The Way Apps Like WhatsApp, WeChat May Make Money Whilst Offering up Free Texting And Calling3483641
Ever wondered the way a messaging app can make money while offering free texting and calling? WhatsApp users within India might be surprised to learn that there is much more to messaging apps than communicating. Here's how: by offering services for example digital payments, online shopping as well as content.
China's WeChat is among the best example of the huge opportunity which messaging apps hold. With over 900 million monthly active users, WeChat helps them do almost everything from messaging, purchasing grocery, hailing cabs, purchasing online food as well as offline payments at restaurants - all this without needing to go to another app. These services not only offer the company outstanding customer stickiness, they also create a wonderful revenue model.
At the moment, WeChat's opponents outside China including WhatsApp, Facebook Messenger, Skype, Viber and Line are behind the curve on this front, although some have begun 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 away from being just a provider of communication tools chat, voice as well as video) to being a platform for the exchange of services, payment mechanisms as well as content consumption." WhatsApp, the biggest messaging app in the world with 1.3 billion every month active users, introduced a business version in India very early this week. "Based on research, we realize that people are using WhatsApp to speak with businesses. make business messaging less difficult for individuals and much more efficient for businesses," a WhatsApp representative said in respond to ET's questions. Whatsapp Business is a different app from Whatsapp Messenger, aimed largely at giving a direct communication platform to small businesses, many of who may be using WhatsApp already.
While Whatsapp has maintained the service free, it could extend it to much larger businesses with added features like analytics, by which it may well charge a usage fee at a later stage, hence making a revenue model, segment watchers said. This actually also is aimed at raising subscriber connect that it can make use of for future monetization of its other services. The bigger agenda - and a more crucial one - for these corporations is to get active users to take a lot more time on the app or services as well as make it viable for income generation, based on experts.
"Every technology company is competing for consumer stickiness, interaction and time invested on the app, and in order to keep them in the app's ecosystem they're widening themselves to turn into platforms. Simply being messaging apps offering free services certainly won't be a strong revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
