Any business in the world invests in something to get a return out of it right? Then How Does WhatsApp Make Money without selling advertisements or receiving subscription charges to use their App?
This question may raise in many people including me till I figured out the answer. If you are thinking they are serving the platform free, then you are wrong. Today I will let you know the in-depth answer on how WhatsApp earns and what are their business strategies.
You may know it’s a Facebook-owned company but do you know the past history of WhatsApp, Who was the owner? When did they start? How did it become popular?
Table of Contents
- 1 So, let us go back to the past before WhatsApp was purchased by Facebook
- 2 When Did Facebook Acquired Whatsapp?
- 3 Why did Facebook buy WhatsApp?
- 4 In simple terms “Whatsapp built a huge userbase, made users engage every day, then started pitching businesses to earn money by creating value and trust.”
- 5 Is There Future Scope For WhatsApp To Grow Further?
- 6 Conclusion
So, let us go back to the past before WhatsApp was purchased by Facebook
You may not know that it had a subscription model in the initial days where 1$ for downloading the app, first it was free and subsequent years users had to pay 1$ per year.
When Did Facebook Acquired Whatsapp?
In 2014, Facebook acquired WhatsApp for 19 Billion dollars in the form of cash and shares. From then Whatsapp became even more popular by providing a free platform to chat without even paying 1$ annually.
Why did Facebook buy WhatsApp?
When Facebook has so many users but still why did Facebook buy Whatsapp? This question you may get, don’t worry I will answer. In this world, data has become a big player for businesses, whether a person uses Facebook or not but he will be at least using Whatsapp, now after the acquisition, both Facebook and Whatsapp data are in the hands of Facebook Company.
A lot of people started complaining that Facebook tracks the behavior of WhatsApp users and using the data for the target audience in Facebook Ads. So Facebook cleared that by saying they are not collecting any such kind of data and implement changes in the policies. hmm… then how Facebook makes money without ads is it a loss for Facebook buying Whatsapp? No, wait!
Instead of showing Ads, they released another version of WhatsApp that is WhatsApp business, where more features added other than normal Whatsapp which is time-saving for businesses like auto-reply, etc. For the premium version of WhatsApp user has to pay to use.
In simple terms “Whatsapp built a huge userbase, made users engage every day, then started pitching businesses to earn money by creating value and trust.”
This was just one source of income, apart from this, there is another method which was introduced as beta testing i.e. “WhatsApp Pay” launched in February 2018. Payments via WhatsApp have been presented to one million users through a partnership with ICICI Bank. On February 7, 2020, the messaging app received approval from NPCI to roll out its digital payment service gradually.
Is There Future Scope For WhatsApp To Grow Further?
Yes 100%, Recently there was a news Reliance Gio and Whatsapp tied-up to make business, where Jio Mart e-commerce will be pushed to the market through WhatsApp. No one has thought this type of business but the technology can make anything possible. From this, both companies earn huge profits in the future.
Any platform where more people are engaging, there will be money. It is just like a market place when more people comes more sales and money can be generated. Whatsapp has built the trust factor and created value for the people now moving towards money-making as well as trying to provide more and more services.