The Way In Which Apps Like WhatsApp, WeChat May Make Money Even while Offering Free Texting And Calling6771112
Ever thought just how a messaging app could make money whilst giving free texting and calling? WhatsApp users in India might be surprised to know that there is more to messaging apps than communicating. Here is how: by providing services such as digital payments, online shopping and also content.
China's WeChat is one of the perfect example of the huge potential that messaging apps hold. With more than 900 million monthly active users, WeChat enables them to do almost everything from messaging, purchasing grocery, hailing cabs, purchasing online food as well as offline payments at restaurants - all this without having to go to another app. These kinds of services not only provide the company extraordinary customer stickiness, in addition they create a wonderful revenue model.
For now, 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 growing beyond communications is to create a sustainable 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 video) to becoming a platform for the exchange of services, payment mechanisms as well as content consumption." WhatsApp, the largest 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 know that people WhatsApp to talk to businesses. make business messaging far more convenient for people and more productive for businesses," a WhatsApp spokesperson 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 smaller 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 such as analytics, from which it may well charge a usage fee at a later stage, therefore making a revenue model, segment watchers said. This actually also is targeted at increasing subscriber connect which it can make use of for future monetization of its other services. The larger agenda - and a more important one - for these firms is to get active users to spend far more time on the app or services and make it viable for revenue generation, according to specialists.
"Every technology company is competing for consumer stickiness, interaction and also time spent on the app, and in order to keep them within the app's ecosystem they are widening themselves to become platforms. Just being messaging apps offering cost-free services isn't going to be a strong revenuegeneration model," said Jayanth Kolla, founding father of Bengaluru-based research firm Convergence Catalyst.
