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Is WhatsApp about to let businesses in on the conversation?

  • Clock logoJune 19, 2017
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WhatsApp, the Facebook owned messaging service that boasts over 1 billion users worldwide, is currently conducting field tests for a business chat model that opens a communication line between brands and their customers.

If WhatsApp managed to escape a user exodus after its purchase by Facebook in 2014, this next development may be the clincher… Or not, as explained by Élise Chen, Strategic planner for The Social Client, digital consulting agency and a company within Acticall Sitel Group, who shares her insights on this strategic move.

A different model…

Since February, WhatsApp has been experimenting with a handful of young startups from the Y Combinator program, in order to test a new tool that allows brands to contact WhatsApp users directly. Messaging service turned business opportunity? The shift has been eagerly anticipated by brands and even users, namely in remote areas where WhatsApp is hugely popular and connectivity is often weak.

The rumor had been circulating since early 2016 that Facebook was planning to bring WhatsApp users closer to their favorite brands, with an aim to develop an application that would let you, among other things, communicate directly with your bank should a fraudulent transaction occur or an airline if a plane is delayed.

… for different users?

Having built its reputation on a minimalist, ad and spam free communication stream, and eliminated its 1$ subscription fee since it was sold to Facebook, WhatsApp seems to have adopted a new outlook by exploring a revenue generating alternative that charges brands who wish to contact its 1,2 billion users (Discover our White paper "Messenger, the Customer relationship channel"). If Messenger has for some time embraced this approach, WhatsApp remained reluctant to follow suit, keen to respect its original promise, long advocated by founder Jan Koum, to provide an unadulterated “no adds, no spam, no gimmicks” service to its users.

Today, WhatsApp is running surveys to determine how often its users chat with brands and whether or not they consider the exchange intrusive or find themselves annoyed with spam. “We want to explore ways for you to communicate with businesses that matter to you too, while still giving you an experience without third-party banner ads and spam." a WhatsApp spokesman explained.

“Unlike its strategy with Messenger, Facebook has until now ‘protected’ WhatsApp since acquiring it. Traditionally, its users have not been the same as those on Messenger, and Mark Zuckerberg has held back from deploying a business tool to preserve its original presentation and mechanism that made it especially valuable to the first generation of users.” underlines Élise Chen.

“But the mindsets have changed” continues Chen, “and today’s WhatsApp users have different expectations than those from 8 years ago. They’re much more willing to accept interactions with brands and businesses within their messaging channels and even see this as a natural extension of our social behaviors. The rise of social business, proven yet again just a few months ago with the integration of Transferwise into Messenger allowing money transfers through a bot, compels WhatsApp to move in this same direction.“

Different market opportunities

The service is highly anticipated, particularly in South America, Europe (with the exception of France who favors Messenger), India, Pakistan and Russia where WhatsApp is more popular than Messenger.

Cowlar, a Pakistani startup that recently joined Y Combinator, builds connected collars for dairy cows that track their activities and inform farmers of their whereabouts and wellbeing, so that they can be coached into improving their milk production. Trial collars are currently being tested in the United States, and Cowlar wants to use WhatsApp to send automatic messages to farmers to signal any abnormality detected in their cows’ activities or behaviors.

WhatsApp is also developing a new messaging service, “WhatsApp for Business”, intended for small businesses of less than 10 employees. It’s already being tested in India who announced on April 4th the launch within six months of a peer-to-peer payment system backed by UPI (unified payment interface).

“Chat and Pay is inescapable. The question now is whether WhatsApp will open APIs to build bots and integrate payment options. Brands are soon going to demand more than a simple communication tool. They’ll want structured messages, bots that can answer questions, analytics, targeted ads… which all already exist on Messenger and WeChat. So it’s just a question of time for WhatsApp…” muses Élise Chen.

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