How Apps Like WhatsApp, WeChat May Make Money While Offering Free Texting And Calling3311216
Ever thought how a messaging app could make money while providing free texting and calling? WhatsApp users at India could be surprised to know that there's a lot more to messaging apps than communicating. Here is how: by offering services such as digital payments, online shopping and also content.
China's WeChat is probably the ultimate example of the vast opportunity that messaging apps hold. With over 900 million monthly active users, WeChat enables them to do every thing from messaging, buying grocery, hailing cabs, ordering online food and even offline payments at restaurants - all this without having to go to another app. These services not merely offer the company incredible customer stickiness, they also create a outstanding revenue model.
For now, WeChat's rivals outside China this includes 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 reason chat apps are widening beyond communications is to create 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 just a provider of communication tools chat, voice as well as video) to becoming a platform for the exchange of services, payment mechanisms and also content consumption." WhatsApp, the biggest messaging app on earth with 1.3 billion every month active users, introduced a business version in India early on this week. "Based on research, we realize that people are using WhatsApp to talk to businesses. make business messaging far more convenient for individuals and much more effective for businesses," a WhatsApp spokesperson said in respond to ET's questions. Whatsapp Business is a different app from Whatsapp Messenger, aimed mainly at giving a direct communicating platform to small enterprises, many of who might be using WhatsApp already.
Whilst Whatsapp has placed the service free, it could extend it to larger businesses with added features such as analytics, by which it may well charge a usage fee at a later stage, as a result developing a revenue model, segment watchers said. This also is targeted at improving subscriber connect which it can leverage for future monetization of its other services. The bigger agenda - and a more crucial one - for these companies is to get active users to invest far more time on the app or services and also make it viable for income generation, according to specialists.
"Every technology company is competing for consumer stickiness, interaction as well as time spent on the app, and in order to keep them in the app's ecosystem they are widening themselves to turn into platforms. Simply being messaging apps that provide free services will not be a solid revenuegeneration model," said Jayanth Kolla, founding father of Bengaluru-based research firm Convergence Catalyst.
