The Way Apps Like WhatsApp, WeChat Helps Make Money While Offering up Free Texting And Calling

Ever thought just how a messaging app could make money whilst offering free texting and calling? WhatsApp users in India might be surprised to learn that there are a lot more to messaging apps than communicating. Here is how: by offering services for example digital payments, online shopping and content.
China's WeChat is among the perfect example of the large opportunity that messaging apps hold. With well over 900 million monthly active users, WeChat helps them do everything from messaging, purchasing grocery, hailing cabs, ordering online food as well as offline payments at restaurants - all this without needing to go to another app. These types of services not merely provide the company unbelievable customer stickiness, in addition they create a exceptional revenue model.


For now, WeChat's competition outside China this includes WhatsApp, Facebook Messenger, Skype, Viber and also 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 growing 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 and also video) to being a platform for the exchange of services, payment mechanisms and also content consumption."
WhatsApp, the biggest messaging app in the world with 1.3 billion monthly active users, introduced a business version in India early on this week. "Based on research, we know 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 response to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mainly at giving a direct communication platform to smaller businesses, the majority of who may be using WhatsApp already.

Whilst Whatsapp has placed the service free, it could broaden it to much larger businesses with added features such as analytics, from which it could demand a usage fee at a later stage, thus developing a revenue model, segment watchers said. This also is targeted at increasing subscriber connect which it can make use of for future monetization of its other services. The greater agenda - and a more crucial one - for these corporations is to get active users to invest more time on the app or services as well as make it viable for profit generation, according to specialists.
"Every technology company is competing for consumer stickiness, interaction along with time invested on the app, and in order to keep them around the app's ecosystem they're widening themselves to become platforms. Just being messaging Apps Like offering cost-free services won't be a solid revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.
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