People & Startups

Digital Wallet may soon be replaced by WhatsApp for Business: WhatsApp launches Broadcast and digital payment integration over its chat platform

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Since 2014, post Facebook bought Whatsapp for $19 billion, it was evident that Facebook is trying to gain inroads to the messaging services for a monetisation purpose however Facebook stepped back many times owing to the User Experience of WhatsApp. Now with much bigger and sticky base (users gaining familiarity with WhatsApp) Facebook is looking to take up another step to monetize WhatsApp services called as “Whats App for Business”

Whats is WhatsApp for Business?

WhatsApp will be enabling a feature for leading businesses called “Verified Business Accounts” These business accounts can be easily identified with a greed badge having a tick sign which will ensure legibility and authentication. These Verified Business Accounts can send whatsapp broadcasts to their user on all offers, confirmations (such as booking confirmations, OTP etc) to each user directly on their WhatsApp. The users will also have the functionality to block the verified accounts on their whims thus further putting the user at the podium.

Green Badge for verified businesses

Green Badge

To decipher further, once you have shared your number with any business you could get all your communications starting from offers to confirmation of your booking through WhatsApp. Currently WhatsApp is working only with some handful of companies in India to test the efficacy as well as user experience to fill in gaps between User and Business Expectation.

Currently as a pilot phase in India, WhatsApp has collaborated with BookMyShow, OYO and Ola to start testing their services. These companies will be interacting with their users on some of the fronts over WhatsApp and relevant user and data insights will be shared mutually to enhance the overall goal of Whats App, i.e is to bring online payments and e-commerce driven through the chat tool itself.

Why would Companies and Businesses go for “WhatsApp for Business”?

The answer lies in the concept of “Sense of familiarity”. Since years, people have used WhatsApp to chat, call and interact through chat and voice based messages. Nearly almost 65 to 70% of their information (Music, Videos, Photos, Elinks, Text etc) and data transaction happens through WhatsApp. They have formed or joined peer groups which are essentially need and geographic based. All these features as a whole brings in a great sense of familiarity towards the brand which essentially means that the user will not leave the brand in case there is a pinch of commercial activity been introduced, that too with a huge amount of relevance and option to disintegrate any time with just click of a button.

This process, crucially brings in a great balance between “User Expectation and Business Purpose” and fostering businesses which really stands out on their services with their users.  On the other hand, businesses are eager and are on a close watchout for platforms like WhatsApp, which with its virtue of extreme relevance and utility in the life of users, penetrates much deeper than any other app or tool for that matter.

To better understand, let’s talk of an example. Say you booked a taxi through an app and post the booking of the taxi (involves the time span from boarding to un-boarding) you shut the app and chances are less that you would seeing it till your next ride. Now you have a WhatsApp Business Verfied account of the Taxi App on your WhatsApp list. Right from taking a feedback to supplying you with offers and introducing new services, all of this can happen with a better click rate for Businesses over WhatsApp as the chances are more that the Users are going to respond better on WhatsApp than push notifications sent to them over the native app.

WhatsApp shall soon be a new tool for commerce for leading Businesses Globally 2

WhatsApp shall soon be a new tool for commerce for leading Businesses Globally 2

Whats App has a Daily Active User Base (DAU) of 1 Billion while the Monthly Active User base (MAU) of 1.3 billion. Thus the DAU:MAU ratio which clearly identifies brand stickiness is 77%. As an Industry standard it ranges from 15 to 25% which distinctively makes WhatsApp as a great tool of commerce for Businesses.

WhatsApp will replace the traditional Digital Wallet Market with WhatsApp Payments

Now just realize what you could do in an Digital Wallet App (completing a banking transaction through OTP, secure codes and PIN) can be done on a chat screen of WhatsApp right from looking at the offer ( clicking on the elink in an embedded screen like a browser) to paying from your bank (through Netbanking, IMPS, Debit Card or UPI) which also has the functionality to save your banking details and cards, upon your choice. Slowly and gradually, users will be given the option of using chat windows to transact on all P2P based (peer to peer based transactions such as sending money to a friend), also through WhatsApp chat sceen. In the past, similar attempts have been carried out by some of the new age banks especially Axis Bank which launched their Chat tool to transfer money as a peer to peer transaction.

Speaking on the development over the rollout of the WhatsApp for Business Alan Kao, software engineer at WhatsApp said “Almost anything we will be doing will focus in this particular area, User privacy will always be important, whether its payments, sending video or messages.”

The statement clearly says WhatsApp shall be bringing in the huge change in the existing digital transaction economy which shall be massive, and may result to huge losses to Digital Wallet Companies who are still seeking growth curves but are not prepared for a change of such kind.

 

2 Comments

2 Comments

  1. Santosh This is a potential threat to the entire gamut of companies in Fintech and Digital Wallets....

      Reply06 Sep, 2017 12:52 PM

  2. Ritu Ghai look forward to it

      Reply07 Sep, 2017 5:30 PM

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