Jules Boutsen XMM101A
Why Mark Zuckerberg is talking so much
about Meta’s WhatsApp for business?
Article by: Cheryl Winokur Munk
Learn more about the future of WhatsApp.
Jules Boutsen XMM101A
Why Mark Zuckerberg is talking
so much about Meta’s WhatsApp
for business?
Cheryl Winokur Munk
In this article the author talks about why Mark Zuckerberg wants to optimize WhatsApp for business.
Facebook's new rebrand logo Meta is seen on smartphones everywhere. The new Meta and
metaverse that Mark is creating consists mainly Facebook, Messenger, Instagram, WhatsApp, and
Oculus. But WhatsApp why is Mark Zuckerberg talking so much about WhatsApp lately?
WhatsApp is already widely popular with U.S. consumers. These initiatives offer Meta the ability to
boost advertising revenue, stay relevant with small businesses and gain incremental revenue from
the premium services offered, analysts said. Since then, industry watchers have been watching
closely for signs the company plans to monetize the platform more. The company recently reported
an earnings and revenue miss and forecast a second straight quarter of declining sales. But with his
commitment to the metaverse as far as a decade out before it comes out, the Meta CEO has stressed
that in the short-term it is WhatsApp that is among the initiatives to focus on for growth. Because
WhatsApp is very useful for communication between businesses and costumer.
In conclusion, Mark and his team are trying to optimize all their Meta applications. And they want to
use WhatsApp as a middle way to communicate with customers that clicked on an advertisement in
the metaverse or in their other applications.
Jules Boutsen XMM101A
Why Mark Zuckerberg
is talking so much
about Meta’s Whatsapp
for business
P UBL I S HE D S UN, AUG 7 20229:00 AM EDTUPDATED MON, AUG 8 20227:27 AM EDT
Cheryl Winokur Munk @ C H E R Y L M U N K
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KEY POINTS
WhatsApp Business launched in 2018 with free, simple tools to help small businesses
keep in touch with customers.
Now Mark Zuckerberg is betting it will be the next big driver of monetization for Meta.
Following Facebook and Instagram, “WhatsApp is really going to be the next chapter,
with business messaging and commerce being a big thing there,” he recently told
CNBC.
Jules Boutsen XMM101A
Facebook’s new rebrand logo Meta is seen on smartpone in front of displayed logo of Facebook,
Messenger, Intagram, Whatsapp and Oculus in this illustration picture taken October 28, 2021.
Dado Ruvic | Reuters
WhatsApp is already widely popular with U.S. consumers. Now Meta
Platforms is turning more attention to building its small business base.
The Facebook parent company launched WhatsApp Business in 2018 with
free, simple tools to help small businesses keep in touch with customers,
offering a way for them to directly interact, search for products and indicate
purchasing interest.
Soon the company will roll out a premium service to small businesses, and
it’s doubling down on a newer advertising format called “click-to-message,”
which allows consumers to click on a company’s ad within Facebook or
Instagram and directly start a conversation with that business on
Messenger, Instagram or WhatsApp.
These initiatives offer Meta the ability to boost advertising revenue, stay
relevant with small businesses and gain incremental revenue from the
premium services offered, analysts said.
Keeping more inside the Meta universe
Meta (then Facebook) bought WhatsApp in October 2014 for around $22
billion. Since then, industry watchers have been watching closely for signs
the company plans to monetize the platform more. That time could now be
coming.
Jules Boutsen XMM101A
“If I stay on any of the Meta properties and I’m communicating using Meta,
asking questions, and buying — all within the platform — there is no signal
loss, and it’s easier for Meta to tell the brand its return-on-advertising
spend,” said Mark Kelley, managing director and senior equity research
analyst at Stifel. “Signal loss is really what’s been impacting social media
companies this year.”
WhatsApp will be the “next chapter” in the company’s history, Meta CEO
Mark Zuckerberg recently told CNBC’s Jim Cramer. He noted that the
company’s “playbook over time” has been to build services to serve a wide
audience and “scale the monetization” after reaching that goal. “And we’ve
done that with Facebook and Instagram. WhatsApp is really going to be the
next chapter, with business messaging and commerce being a big thing
there,” he said.
This messaging from Meta comes at a time of transition for the company
and uncertainty among investors. The company recently reported an
earnings and revenue miss and forecast a second straight quarter of
declining sales. Meta Platforms shares have lost roughly half their value this
year. Mark Zuckerberg is betting large sums of money, currently at a
loss, on a future in which the metaverse will be a growth driver for the
company. But with his bet on the metaverse as far as a decade out before
coming to fruition, the Meta CEO has stressed that in the short-term it is
WhatsApp that is among the initiatives to focus on for growth.
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Jules Boutsen XMM101A
Meta’s Mark Zuckerberg on seeing a
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WhatsApp Business has two components. There’s the WhatsApp Business
app for small businesses. There’s also the WhatsApp Business platform, an
API, for larger businesses like banks, airlines or e-commerce companies.
The first 1,000 conversations on the platform each month are free. After
that, businesses are charged per conversation, which includes all
messages delivered in a 24-hour session, based on regional rates.
With the free app, small businesses can communicate directly with
customers. They can set up automated messages to respond to customers,
after business hours, for instance, with information about the business,
such as a menu or their company’s location. Businesses can use it to send
product pictures and descriptions to customers as well as other information
they might be interested in. At present, there’s no ability to pay through
WhatsApp, but it’s a feature Meta is considering, a company spokesman
said.
