After the Wall Street Journal published a report on Facebook’s move to put up ads on WhatsApp, the parent company seems to have shelved the option of monetizing WhatsApp via showing ads in the Status section. Turns out Facebook reportedly is working on a different revenue model for WhatsApp and how it could tap into this billion-dollar worth stream.
The last report by WSJ detailing about ads that WhatsApp will soon show, there have been numerous reports about WhatsApp to show ads to its users time and time again. WhatsApp is expected to cash in over $22 billion in ad revenue thanks to its popularity across the globe and its userbase of more than a billion people.
As Digital Trends puts it, WhatsApp didn’t change its decision not to showcase ads out of courtesy or generosity but rather it has a different business model in mind that will target its WhatsApp Business app that was released for businesses to communicate deals, discounts, updates and more to its customers.
WhatsApp Business provides its clients to open an online storefront so that they can do business, handle transactions and more using just the app. Furthermore, they can also set up automated bots to answer queries and questions.
With that being said, WhatsApp is huge in India and Brazil where there are millions of merchants doing business on its platform. Here, Facebook’s return on advertisements shows that Asian countries have a return as nominal as $2.13 on a dollar which increases 1000 folds to make $19.38 when it comes to countries like the U.S. and Canada. Thus, having an ad-based business model for people in these countries wouldn’t have higher returns.
However, since we already have millions of merchants setting up their storefronts on WhatsApp Business, it could be a new way WhatsApp could show ads and generate revenue without hindering users on its instant messaging client which has a userbase exceeding one billion and counting.
Anyways, we are yet to get official confirmation from Facebook-owned WhatsApp as of now.