What brands can expect from WhatsApp's new free model and promised business 'tools'

People of the world rejoice! Or at least those using WhatsApp (one billion and counting). Those who hadn’t already succumbed to the 69p fee after the first 12-months of using the app can rest easy, as the Facebook-owned, messaging giant announced in a blog post that WhatsApp would now be free for all, for life.

As the company itself addressed in the post, this doesn’t herald a move towards paid-for advertising within the app – but there will be opportunities for brands. It wrote: "Starting this year, we will test tools that allow you to use WhatsApp to communicate with businesses and organisations that you want to hear from ... we want to test new tools to make this easier to do on WhatsApp, while still giving you an experience without third-party ads and spam."

The cynical among you will of course wonder why a company Mark Zuckerberg paid $19bn for has suddenly decided to remove what seemed like its only revenue stream, but taking a peek over at its stablemate Facebook Messenger, it seems fairly obvious that when WhatsApp references ‘tools’ they are more than likely to replicate the Businesses on Messenger approach which was announced at F8, with use cases such as hailing an Uber, or changing an online delivery seamlessly from within the app itself.

As mobile time is increasingly spent with messaging, it looks likely that this will be the next major battleground in the war for mobile domination.

So from the relatively straightforward iOS vs Android battle, it’s now Facebook Messenger vs WhatsApp vs LINE vs WeChat vs Skype vs BBM vs Viber, with WeChat leading the way when it comes to both utility and sheer numbers – 63 per cent of China are now active users after only five years of the app being in existence.

For consumers there is increased convenience, shifting away from individual services/apps towards a universal, task-oriented tool that allows them to order a cab, send a friend money, or check a flight status. But this needs to be tempered with concerns on both privacy (which neither Facebook or WhatsApp rate highly for) and security, which for idle chat is probably fine, but when it comes to banking or shopping, probably needs to be a lot tighter.

For certain brands, this opening up of the platform could be a great way to reach people on a platform where previously they were ostracised, have direct contact with their customers (all shielded from public view, avoiding potential Twitter spats and fails), and all with the likely initial promise of it being “free”. Those with short memories and reduced marketing budgets should remember fan pages in this context. There is also the danger that brands will essentially be outsourcing their services to the apps, resulting in limited cut through/differentiation, and wrapped up in a homogenous messenger “service”.

For WhatsApp and Facebook in particular, the benefits are potentially huge. As social platform growth stagnates, and messaging grows, it offers a pervasive means of accumulating exponential amounts of data beyond demographic, behavioural, and location to more granular understanding around purchase and interactions with other brands and services, to date something which Google has had almost exclusive access to at scale. This data will then of course help to feed their ever expanding advertising money machine.

WeChat has shown how constant innovation and integration in the messaging space can lead to pre-eminence in the mobile space as a whole, and WhatsApp/Facebook seem to be closely mimicking them in the aim for world domination. No doubt we will one day hark back to the simpler times of the 69p app.

Nicholas Larder is strategy director at Starcom Mediavest Group

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