Facebook Shies Away From WhatsApp Ads
On Friday Facebook announced it was abandoning efforts to begin selling ads on its messenger platform WhatsApp. This is a significant pivot, given the fact that FB had been pushing so hard to monetize WhatsApp that the original founders resigned in protest 18 months ago. So what changed?
To answer that question you first need some background on WhatsApp’s journey. Back in 2014 WhatsApp was a blossoming personal messenger app which made money by charging an initial download fee and then a $.99 annual subscription fee. With 1.5B worldwide users it was a nice little business that Facebook eventually purchased for $16B. After the acquisition Facebook made WhatsApp free to download and use, because Mark Zuckerberg and Co had their eyes on a much bigger prize . . . running ads across the platform. This set into motion a tug-of-war for the soul of WhatsApp, which eventually led to the resignation of founders Jan Koum and Brian Acton in the Summer of 2018.
Since then Facebook has been working behind the scenes to create an ad platform on the messaging service. However, this past month WhatsApp disbanded the team that had been established to find the best ways to integrate ads into the service. So why the strategy change? While FB hasn’t officially commented, the decision probably has to do with the app’s UX. WhatsApp is primarily used for person to person communication, so the idea of a brand dropping an ad message within a personal text chain could feel clumsy at best and creepy at worst.
So what’s the future of WhatsApp monetization? They’re currently working on backend B2B products like an online payment platform and customer service response tools. In the meantime, WhatsApp will remain ad free for the foreseeable future.