EDIT: On 16th Jan 2020 the Wall Street Journal reported that 'Facebook Backs Off Controversial Plan to Sell Ads in WhatsApp.'
That Wall Street article states: "The company plans at some point to introduce ads to Status", so it's still a case of 'when' will there be ads in WhatsApp rather than 'will' there be ads.
We believe that this announcement from Facebook fundamentally changes nothing and that the questions posed in our article still stand.
We are about to see a major change to the Facebook-owned consumer messaging app WhatsApp.
Advertising is coming to the WhatsApp platform.
The popular app launched in May 2009 and was acquired by Facebook in February 2014. Facebook’s other messaging app, Facebook Messenger, has shown ads to its users since 2017.
But will advertising be welcomed in a messaging app that has been ad-free for 10 years and is such a big part of many people’s lives? Or will there be outrage and a mass exodus...perhaps even a call to #DeleteWhatsApp?
Will WhatsApp advertising largely go unnoticed or will it be intrusive and clunky?
And what will this mean for businesses and professionals using WhatsApp?
We spoke to industry experts Stephen Waddington - MD at Metia, Katy Howell - CEO at immediate future, Lucy Walker - Audience Director at eight&four and Ashley Friedlein - CEO at Guild to gather their thoughts.
What do we know about WhatsApp advertising so far?
Well the truth is...we know very little!
Facebook announced that ads were being introduced on WhatsApp at Facebook's annual Facebook Marketing Summit in the Netherlands in May 2019.
Industry expert, Matt Navarra was the first to break the news on Twitter:
Coming Soon to @WhatsApp...— Matt Navarra (@MattNavarra) May 21, 2019
- WhatsApp Status (Stories) to get Ads in 2020
- WhatsApp for Businesses to get richer messaging format options
- WhatsApp product catalog to be integrated with existing Facebook Business Manager catalog
h/t + ? @Olivier_Ptv
at #FMS19 pic.twitter.com/Z5LsbADNbP
Facebook had announced that WhatsApp would show ads in a WhatsApp users’ Status in 2020.
What is the WhatsApp Status?
WhatsApp Status looks a lot like Instagram Stories. It launched in 2017 to replace the text based ‘away’ user status. 'Status' allows a WhatsApp user to share text, photos, videos and GIF updates that disappear after 24 hours - just like Facebook’s other popular Stories formats in Instagram and Facebook.
Users must have each other's phone numbers saved in their smartphone address books to send and receive WhatsApp Status updates.
Unless things change, Facebook have announced that this is where the first ads in WhatsApp will appear.
When are WhatsApp ads launching?
There have been no further official Facebook announcements on this. Nothing more concrete than 'some time in 2020' has been mentioned.
What will WhatsApp advertising mean for its users?
Consumer messaging apps are designed for social chat. But without user subscriptions, they need to monetise in other ways.
The Facebook owned platform has shifted to this ad-funded model. Or, as Stephen Waddington, Managing Director of marketing agency Metia and Visiting Professor at Newcastle University explains:
“Tech platforms are keen to monetise attention. End-users are the product.”
There are an estimated 500 million daily active Whatsapp status users globally. This is just under a third of total WhatsApp users.
Unless Facebook decides to place ads in Chats, or messages between users - which we very much doubt - only a third of users might initially see WhatsApp ads at launch.
If those users are already using Instagram, Facebook or Facebook Messenger and the Stories features, then they will be very familiar with this type of social media advertising format – it’s a branded ad, in the format of a Status appearing on or between a friends WhatsAppStatus with a call to action such as ‘Install Now’, “Sign Up’ and ‘Learn More.’
It is possible that WhatsApp Status ad formats will look very much like this ad format.
If Facebook stick to the announcement that ads will appear in WhatsApp Status only, the reality is that very little will change. Many users will happily continue to use the consumer messaging app without even seeing an ad!
The current WhatsApp user interface won’t change and the Chats screen will continue to show a mixture of the most recent messages from Groups and contacts.
However, it could be a totally different matter if WhatsApp mirrors existing Facebook Messenger ad placements and users begin to see ads in the ‘Chats’ screen. This would be much more like the Facebook Messenger current user experience.
Katy Howell, CEO of social media consultancy, immediate future thinks that Facebook won’t actually do anything different from what they have already announced. She feels that consumer reaction will depend more on whether there is a high profile data privacy issue between now and launch:
“I think that there will be an initial negative buzz amongst groups of users, but as ads are unlikely to feature in WhatsApp chats themselves, I suspect it will die down quickly. Unless, of course, Facebook has another privacy issue, or messes with the format.”
Lucy Walker, Audience Director at Creative and Media agency eight&four, questions whether WhatsApp's Status feature has enough users for Facebook to be satisfied with restricting ad placement to there alone:
"Facebook are currently saying that the ads will be based within WhatsApp Status but I would question the usage level of this format across all markets."
Stephen Waddington agrees that it is likely that Facebook will look at other WhatsApp ad placements and predicts an initial user backlash:
"Stories aren’t a popular feature of the platform. WhatsApp will almost certainly find other formats that work on the platform. Users typically react badly to change but it’ll settle down."
What do GDPR and CCPA mean for WhatsApp advertising?
It will be interesting to see what controls, if any, WhatsApp offers its users to opt-out of any advertising or tracking of their personal data including usage patterns.
According to the California Consumer Privacy Act (CCPA), which came into force this January 2020, users must be allowed the option to prevent the sharing of their data. Indeed, consumers have the right to tell WhatsApp not to use their data even if they are not themselves a WhatsApp user - for example, if someone you know uploads your contacts details as your are in their mobile address book. It is hard to see how this can work in practice unless WhatsApp puts in place more controls when accessing users' phone contacts.
