WhatsApp Puts Focus on Small Businesses; Bets on Social Commerce and Chat-Based Experiencesby Fintech News Singapore September 15, 2022
Social networking giant Meta Platforms is targeting opportunities related to commerce and payments, leveraging on the popularity of WhatsApp in emerging markets to establish the messaging app as a core communication tool and sales channel for small businesses.
This ambition has materialized over the past year through integrations with and investments in strategic partners across Asia-Pacific (APAC).
In India, WhatsApp launched a few weeks ago its partnership with e-commerce platform JioMart, allowing people to browse the JioMart catalog, add products to their cart and pay to complete purchases, all within WhatsApp.
The integration represents the first end-to-end shopping experience in WhatsApp, Meta said in a statement. JioMart is part of Reliance Industries’ Jio Platforms, an Indian tech company that Meta invested almost US$6 billion into in early 2020.
In Singapore, the firm recently invested in Take App, a platform that allows stores to build their own website to take orders online and run WhatsApp newsletter campaigns easily.
The platform, which claims 1,000 merchants from 30 countries, focuses primarily on restaurants but says it also works with bakeries, grocery businesses and beauty salons, among others.
The core Take App service is free but the company does offer premium features such as advanced analytics, unlimited image uploads and custom domain names.
These recent developments illustrate Meta’s focus on social commerce and chat-based experiences for its popular messaging app, areas where CEO Mark Zuckerberg has been bullish on.
This path is similar to the trajectory taken by some of the region’s so-called super apps, focusing first on building up a large userbase and then expanding to multiple services to eventually becoming an all-encompassing self-contained commerce and communication online platform.
China’s WeChat, for example, started out as a messaging app before adding payments, e-commerce, video games, video conferencing, and more. In 2018, it became the world’s largest standalone mobile app with over 1 billion monthly active users.
Meta acquired WhatsApp in 2014 for a staggering US$22 billion, but the business has never really been profitable. Hoping to change that, the firm has been, over the past couple of years, focusing on developing in-app shopping capabilities and payments, targeting small businesses specifically.
In 2018, it launched WhatsApp Business, a service designed for the needs of businesses that has two main components: a free app for businesses to communicate directly with customers, and the WhatsApp Business API for larger corporations which charges companies for every conversation after the first 1,000.
Premium services are expected to be rolled out on WhatsApp Business soon, allowing, for example, companies to manage chats across up to ten devices and use customizable WhatsApp click-to-chat links.
Click-to-chat advertising allows people that click on an ad to be sent directly into a conversation with the business in WhatsApp, Messenger or Instagram. The feature has been a point of success for WhatsApp in recent years and is expected to be a major growth driver for Meta moving forward.
WhatsApp is India’s most popular messaging app, boasting over 400 million users. The company started working on a payment service in the country as early as 2017. Pilots and tests began rolling out in early 2018 but were met with concerns over data privacy and unfair competition in the payment market.
WhatsApp’s payment feature, which allows for peer-to-peer (P2P) transactions, was eventually launched in 2020 but the National Payments Corporation of India, the payment body that oversees the widely popular Unified Payment Interface (UPI) instrument, the country’s real-time payment system, limited the rollout to 40 million users. That limit was extended to 100 million in April 2022.
Besides India, the payment capability is also available in Brazil. Reports dating back to 2019 have hinted at payment functionalities could be coming to Indonesia next.
With over 100 million users, Indonesia is one of the top-five markets globally for WhatsApp. It’s also Southeast Asia’s largest economy with a fast-growing e-commerce sector projected to reach US$83 billion by 2025, growing from US$32 billion in 2021.
Featured image credit: meta