Just how Apps Like WhatsApp, WeChat Could Make Money Even while Providing Free Texting And Calling2890761

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Ever thought about how a messaging app could make money while giving free texting and calling? WhatsApp users in India might be surprised to discover that there are a lot more to messaging apps than communicating. Here is how: by providing services like digital payments, online shopping as well as content.

China's WeChat is among the perfect example of the huge potential which messaging apps hold. With over 900 million monthly active users, WeChat helps them do anything from messaging, buying grocery, hailing cabs, buying online food and even offline payments at restaurants - all of this without having to go to another app. These kinds of services not just offer the company outstanding customer stickiness, in addition they create a wonderful revenue model.

For now, WeChat's opponents outside China such as WhatsApp, Facebook Messenger, Skype, Viber and also Line are behind the curve on this front, although some have begun on the way to becoming larger platforms. "The reason chat apps are expanding beyond communications is to develop 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 simply a provider of communication tools chat, voice as well as video) to being a platform for the exchange of services, payment mechanisms and content consumption." WhatsApp, the biggest 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 are using WhatsApp to talk to businesses. make business messaging far more convenient for individuals and much more productive for businesses," a WhatsApp spokesman said in response to ET's questions. Whatsapp Business is a separate app from Whatsapp Messenger, aimed mainly at giving a direct communicating platform to small businesses, many of who might be using WhatsApp already.

While Whatsapp has placed the service free, it may broaden it to much larger businesses with added features like analytics, by which it could demand a usage fee at a later stage, hence making a revenue model, segment watchers said. This actually also is aimed at improving subscriber connect which it can make use of for future monetization of its other services. The bigger agenda - and a more important one - for these businesses is to get active users to spend more time on the app or services as well as make it viable for profit generation, according to analysts.

"Each technology company is vying for consumer stickiness, interaction and also time invested on the app, and in order to keep them in the app's ecosystem they're broadening 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.

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