Asian mobile messaging app developers have expanded their service beyond providing social messaging to sell virtual items and allow third-party developers access to their platform as part of their monetization strategy, shares two regional players.
For South Korea-made social messaging app, KakaoTalk, opening its platform to third-party partners is key in its growth strategy, said Kate Sohn, vice president of global business development at Kakao. Describing the company as a "smart connector", she said KakaoTalk connects third-party partners to users to create profit together.
Sohn noted that KakaoTalk app sells digital items such as emoticons or themes with more than 98 percent of the content developed by third-party design shops which share revenue with Kakao. The platform has 66 million registered users worldwide as of November 2012, among which 55 million are in Asia with Korea being its largest market, she noted.
WeChat, a mobile messaging platform developed by Chinese Internet giant Tencent, is doing something similar. Louis Song, WeChat's country manager for Malaysia and Singapore, said any third-party app can be integrated in the app using its open API.
"WeChat does not directly sell its own stickers or emoticons like other messaging apps. Instead, it allows developers to have fun with their creations and emoticons using the WeChat platform and sell it to our 200 million WeChat users," said Song. While he did not share the breakdown of Asian user, Song said the app has been on top rankings in Apple App Store and Google Play in many countries in Southeast Asia.
Integrating m-commerce into app
WeChat's parent company plans to integrate its third-party payment platform, TenPay, into WeChat, Song said the app does not have a definite monetization model to date and is not under any monetization pressure from the parent company.
However, he hinted that e-commerce was "indeed a very important part for the development of WeChat" and the integration of TenPay will happen "in the near future".
For KakaoTalk, mobile commerce is already in business. Sohn said users can send mobile coupons as gifts to their friends. Kakao then takes a small cut from the transactional revenue, she said.
The South Korean company introduced Kakao Game in July 2012 which generated US$51 million in revenue from the first three months, Sohn added. The company connects mobile games with Kakao Game API to allow users to play games with their KakaoTalk friends.
Opening up the API, is also a strategy pursued by mobile messaging app Nimbuzz which has a global headquarter in India, and has more than 100 million users spread across 200 countries with about 60 percent of users in Asia.
According to CEO Vikas Saxena, the company's monetization strategy also involved big data.
"With more than 100 million users very actively engaging on the platform, Nimbuzz has unique insights into user behavior, patterns on handheld devices on a global scale," he said.
With the information, Nimbuzz is able to bring targeted mobile advertising tools for partners such as hyper-local ads, he said. He added that the platform has a virtual currency which users can purchase avatars and virtual gifts with.
Beside messaging, Nimbuzz also has an international calling service which allows users to make inexpensive international calls to friends on mobile phones or fixed-line services, he added.
First mover advantage
While mobile messaging app providers are monetizing their services through virtual items, some users prefer to use the platforms without paying extra charges.
Singapore-based writer Jacky Yap, who is an avid user of Whatsapp, Line and Cubie, said he has only paid for Whatsapp when he first bought a smartphone. "For now, I'm not willing to pay for anything because there are just too many free options," he added.
Yap said he finds that Asian mobile messaging apps tend to include visual items, such as stickers and emoticon. He added he had many female friends who were using Line which has a "cutesy feeling".
"Perhaps stickers and emoticons works really well in the Asian culture especially for female users," Yap said.
He uses Whatsapp with both acquaintances and friends because many of them are on the platform. "Whatsapp has totally nailed the group messaging function. The user interface is straightforward," he added.