Facebook will remove the WhatsApp annual charge and introduce B2C features for brands to interact with their gigantic user base. This will make life more challenging for those service providers that have been exploiting loopholes and ambiguous terms & conditions to provide brands with communications channels to WhatsApp subscribers.
So now it’s official. The first significant news and updates from Facebook regarding the future of WhatsApp after the acquisition have been announced last week. WhatsApp will start removing its annual charge ($1 or local equivalent) across the different versions of its app. They also stress that in return for removing the annual charge there will be no introduction of 3rd party ads. Instead they open up their ecosystem and officially introduce business-to-consumer use cases.
That’s interesting news since it shows the basic direction where WhatsApp will be heading in the near to mid term future. It’s also interesting to see that Facebook’s native Messenger will not be the only platform opening up to B2C features; albeit Messenger clearly being the appointed service that is going to develop into that type of omnipresent commerce platform similar to those which have been pioneered and developed by the Asian players like Weixin/WeChat, LINE, Kakao, etc.
Don’t hassle a growth engine with monetization introduction
Coming back to WhatsApp, I am excited to see how that B2C ecosystem will develop. Right after the acquisition of WhatsApp it was hard to guess if there would be significant change to the very conservative and plain layout and feature set. Facebook strongly stressed “don’t worry about changes” back then, addressing significant concerns spreading in the community after the takeover announcement. It was smart not to touch anything since then. WhatsApp has been growing like crazy, keeping the momentum it had before the acquisition. Facebook let WhatsApp concentrate on growth without worrying too much about revenue. But now that they are nearing 1 billion monthly active users it would be negligent not to explore tangible ways to find the money.
A shadow system offering unofficial B2C access
There has been clear evidence that B2C is probably the most promising use case to tackle first and officially introduce a schema. A considerable “shadow system” has been growing in the last months where brands have been tinkering with letting consumers subscribe to their content and updates using WhatsApp. A whole bunch of service providers and intermediaries has emerged, helping brands overcome the situation where there where no official APIs for B2C communications in the service. In Germany e.g., this market has been dominated by players like Instanews, Whappodo, WhatsService and WhatsBroadcast. You can find similar providers in every market where WhatsApp has a significant market share in the messaging space.
Their solutions and implementations can be characterized by being clunky and unreliable, though. They have exploited a service made for consumer to consumer interaction and bent WhatsApp’s terms and conditions. As a result, brands have been suffering from lots of hassle in those cases where WhatsApp has blocked those phone numbers which have been used “commercially”, not to say for spam according to their t&c nomenclature. Sanctioning by blocking phone numbers means all subscribers hooked on to that number are lost and have to sign up again for that particular service (this usually affects 250-500 subscribers per number). Once this happens they need to be contacted by classic SMS to inform them and encourage to subscribe again by adding a different phone number to their contacts list.
B2C is a no-brainer: consumers and businesses don’t want to wait any longer
This has been by no means a suitable way of doing business and it’s a surprise to me how many well-know brands have been accepting to operate on top of this insufficient system. But, and that’s the learning: strong interest both on consumer as well as on business side is evident. Many users (consumers) have gotten accustomed to commercial content within WhatsApp and businesses and brands feel the strong appeal of a 1 billion user base. Their first steps using shady backchannels have been bumpy enough to convince them of chargeable B2C access and services. Thus it is a logical step to professionalize this ecosystem and open a very promising revenue stream for WhatsApp.
Those service providers which have closed the gap in the “unofficial” B2C services will have to adapt to the new situation and figure out what additional value they can still provide. As soon as WhatsApp will launch professional APIs and management tools to allow brands official exchange with their gigantic user base they will have a vital interest to harvest the biggest possible share of their business clients’ budgets.
Read on LinkedIn Pulse.
Read on Medium.