I’m using Whatsapp for 2 years and one month ago a question has arrived in my mind that How does Whatsapp Make Money. WhatsApp provides us free chatting, and audio, video calling etc. So why WhatsApp is providing everything for free. Why Facebook bought WhatsApp for $19 Billion. Because of this, I started to discover how WhatsApp earns money. In result, I found that they work on behavioral marketing instead of selling or ad showing.
Similar tactics are used on Facebook. Facebook is free. Facebook also work on behavioral marketing but Facebook shows ads as well.
So Let start to reveal How does Whatsapp Make Money
Note: This is my Personal research and opinion.
Before I start to reveal my research I think first you need to understand What is behavioral marketing?
What is Behavioral marketing?
I will teach you by an example.
Let suppose a car company publishes a holding ad on a roadside. There are thousands of people who saw this ad suppose one thousand people saw this car ads in which only one hundred people interested in car ads and other nine hundred people are not interested in car ads because most of them have already cars, some are not able to buy a car and few are housewife and few are kids.
So companies fail to get more customers in this way. But this is the 21st century. Here companies target and invest in very specific and interested people and get a great result.
So basically they work on the behavior of net users and this process is called behavioral marketing.
WhatsApp and Facebook are those platforms who help to know people behaviors. Because they have millions of users that’s why Facebook bought WhatsApp and one user of WhatsApp sold more than $40. Now WhatsApp start sharing their user data. Let come to the topic. I have a case study to show you.
Behavioral Marketing Case Study
One month ago I was posted a status on a Blogging group “Bloggers Funda”. The status is about Best and cheap Hosting for my WordPress. You can check in below screenshot.
And then facebook understand that I want to host my WordPress site and they send my behavior to Google Adsense. In result whenever I go to visit any site they always showing me hosting related ads even I saw hosting ads on youtube ads. Amazingly I have some screenshots to show you.
Hosting ads on a video on Youtube.
Namecheap ad on Side Bar.
Another NameCheap Hosting ad on a website.
Another Hosting ad.
I hope I’m successful to teach you what is behavioral marketing?
As far as we talk about How does Whatsapp Make Money? They earn money by sharing their user’s data (behavior) to advertising companies.
How Does WhatsApp Make Money?
So same like Facebook, WhatsApp make money through behavioral marketing and as you know WhatsApp has “no ads policy” that means WhatsApp are not showing ads to their users then how they earn money while it’s also free.
WhatsApp was available in the paid version before Facebook bought it. That means on that time WhatsApp earn money by selling membership but when Facebook bought WhatsApp then they announced WhatsApp free for every user and as I already mentioned that Facebook bought WhatsApp for $19 Billion.
So Facebook is in deficit. No, rather they are an advantage. Because Facebook has millions of users and WhatsApp has also millions of users and when we talk about both it will become billions of users. By having both platform users behavior Facebook show more relevant ads.
How does Instagram Make Money?
Similar tactics are using with Instagram. I’ll explain you by an example. Once I go to a store and spend 10-15 minute approximately. I did not like anything that’s why I came back home without buying anything. But next day I saw an ad for that company on my Instagram timeline and seriously I wondered how this was done. I think maybe my phone’s location was on. Maybe Facebook has access to my phone location and they know where I visited last day and then they show me the same brand ad on my Instagram timeline.
We will also talk a little bit about the Retargeting which is used by Google Adsense.
Retargeting is so similar process with Behavioral marketing. Whenever you search on google for anything in result Google Adsense show you ads which is related that you searched for.
If once you join any social media like WhatsApp and Facebook then forget about your privacy because once you uploaded your information on any social media than having forgotten but they remember. They know so much about you that you can never even imagine. They know where you live, what is your status, what you like and share, even they know who you’re chatting with.
That’s why Facebook always show your related ads on your timeline. So 80% of this is the chance that you will click on the ads. Only Facebook knows how to target their customers in this way. Due to it their revenue increases every year. Because Facebook has world biggest database and they became a superpower after met with WhatsApp.
But we don’t need to care about it because there are many features that we are using only on Facebook without spending even a penny. Okay, we’re watching advertisements but they are related to our concern.
If you are thinking that Facebook and WhatsApp do not have any products to sell. So, how do they make money?
So the answer to that question is you and millions of users like you are the product of Facebook and WhatsApp. If we talk about how much they earn from each user than they earn approx. $10 to $12 from each user annually. This means that you’re paying $10 to $12 annually to the fees.
So this is how does WhatsApp make money. WhatsApp basically helping to Facebook for getting more information about users. Instagram is also doing same work like WhatsApp.
I hope you like this article if you have more suggestions about how does WhatsApp make money and Behavioral marketing so please feel free comment on bellow section.