WhatsApp is ultimately set to use its Status feature as an ad-serving model next year.
WhatsApp Status, the simple way to show what you're doing in the form of multiple photos or a short video, will ultimately become a source of revenue for Facebook. The Menlo Park, California-based company is reportedly all set to start serving ads on WhatsApp Status next year. This isn't something fresh for the parent social networking company, which saw massive criticism over a data abuse by UK-based Cambridge Analytica earlier this year. Facebook brought a similar ad-serving model on Instagram Stories in June. The company also launched a dedicated WhatsApp Business app back in January with a view to bringing small businesses on board.
Wall Street Journal reports, citing WhatsApp officials, that WhatsApp Status will start showing ads next year. The ads will be powered by Facebook's native advertising system and will "help familiarise users with business" on WhatsApp. Facebook is using the ads in Instagram Stories as a model to serve ads through WhatsApp Status. "We've seen it working well on Instagram and so we're learning a lot from that," said Matt Idema, WhatsApp's Chief Operating Officer, as quoted by Wall Street Journal.
Serving ads through WhatsApp Status makes sense for Facebook as the feature hit the benchmark 450 million, as highlighted by CEO Mark Zuckerberg at the F8 developer conference in May. Unlike a regular chat, WhatsApp Status allows users to share multiple photos or a short video that stay in a separate section on the app for 24 hours. Facebook also offers an option to let users see how many of their contacts have seen their status. This is something that could give advertisers a way to keep track of their ads as well.
WhatsApp Status, launched in February last year, is inspired by Snapchat Stories. However, Snapchat is far behind WhatsApp when it comes to user base, counting just 191 million daily active users (as of May this year) - something very important to persuade advertisers.
In addition to using WhatsApp Status as a revenue source, Facebook will largely use WhatsApp Business as a major revenue-driven model. Wall Street Journal reports that the company will bring new ad types to let users know they can text companies directly via WhatsApp for any customer-service queries. The report adds that the company will charge between a half a penny and 9 cents (roughly 34 paise to Rs. 6.2) - depending on the country - for every message delivered to a WhatsApp user.
Nearly 100 companies are already said to be testing the ad-focused feature, including Uber and Singapore Airlines. The WhatsApp Business app, which is available on both Android and iOS platforms for small and medium enterprises (SMEs), has over three million users. Companies such as Netflix and BookMyShow were among the initial test partners for the WhatsApp for Business initiative that debuted in India in September last year, before WhatsApp also attracted SMEs with the WhatsApp Business app.
Wall Street Journal notes that while the messages between people and business will be encrypted and unreadable by WhatsApp, the companies could "potentially store" those messages in a "decrypted state". This means a "pool of potentially useful data" will be available for clients that could help retaining advertisers.
The overall revenue growth of Facebook is declining, though its user base reached 2.23 billion monthly active users in the second quarter. The Zuckerberg-led company even warned that it expects a deceleration in its revenue growth in the next couple of quarters as it is promoting new and some less profitable products.
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