Facebook Officially Launches WhatsApp Business

MarketsMotley Fool

Less than a year after recruiting product managers for the explicit purpose of monetization, Facebook (NASDAQ: FB) subsidiary WhatsApp has now officially launched WhatsApp Business. The launch comes just a few months after WhatsApp said it was working on such an app, and COO Matt Idema told The Wall Street Journal that the app was in development and that the company would eventually charge larger enterprises a fee for the service.

It's about time.

Continue Reading Below

Monetization is coming

The new app is catered to businesses looking to deliver customer service, and will feature business profiles and Confirmed Accounts so that consumers know they're interacting with legitimate businesses. There are a few functions that are specifically designed for companies, including quick replies and greeting messages, as well as statistics and analytics so businesses can determine if they're connecting with their customers properly (and if their messages are being read).

Users will still retain the ability to block numbers, including any businesses that might be sending an excessive number of unwanted messages. The app is launching today on Android only initially, starting in Indonesia, Italy, Mexico, the U.K., and the U.S. More countries will get the app in the weeks ahead.

Why Android first

Although not included in the initial launch countries, WhatsApp mentions two important markets numerous times in its blog post: Brazil and India. WhatsApp notes that over 80% of small businesses in Brazil and India say that WhatsApp helps their businesses, citing a Morning Consult study. In addition to the fact that WhatsApp Business is launching first on Android, these subtle details are meaningful.

WhatsApp is overwhelmingly popular in emerging markets, serving as an SMS replacement in regions where low-cost Android phones dominate. iOS has long faced hurdles expanding in these markets due to its premium pricing. The Android and iOS market share stats for those countries are all you need to know:

It won't be long until WhatsApp Business launches in Brazil and India, two of the fastest-growing emerging markets. India is WhatsApp's largest market, with 200 million monthly active users (MAUs).

An iOS version is undoubtedly in the pipeline as well, but it shouldn't be a priority. Facebook Messenger complements WhatsApp very nicely, being more popular in developed markets, and there's already a version of Messenger for businesses. Both messaging services are banking on connecting consumers with companies as a monetization model.

Patience is a virtue

WhatsApp hasn't publicly provided any specific details regarding pricing, either on its site or through the Google Play store. In the aforementioned WSJ interview, Idema had said, "We don't have the details of monetization figured out."

As is often the case with new Facebook offerings, the company focuses first on establishing social behaviors and growing its services to critical mass before attempting to monetize them. That includes getting businesses onboard and accustomed to the idea of supporting customers through a text-based messaging platform. Besides, Facebook is in no rush.

It's now been about 3.5 years since it closed the $21.8 billion acquisition, and asking investors to wait a few more months to hammer out pricing is negligible.

Find out why Facebook is one of the 10 best stocks to buy now

Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. (In fact, the newsletter they run, Motley Fool Stock Advisor, has tripled the market!*)

Tom and David just revealed their ten top stock picks for investors to buy right now. Facebook is on the list -- but there are nine others you may be overlooking.

*Stock Advisor returns as of January 2, 2018

Evan Niu, CFA owns shares of Facebook. The Motley Fool owns shares of and recommends Facebook. The Motley Fool has a disclosure policy.

Continue Reading Below