WhatsApp is gearing up to finally monetize its messaging app by charging big enterprise industries for tools to better communicate with customers. WhatsApp will also offer a free app to small-to-medium sized business, though it hasn’t outlined the specific functionality of the app. The enterprise answer will allow global companies “to provide customers with useful notifications like flight days, delivery confirmations, and other updates”.
“We do intend on charging business in the future, ” WhatsApp’s Chief Operating Officer Matt Idema told the Wall Street Journal. “We don’t have the details of monetization figured out.”
The company did write that it wants to facilitate “someone placing an order with a local bakery or looking at new styles from a apparel store” and “shopkeepers who use WhatsApp to stay in touch with hundreds of clients from a single smartphone”, plus offer “an easier way is in response to messages.”
Perhaps WhatsApp could charge enterprises like “airlines, e-commerce sites, and banks” to have multiple representatives managing an account or sending high volumes of messages. It could also charge for artificial intelligence bot functionality or ecommerce transactions.
WhatsApp also officially announced its closed pilot program for substantiating business accounts with a green checkmark to distinguish them from personal accounts and fakes.
WhatsApp began testing verified accounts for businesses a week ago. Dialogues with business are encrypted and they can be blocked. Interestingly, if a business isn’t already in your phone number contacts, its name will appear as whatever they register themselves as instead of their number. This could allow WhatsApp to create a business search engine with optional sponsored outcomes, or let business cold-message people, possibly for a fee.
Alternatively, businesses on WhatsApp may need to be contacted by a user first before they can respond with organic or sponsored messages. That’s how Facebook Messenger works, and it’s led to businesses buying “tap-to-message” ads on Facebook’s News Feed to get people to initiate conversations so the business can follow up with sponsored messages. Not permitting cold-message ads meshes with WhatsApp writing that it plans to “make it easier for people to communicate with the businesses they want to reach on WhatsApp”, emphasis mine.
[ Update: WhatsApp now corroborates our hunch, telling TechCrunch “Businesses will only be able to contact people who have their phone number and agreed to be contacted by the business over WhatsApp.”
The company also says that the enterprise solution was originally be free but it does plan to charge businesses. Some functionality that will be offered by the Business app and enterprise solution includes the ability to create a substantiated profile with info like address, description, and hours, plus “Features for helping manage customer chats like away messages for when businesses are not able to respond at the moment.”]
When Facebook acquired WhatsApp for $19 billion in 2014, the companies said they wouldn’t set ads in WhatsApp because it would degrade the experience. But it also ditched its$ 1 annual subscription fee, leaving few monetization options beyond charging businesses for tools. The introduction of display ads and sponsored messages to Facebook Messenger may indicate a relaxation of WhatsApp’s stance against ads.
With over 1.3 billion monthly users and 1 billion daily users, WhatsApp has reached the massive scale necessary for it to earn significant revenue even from light ad. Its Snapchat Stories clone WhatsApp Status now has 250 million daily users, and could host vertical video ads between friends’ content the style Instagram does. It could also insert display ads into the inbox like Facebook Messenger.
After being one of tech’s biggest startup acquisitions, WhatsApp has tripled in sizing under comparatively hands-off management by Facebook. Now it’s time to earn its keep.
Note: Article updated to include a link to the Wall Street Journal narrative
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