Why Facebook’s move to introduce ads on WhatsApp is a complicated affair

The platform has over 1.5 billion users across the world and 400 million in India

With this move, the company has positioned itself as a marketing hub
With this move, the company has positioned itself as a marketing hub

By Priyanka Gupta

It’s a new year and more so for Internet firm Facebook which announced the roll-out ‘Status Ads’. What this means that an advertiser will be to showcase its ads in-between status stories on the chat app. Users can also share their WhatsApp stories on their Facebook timelines. The roll-out not only provides a huge opportunity for the Internet company to increase earnings from advertising, for advertisers it a chance to tap into a large captive audience base. The platform has over 1.5 billion users across the globe. If we consider India alone, there are more than 400 million active users who use it to chat as well for business transactions.

With this move, the company has positioned itself as a marketing hub. At present people do share ads or other marketing-related products and ideas within communities and groups, that they are part of. WhatsApp allows a group of 250 users, currently. Even though the size of communities of groups is restricted the virality factor associated with the platform is of great interest to a marketer at all levels. For instance, during the 2019 General Elections in India, political parties leveraged the medium extremely well to reach out to their audiences.

For Chaya Bharadwaj, founder and MD, BC Webwise, advertisers and agencies are already tapping the platform for business. “They also build content/chat that can lend itself well to engaging this vast consumer base intermittently through their waking hour. So undoubtedly the opportunity is nothing less than phenomenally huge,” Bharadwaj, said.

Read Also: WATConsult unveils a digital brand campaign for Wacoal India

Interestingly, the platform despite the potential had been averse to the idea of running ads. There is no doubt that WhatsApp is the smarter version of SMS. It is a quick and efficient messaging platform for long or short format or rich media. It is also the easiest and quickest way to share any content or information for those who are already digital natives. According to Pratik Gupta, co-founder, FoxyMoron on WhatsApp, the opportunity for brands to reach out to its audience is massive in terms of number as well as intent. However, it is too early to put a number to the size of this opportunity.

Safety and Security

Over the years, WhatsApp has been caught up in several kinds of controversies and in certain cases governments had to intervene. Privacy and security have always remained what is called ‘Achilles heels’ for the platform. The Internet firm has from time to time tried to monitor WhatsApp’s usage as a platform which is a ‘powerful public influencer’. This brings us to the question with Facebook opening WhatsApp to advertisers, how secure will be user data. Advertisers usually keep a track of the audience profile to release targetted conversations and to gauge the impact. As per Gupta, the company’s move should not affect the privacy and security of the platform at large. “These two factors should remain sacrosanct for any platform today. Depending on the product, and how they will use our data (if at all) will determine whether any norms have been relaxed or not,” Gupta explained.

Also with WhatsApp being part of the Facebook family, it has access to the same pool of databases. Now, there is a possibility that WhatsApp will be able to target Facebook users with an active WhatsApp profile. In this case, Facebook has access to an individual’s name, age, locality, interests and other important details that are easily available to the platform. This will further allow marketers to create targetted content. “The numbers on the Ads on Stories on Instagram have looked very good, with a large population interacting a lot more on the stories than on the newsfeed,” he noted.

Further, it will be interesting to watch see whether Facebook will make UI/UX changes to accommodate stories into the main chat window or not – because presently WhatsApp is the only platform that has a different tab called Status, where stories play. On Facebook and Instagram, stories can be accessed on top of the main page.

Quit WhatsApp movement

The move has raised many eyebrows so much so with users threatening to quit the platform as it has always been known for being ad-free.

WhatsApp is used frequently by people and the exit will completely depend on how intrusive the advertising experience will be for audiences. There are after all alternatives to WhatsApp like a Wire or Hello, among others. And just like Google replaced Yahoo Search a few years back, or Facebook replaced an Orkut, you never know what will come next.

Read Also: ASCI comes out with guidelines to use awards and rankings in ads

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express Telegram Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.