With recent acquisitions like Viber for $900 million and WhatsApp for a whopping $19 billion, it’s clear that there are both big dollars and big focus on messaging apps. But why so?
Their popularity, according to articles in VentureBeat and the New York Times, stems from the fact that messaging has become integral to phone usage. In fact, the volume of WhatsApp messages has even surpassed text messages. At 30 billion messages a day, it is 50% bigger than texting’s 20 billion messages a day.
And there seems to be something in messaging’s popularity for everyone. Publishers, game makers and e-commerce companies are using apps as a new distribution and money making platform, according to the New York Times article.
Developers work to expand the use of the apps, making new functionalities possible. And investors see huge potential and have driven the apps to ever-higher valuations.
As Fred Wilson, managing partner and Union Square Ventures and investor in the Kik messaging app told the New York Times, “Once they become full-blown ‘portals’ for mobile content and mobile commerce, we will really see how massive this opportunity is.”
Here are five tips to help you cash in on this ‘massive opportunity’ with your own messaging app:
Tip #1 – Make the most of app functionality
Apps have a unique opportunity compared to the desktop’s social-messaging counterparts. As Benedict Evans points out, smartphone apps can access a user’s address book and photo library, bypassing the need to rebuild social graphs or upload photos. They can also use push emails to get people to check in, rather than relying on users to go out of their way to check a website.
Tip #2 – Do more than one thing
As Evans says, people use several of these at once for different purposes. While WhatsApp may win ‘text chat’, Instagram has carved out its own niche. With the app KakaoTalk, people can discover and share other new smartphone apps. Users can send money to one another within Snapchat, and Line enables people to pay for things at brick-and-mortar retail stores.
Tip #3 – Build your network
According to VentureBeat, messaging is a utility that drives up the value of an app, but the network behind the app is just as important since the larger the network the more valuable the app is. And it’s not just about gaining users; it’s about keeping them.
Four weeks after user installation, Viber and Snapchat are able to retain at least 24% of their users, much higher than the communications category average of 1.84%. Network building requires creative thinking and possibly partnering.
Tip #4 – Find partners
In 2013, WeChat joined Chinese smartphone company Xiaomito to offer a limited quantity of the company’s newest phone for purchase on the chat app. Xiaomi reportedly sold 150,000 phones in less than 10 minutes. The WeChat app is known in China as a hub to find new mobile games with Tencent’s (maker of WeChat) mobile games revenue alone accounting for $420 million.
Tip #5 – Get ahead of the curve
Perhaps one of the most important tips is not to become complacent with the status quo. Many entrepreneurs see WeChat as the ideal model for building a business in messaging with its 500 million monthly active users using it to send image-laden messages, play games and even book car rides and plane tickets.
Media outlets like ESPN, Vice and CNN reportedly are expected to publish original content directly to a new editorial section in Snapchat.
“Media and communication are converging,” Jonah Peretti, chief executive of BuzzFeed, told the New York Times. “Some of what we’re all creating now will be a huge part of these messaging apps over the next one or two years.”
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