Premium features for small businesses — to be rolled out in the coming
months — will include the ability to manage chats across up to 10 devices
as well as new customizable WhatsApp click-to-chat links to help
businesses attract customers across their online presence, the company
said in its blog.
“We think messaging in general is the future of how people are going to
want to communicate with businesses and vice versa. It’s the fastest and
easiest way to get things done,” the spokesman said.
Why Main Street business is a focus for the WhatsApp
push
Analysts see the broad potential. “Messaging is an international forum that
everybody uses on an ongoing basis. It’s massive and it’s growing,” said
Brian Fitzgerald, managing director and senior equity research analyst at
Wells Fargo Securities.
There’s considerable room for growth in the U.S., where WhatsApp is still a
“a largely untapped resource by small businesses,” said Rob Retzlaff,
executive director of The Connected Commerce Council, a non-profit
organization that promotes small businesses’ access to digital technologies
and tools.
Jules Boutsen XMM101A
That’s something Meta sees changing over time. “We are deep believers
that that behavior will continue to grow all over the world,” said Sheryl
Sandberg, the company’s chief operating officer, on its second-quarter
earnings call on July 27. The company estimates that 1 billion users are
messaging with a business each week across WhatsApp, Messenger and
Instagram.
The need for free and low-cost digital tools for small businesses is
underscored by a 2021 report from The Connected Commerce Council. The
report noted that about 11 million small businesses would have closed all or
part of their business if not for digital tools that allowed them to continue to
operate.
One driver for Meta in promoting WhatsApp Business is advertising
revenue. “Click- to-message is already a multi-billion dollar business for us
and we continue to see strong double-digit year-over-year growth,”
Sandberg said on the second quarter earnings call. Click-to-message “is
one of our fastest growing ad formats for us,” she added. The company
does not break out how much of the business comes from WhatsApp
versus Messenger or Instagram.
Businesses like this format because it’s “an inexpensive way to interact
[with consumers] that feels a little more personal,” said Stifel’s Kelley.
What’s more, it also alleviates a problem caused by the privacy change
Apple made to its iOS operating system last year.
Say, for instance, a customer views a Facebook ad for a sneaker retailer
and connects directly with the business through WhatsApp. “In a world
where we’re trying to do more and more with less and less data, there’s no
leakage here. Everything’s protected,” Fitzgerald said. “Nobody [else] in the
world knows I bought these sneakers and there’s a direct business-to-
consumer connection.”
Moreover, by offering premium services, Meta could boost revenue, at least
incrementally, Kelley said.
José Montoya Gamboa, owner of Malhaya in Mexico, who has been using
the free business app for several years, said he plans to pay for the
premium version when it becomes available because he likes the ability to
use it on multiple devices.
But Geraldine Colocia, community manager at Someone Somewhere, a
certified B Corporation that collaborates with hundreds of artisans around
Mexico, isn’t sure. She’s been using the free version of the app for more
Jules Boutsen XMM101A
than two years, and would consider paying for it, but the decision will turn
on the actual features and the pricing, she said.
Munk, C. W. (2022, August 8). Why Mark Zuckerberg is talking so much about Meta’s
Whatsapp for business. CNBC. https://www.cnbc.com/2022/08/07/why-meta-and-
mark-zuckerberg-are-betting-big-on-whatsapp-for-business-.html
Jules Boutsen XMM101A
Glossary
industry Someone that is interested in the developments and changes of a
watchers particular thing.
“The financial hit was greeted with some dismay by the media, but
industry watchers believe the short-term pain will be worth it.”
managing The role of a managing director is to direct and control the company’s
director operations and to give strategic guidance and direction to the board to
ensure that the company achieves its mission and objectives.
“There’s a board of five directors, but she is the Managing Director.”
Monetization Monetization means to change something into money. Or the action or
process of earning revenue from an asset is also called monetization.
“Youtubers can monetize their videos so by every view they get paid.”
Commerce The activity of buying and selling, especially on a large scale.
“He paid a visit to Nashville last year on official council and chamber of
commerce business.”
API API stands for application programming interface and means, contract of
service between two applications.
“Apple says this application was banned because it used a non-public
API.”
Equity research research public companies and come up with recommendations for
analysts investors about whether to buy, sell, or continue holding certain stock.
“My Equity research analysts recommended me to buy tesla stocks
before they start raising.”
Underscore To underline, highlight, indicate, etc.
“Make sure you underscore that date it’s very important.”
Alleviates to make something, such as pain or suffering more bearable.
Jules Boutsen XMM101A
“The doctor tried to alleviate her symptoms/suffering.”
Leakage deliberate disclosure of confidential information.
“A leakage of kerosene has polluted water supplies.”
Business-to- Also known as B2C, Business to consumer is a business model where
consumer products and services are sold directly to the consumer.
“A number of people are familiar with the concept of business-to-
consumer direct mail advertising campaigns.”
Revenue The total amount of money that is produced by selling the goods or
services to the customers or businesses.
“The factory lost revenue because of the strike by the workers.”
Several more than two but not many.
“It took several days for the package to arrive.”
Consider Think carefully about something, typically before making a decision.
“We are considering you for the job.”
Uncertainty Any decision that a business is unable to predict or directly influence
which may lead to negative outcomes as a result.
“There is some uncertainty about the company's future.”
CEO CEO stands for chief executive officer which means, the top position in
an organization.
“Richard Davis is the founder and CEO of the business.”
