Facebook Is Finally Monetizing WhatsApp By Allowing Businesses To Communicate Directly With Users

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Facebook Inc (NASDAQ:FB) owned WhatsApp is reportedly set to introduce a number of features targeted at businesses and enterprises in a bid to take advantage of the massive user base of the popular messaging platform. This is a huge change in policy direction for the company and could have huge ramifications for both WhatsApp and its rivals.

WhatsApp is currently the largest chat platform in the world, with over 1 billion daily active users. However, despite its massive user base, WhatsApp has largely steered clear of large scale monetization, discounting the abandoned effort to charge users a small yearly fee. Now, its decision to allow businesses to directly interact with users could be a game changer. It could potentially lead to massive revenues and change the way how business is conducted across the globe. However, it could also backfire badly and damage WhatsApp’s popularity among users.

WhatsApp will now allow small to medium sized businesses to interact directly with their users. This will be done via the new WhatsApp Business app. The new tools will allow businesses to operate on the messaging platform itself. In order to ensure authenticity and fraud protection, verified businesses will feature a green badge next to their business name. A while back, we also reported on WhatsApp’s plans to integrate a digital payment service within its chat platform. In conjunction with WhatsApp’s new business oriented features, it is very easy to envision a future where a business transaction may occur entirely over WhatsApp. For example, you may place an order at a restaurant, then pay for it on the WhatsApp platform itself. You would also get delivery update notifications for your order via the app.

Of course, this new development has the potential to be extremely lucrative for WhatsApp. While the WhatsApp business app is free for now, COO Matt Idema has confirmed that they will charge for it in the future. Considering the sheer size and potential of the WhatsApp platform, it could soon become a major revenue generator for Facebook.

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However, this move may even backfire, if it is not implemented properly. Some time ago, we published an article analyzing WhatsApp’s immense success and the factors behind it. One of these factors was the lack of advertising, which has contributed to its immense popularity. In 2012, WhatsApp CEO Jean Koum even denounced the practice of in app advertising and criticized rivals who implemented it. However, that was before Facebook took over the company. If these new features are implemented in a way that allows for excessive spam and intrusion, annoyed customers could jump ship to one of the many other chat services nipping at WhatsApp’s heels.

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