving a direct communicating platform to smaller businesses, a lot of who may be using WhatsApp already.
Even while Whatsapp has kept the service free, it might broaden it to much larger businesses with added features for example analytics, from which it may well charge a usage fee at a later stage, hence creating a revenue model, segment watchers said. This also is aimed at improving subscriber connect which it can make use of 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 more time on the app or services and make it viable for profit generation, according to experts.
"Each technology company is vying for consumer stickiness, interaction as well as time spent on the app, and in order to keep them in the app's ecosystem they're broadening themselves to become platforms. Merely being messaging apps that provide cost-free services won't be a solid revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
