Monetization is hard: The move to transform WhatsApp represents a major effort by Meta to monetize a significant resource that until now has generated relatively small revenues—though how the company plans to generate revenue from the feature remain hazy.
- Meta paid $22 billion for the platform in 2014, making it the company’s most expensive acquisition. Yet messaging across Facebook's apps pulled in a relatively paltry $218 million in the most recent quarter, driven by paid messaging on WhatsApp, per Insider. That’s not even a rounding error for a company that generated nearly $29 billion in total revenues.
- But as the company looks for growth opportunities, it can’t help but daydream about transforming WhatsApp into a WeChat-like super app. WeChat has 820.2 million users in China, per our forecast, and its mini-program economy was estimated last year to be valued at $240 billion, with 450 million users transacting through the program.
- Those eye-popping numbers help explain why Meta has made several strategic investments and updates to its platforms aimed at bolstering chat-based commerce revenues.
The big takeaway: Amid Meta’s current challenges with advertising, it is hardly surprising to see it reimagine WhatsApp as a super app that consumers turn to for everything from messaging to commerce.
- While conversational commerce has not gained traction in the United States and Europe, Meta is wise to see if it can gain a foothold in Brazil, India, and other markets.
- If those efforts prove successful, conversational commerce could provide a fresh revenue stream for Meta and, at the same, shield it from some of the detrimental impact that Apple’s privacy changes have had on its advertising business.
Go further: Read our Future of Meta report.
This article originally appeared in Insider Intelligence's Retail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.