How Apps Like WhatsApp, WeChat Can Make Money While Providing Free Texting And Calling5289549

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Ever wondered the way a messaging app can make money while providing 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 and also content.

China's WeChat is probably the ultimate example of the great possibilities which messaging apps hold. With over 900 million monthly active users, WeChat helps them do everything from messaging, buying grocery, hailing cabs, purchasing online food and even offline payments at restaurants - all this without needing to go to another app. These services not just offer the company unbelievable customer stickiness, they also create a wonderful revenue model.

For now, WeChat's rivals outside China such as WhatsApp, Facebook Messenger, Skype, Viber and also Line are behind the curve on this front, although some have started on the road to becoming bigger 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 away from being simply 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 largest messaging app on earth with 1.3 billion monthly active users, introduced a business version in India early this week. "Based on research, we all know that people are using WhatsApp to speak to businesses. make business messaging more convenient for individuals and much more productive for businesses," a WhatsApp representative said in respond to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mainly at giving a direct communication platform to smaller businesses, many of who may be using WhatsApp already.

Whilst Whatsapp has placed the service free, it may extend it to much larger businesses with added features like analytics, by which it could demand a usage fee at a later stage, thus making a revenue model, segment watchers said. This actually also is geared at raising subscriber connect that it can make use of for future monetization of its other services. The greater agenda - and a more important one - for these firms is to get active users to spend much more time on the app or services and make it viable for profit generation, according to experts.

"Every single 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 are broadening themselves to become platforms. Simply being messaging applications that offer free services is not going to be a solid revenuegeneration model," said Jayanth Kolla, founder of Bengaluru-based research firm Convergence Catalyst.

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