At one point in the past, messaging app Whatsapp seemed interested in monetizing its app with an annual subscription, but after being acquired by Facebook, the app made it clear it wouldn’t be using ads or any other source of revenue within the app, thereby locking users to a free platform for a longer time.
At some point though, like many other startups, Whatsapp would have anticipated a user saturation stage, at which a monetization strategy would kick in – LinkedIn did it with its Pro version, and Instagram (another Facebook owned property) has introduced ads. Crossing 1 billion DAUs recently has prompted Whatsapp to jumpstart its revenue generation plan.
Yesterday, Whatsapp announced a slight shift from its ‘free-to-use’ model with a new way to generate revenue as it plans to charge large businesses by providing new tools and features that will improve the communication with their customers. The Whatsapp Enterprise Solution is targeted at large businesses, with an additional layer / channel of communication.
For Whatsapp, the approach is simple. They want people to connect with businesses in the same way they connect with each other on the social messaging app. The company in its blog post wrote, “Our approach is simple – we want to apply what we’ve learned helping people connect with each other to helping people connect with businesses that are important to them.”
Whatsapp won’t be catering to big businesses only as it will also offer a free business app for small and medium sized businesses. These small businesses will benefit from enhanced feature-set, allowing faster 2-way communication with customers through a single smartphone. A lot of small businesses like bakeries, designers, jewelers have already been using Whatsapp to take orders or show pictures of their products to customers, but due to group size limitations, they cannot reach all customers at all times. Hopefully the Enterprise version will help overcome some of these current limitations.
Whatsapp used to support 100 members in a group but the company updated its app as 256 members can now be added to a single group. But keeping in mind that the messaging app wants to cater to big businesses, Whatsapp will need to further increase the limit of group members as businesses will probably want more than 1,000 members in a single group to cater to the big market.
By using such groups, businesses will be able to address all its customers through a single message by providing them with quick updates of their products and services. While these groups will be helpful for all the customers, it can be a nuisance if such groups are used for customer services and support system as all the people will be constantly bombarded with complaint messages that may not be related to them.
Specific details have not yet been given by the messaging company on features, pricing and rollout strategy. Whatsapp Chief Operating Officer, Idema, said that they had not yet figured out a way to monetize currently, but they did plan to charge businesses in the future.
This is not the first time that Whatsapp has made a move towards businesses. Last month the messaging app started testing out verified business accounts on its platform. Verified accounts will have a green tick next to them, similar to the blue ticks on Twitter, Facebook and more recently on Instagram as well. Giving more importance to businesses is surely a good step by Whatsapp as this was the one area that it had not properly targeted as a viable customer segment.
It needs to be seen how Whatsapp will be catering to the needs of business through its platform and will it be monetizing its app. For updates on this, subscribe to our Facebook page.