Brief:

• WhatsApp, the Facebook-owned messaging app with about 1.5 billion users, plans to charge companies for sending marketing and customer service messages as the app expands its support for businesses, it announced in a blog post on Wednesday. Businesses can use the WhatsApp Business API for notifications like shipping confirmations, appointment reminders and customer service messages.​ Parent company Facebook will soon let marketers use the Facebook Ads Manager to add a click-to-chat button to their advertisements, per VentureBeat.
• Uber, Booking.com and KLM Airlines are among the first 90 companies that have access to the WhatsApp Business API, which the app will gradually offer to more businesses. WhatsApp is charging a premium compared with short-message service (SMS) rates, as the company acknowledged, per Reuters.
• Clarabridge, a provider of customer experience management (CEM) software, is an official solution provider for WhatsApp Business, according to a statement shared with Mobile Marketer, and Swiss International Air Lines and General Mills are among the first brands that are using Clarabridge's CX Social social media manager in its initial limited rollout for WhatsApp messaging.

Insight:

WhatsApp's plan to expand business chat follows its initial announcement in January that small businesses would be able to communicate with their customers through the app. Since then, more than 3 million people have used WhatsApp Business to chat with companies, Facebook COO Sheryl Sandberg said last week in a call with investors, emphasizing WhatsApp's key strength of its massive user base that still has plenty of opportunity for growth.

A key question now is whether businesses will see the value in using WhatsApp Business, given that it costs more than SMS. Wireless carriers typically charge businesses less than a penny per SMS message, and the price is still close to a penny when fees collected by intermediaries are included, as Reuters notes. Businesses with a high volume of chats likely will see a more significant effect on their costs than smaller companies that use the platform for marketing.

WhatsApp's plan to start charging businesses for communicating with customers through the mobile app comes as parent company Facebook faces greater pressure to boost revenue amid slowing user and sales growth and data privacy scandals. The company last week set a record for the biggest one-day drop in stock market value, losing $120 billion after reporting disappointing Q2 2018 results. Still, Facebook said mobile's share of its ad revenue grew to 91% from about 87% a year earlier. What the social network does have is its massive global reach with 2.5 billion monthly users among its properties, including Facebook, Messenger, WhatsApp and Instagram.

WhatsApp's biggest rival for business messaging is Apple, which has gradually rolled out its Business Chat since quietly introducing the service in June 2017. Business Chat lets people reach customer service, schedule an appointment or make purchases in the Messages app that comes preinstalled on every iPhone and other Apple device. Last week, Dish Network announced that it was the first TV provider to provide real-time customer support on Business Chat, which also provides service to Discover, Hilton, The Home Depot, Lowe's, T-Mobile, Wells Fargo and 1-800-Flowers, among others.