Social networks 2.0: The rise of the messaging app

Free chat and messaging apps have changed my life. These handy, mostly free apps have made it so much easier to keep in touch with loved ones and manage work related issues with minimum fuss that I’m at a loss to remember how we managed before they came onto the scene.

While I love WhatsApp for its ease of use and clean interface, there are many services gaining ground in Asia, establishing a solid presence, and growing user numbers here. The biggest are of course Line, WeChat, and Viber. Other smaller apps like Kakao Talk in South Korea, for example, have also squeezed into local markets. And then there are players like Snapchat, with its completely unique value proposition, that have taken the world by storm, breaking the barriers of both usage and audience engagement.

The success of each of these services can be determined by a number of factors, and that’s probably a story for another day. What’s clear, however, is that these apps have given birth to a new kind of social network—one that is mobile first. With mobile gaming, shopping and myriad other services, these apps are creating a new mobile ecosystem around their consumers. Unlike Facebook, Twitter and other traditional social networks, these apps were developed for mobile, are always ‘switched on’, and are being used to carry out important day-to-day activities.

As the social media space becomes more fragmented, these apps are sure to continue to gain traction not only in Asia but all over the world. That’s because they’re driving users to go back to the basics of social networking: making connections with other people. They are the new social networks, and are bringing us into a new era, one where online social connections are even more personal and impactful.

As a recent IPG Media Lab Whitepaper pointed out, the key difference between a messaging app and a social network lies in the number of people they reach, and the intent of the communication. While information shared through a messaging app is meant to be more or less private and shared with a limited number of people, the opposite is true on a social network. A piece of content shared on a social network is used to establish a ‘one-to-many’ connection.

However, these lines of difference are starting to blur. Many messaging apps now offer features where public sharing of content is possible. China’s WeChat is a prime example of a messaging service that has morphed into a social network by providing new and creative features to consumers.

Staying relevant now means giving customers the functionality they desire, and the space to customize their own experiences within the platform. Messaging app users are protective of their privacy and don’t look favorably upon advertising, so monetizing these apps means developing products and add-on services that consumers would be willing to pay for. Line has had great success with this and is known to generate over $10 million in revenue from its virtual stickers alone.

2014 was a big year for consolidation in the chat and instant messaging app space, with Rakuten snapping up Viber and Facebook adding WhatsApp to its burgeoning portfolio. For platforms that have only been operational for an average of four to five years, the numbers are impressive. WeChat has over 680 million registered accounts, while Viber has about 280 million users registered globally.

Access to a user base of this size is critical to the success of any internet-based business, and Facebook’s $19 billion acquisition of WhatsApp (which has 450 million active users) in February 2014 is proof that companies are willing to shell out big bucks for this privilege.

The numbers, analyst reports, and predictions clearly show that the world of messaging services is lucrative. While one would imagine that the market is quite saturated, these messaging services look like they’re going to continue to grow by leaps and bounds in the year to come. While they may not completely replace social networks, messaging apps will become just as important, all the while encroaching on the position currently occupied by traditional social-media networks. Be sure to keep a close eye on them.