In any case Facebook has argued that the CCPA does not apply to them, despite legislators views to the contrary, so perhaps WhatsApp will simply not adhere to the CCPA until there is further clarification or court rulings.
With GDPR, WhatsApp places the responsibility for compliance on its end users though it is hard to see how it can be used in a compliant way as this lawyer argues and you still cannot get a copy of your own messages with a SAR (Subject Access Request) or request for your personal information.
What about Facebook's plans to integrate its messaging services across WhatsApp, Messenger and Instagram?
Here is where things start to get very interesting, but also a little confusing.
The BBC reported that in early 2019 that Facebook planned to integrate its messaging services on Instagram, WhatsApp and Facebook Messenger but they would also remain stand-alone apps.
Facebook seems to be in a long development process to link the products, so that messages can travel between the different services.
The same BBC article mentions that cross-platform messaging could lead to users of one Facebook platform being able to message people on another. In theory, this could mean that, in the future, an Instagram user could message a WhatsApp user.
It also states that “it might make it easier for Facebook to share data across the three platforms, to help its targeted advertising efforts.” If this is the case, then it could very well pique the interest of regulators to review Facebook’s data handling processes.
Katy Howell, said that this integrated approach and any potential interweaving of platforms and features plays to Facebook’s favour as an advertiser:
“Whilst reach numbers for WhatsApp ads might be low at first, if they link Instagram/Facebook Stories with WhatsApp, then usage could grow.”
Lucy Walker agrees:
"It's likely that Instagram and Facebook stories is over saturated, so brands are seeing CPMs increase and its just additional inventory for Facebook in the end."
Whatever happens, any form of integration across these Facebook platforms could very well pique the interest of regulators to review Facebook’s data handling processes.
So what does WhatsApp advertising mean for business?
Businesses who are using social media advertising to successfully reach their audiences, are likely to add the WhatsApp ad placement options to their existing ad campaigns when it launches.
After all, Facebook Messenger ad placements have allowed advertisers to ‘slide directly into users’ DMs for a while now, with Facebook Messenger ad and Sponsored Message placements.
Facebook’s Ad Manager platform enables advertisers to place ads on Instagram, Messenger and Facebook and manage and track advertising campaigns. So it’s very likely that Facebook will integrate WhatsApp ad campaigns into the same platform. This will keep things simple for advertisers across the Faceboook properties.
That said, questions remain about data privacy and ad targeting, particularly if Facebook does integrate its messaging services.
For example, WhatsApp is an encrypted platform, but will ads will be personalised - as Facebook and Instagram’s are - using information gathered about a users’ preferences and behaviours from the platform and elsewhere?
This could prove to be an issue to some users who use the platform for its encryption.
And it may be a step too far for some advertisers’ compliance teams.
What about businesses using WhatsApp for professional messaging?
Messaging is exploding in use.
And there are many excellent uses of WhatsApp Business where businesses interact with customers using WhatsApps tools to automate, sort and quickly respond to customer service messages.
Lucy Walker highlights this appropriate and strategic use of the platform:
"Brands such as Deliveroo are using WhatsApp as a channel to keep audiences up to date with orders, and brands should remain smart and ensure that they are using the channel to keep consumers informed in a non-intrusive way."
But businesses are struggling to keep up in terms of having clear strategies and policies that they can actually police and actively enforce professional communications using consumer messaging platforms such as Messenger, WhatsApp, Telegram and Signal
Specific customer service features aside, there are also risks and GDPR and CCPA data compliance requirements around using consumer messaging platforms for business purposes that many organisations are unaware of, or are ignoring.
We have highlighted the dangers of using WhatsApp for business messaging and a lawyer's view of whether WhatsApp is in breach of the GDPR in other blog posts.
So, business users, who simply don't know about or are ignoring WhatsApp’s terms of service, may not see much happening in their WhatsApp professional chats. The user interface may look virtually the same.
But if ads become more visible between those professional and personal messages, and it becomes a noisy feed, users may start to think about Facebook’s strategy to integrate its properties.
Business users may think about using the encrypted consumer messaging platform a little differently. Stephen Waddington believes this will be the case:
"[Ads] will raise awareness of the fact that WhatsApp is a consumer product. The terms and conditions mandate against using it in commercial applications not least because of GDPR issues."
Lucy Walker highlighted the work that Facebook has done to improve its advertising transparency and how this needs to continue:
"Facebook has been really focusing on being transparent on why we are being served ads and this will need to be replicated in WhatsApp.
If we don’t get a clear understanding of how ads will work within the platform or users are forced into certain behaviours or having to share additional information to continue usage this will really make users question their usage."
Perhaps individuals and businesses may take steps to separate workplace and professional messaging and chats from personal ones. Shadow IT messaging is a potential minefield of risk for businesses.
Ashley Friedlein, Guild's CEO feels strongly that there are many forces at play today that will lead to an un-packing of personal messaging and social media from professional and business communications:
“Organisations need to stop turning a blind eye to the under-the-radar use of consumer messaging apps for business messaging - it’s time to take business messaging seriously and adopt tools, practices and behaviours that are fit-for-purpose and capture value for both companies and individuals."
Stephen Waddington adds:
"It astonishes me that business users haven’t started to question the use of Facebook’s personal applications such as Messenger and WhatsApp in the enterprise. It’s a GDPR time bomb."
So what comes next?
It seems that we all need to wait for Facebook's next move before we see what WhatsApp advertising looks like. And it may a while before we know what its impact will be.
Be sure that we will continue to monitor this closely. We believe that there are people seeking ad-free messaging apps and WhatsApp alternatives particularly for business and professional use.
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