What’s Up With WhatsApp? In-App Ads Are Coming
WhatsApp is the world’s most popular messaging service, with a global audience of around 1.5 billion users. In South Africa, it has recently overtaken Facebook as the most popular messaging app for smartphones, and is used by roughly half the population. One of the main reasons why we love WhatsApp so much is because it’s so cheap – FREE, in fact, if you have access to WiFi. Even when using mobile data, it still gives us a way to text, call, send photos and share other media at significantly cheaper rates than the standard SMS or call rates offered by our mobile phone service providers.
WhatsApp was started in 2009 by two former Yahoo employees, Jan Koum and Brian Acton, who, ironically as it turned out, couldn’t get jobs at Facebook. Built using seed money of just $250 000, WhatsApp was founded on the promise of privacy and, more importantly, no advertising.
“No one wakes up excited to see more advertising, no one goes to sleep thinking about the ads they'll see tomorrow,” Jan Koum once said in a blog post. “We know people go to sleep excited about who they chatted with that day (and disappointed about who they didn't). We want WhatsApp to be the product that keeps you awake... and that you reach for in the morning. No one jumps up from a nap and runs to see an advertisement.”
Co-founder Acton was also quoted as saying, “We don't want to inundate users with messages they don't want.”
But, when WhatsApp was sold to Facebook in 2014 for a jaw-dropping $19 billion, savvy marketers speculated that the day would come when the world’s largest social media platform would look to monetise its new toy and earn back some of its sizeable investment. After all, selling ads targeted with user data is Facebook’s bread and butter, accounting for almost all of its $41bn in revenue in 2017.
And now it seems the predictions made almost five years ago are about to come true.
Will WhatsApp Become WhatsAd?
Following Koum’s departure from WhatsApp in May 2018, (Acton had left the year before) speculation became rife about what possible role advertising would play in the platform’s future.
David Marcus, Facebook’s Vice President of messaging products, fuelled this speculation when he said in an interview with US news network CNBC: “As far as advertising is concerned, we're definitely getting WhatsApp more open. We're now going to have the ability to enable larger companies, not only small businesses, to integrate a new API (application programming interface) to send and receive messages with people on the WhatsApp platform.”
WhatsApp vice president Chris Daniels confirmed this at the beginning of November 2018, saying that WhatsApp will start showing ads to users in the app’s Status feature in 2019, pulling data from social media, conversations, uploads, sentiments, and location choices.
So, What Does This Mean?
Although allowing advertising on WhatsApp may violate its original ethos, there’s no denying that its 1.5 billion users present a significant opportunity for brands to have authentic and personal conversations with their customers.
And, as former Facebook Security Chief Alex Stamos said in a recent Tweet, “It is foolish to expect that FB shareholders are going to subsidise a free text/voice/video global communications network forever. Eventually, WhatsApp is going to need to generate revenue.”
Be that as it may, there is concern that the app’s end-to-end encryption feature – which allows for absolute privacy of all messages exchanged between users – may be compromised by the introduction of targeted advertising. Facebook has, however, gone to great pains to reassure users that messages will remain encrypted and that “there are no plans to change that.”
So, what does all this mean for brands keen to take advantage of what looks to be an incredible advertising opportunity? Industry experts across the globe have all weighed in with advice to prospective advertisers – here are the key take-outs:
• Use timely, relevant and personalised content.
• Ads should feel like you’re chatting to a colleague or friend.
• Strike a delicate balance – don’t make users feel contaminated or invaded.
• Made ads personally cued, AI-driven and highly interactive.
• Test campaigns, and refine them once you have a better understanding of how advertising in the messaging platform works.
There’s no denying that social media platforms are starting to feel more than a little cluttered, with tens of thousands of brands vying for that all-important audience engagement. For marketers who get in early, WhatsApp might just offer a much-needed new ad territory in which to stake their claim.