Key Takeaways
- WhatsApp for Business is doing well and is a major source of Meta’s non-advertising income.
- The business has reported a rise in private content sharing, which is consistent with its plan to make money off of direct messages on all of its apps.
- Ten years after Facebook acquired WhatsApp, the messaging app is suddenly proving its value to Meta.
WhatsApp has been the main driver of Meta’s notable increases in non-advertising revenue, according to the social media behemoth.
According to Business Insider, the $16 billion 2014 acquisition of WhatsApp was a calculated risk, but the big investment is already starting to pay off.
In its most recent Q3 earnings call, Meta said that its top Messenger service is the primary factor for a 48% increase in non-advertising revenue across its portfolio of social apps.
Through a membership, WhatsApp’s business messaging service allows businesses to interact with both present and potential clients. Since the third quarter of 2022, the app has been increasing, with the business offering being the main engine of the increases.
Although the $434 million in non-ad revenue is still a small portion of the $39.9 billion in advertising revenue that Meta earned, the growing trend of the revenue stream suggests that there is room for more growth.
Facebook CEO Tom Alison said last month that the firm has seen an increase in content posted via direct messages, or “private sharing,” according to Business Insider. According to Alison, the number has increased by 100% annually.
Change to Formats Based on Messaging
The “most interesting undermonetized asset that they (Meta) have” is messaging, according to Mark Mahaney, a senior tech analyst at investment banking firm Evercore ISI. He focuses on the traffic in direct messages.
For many years, he has been keeping an eye on Meta’s messaging services for revenue on Instagram Direct, WhatsApp, and Messenger.
Additionally, Mark Zuckerberg’s company has been collecting ad revenue from sponsored messages on Messenger’s conversations page. The nascent source is also utilized in “click-to-message,” which uses direct messages to link interested users with businesses. You can use this service on WhatsApp, Instagram, and Messenger.
With the advent of generative AI, Meta can achieve additional substantial income increases from messaging. Instagram CEO Adam Mosseri predicted that sharing would increasingly move from feed-based formats to messaging-based formats.
With each of its networks offering distinct offerings in terms of user demographics, usage patterns, and monetization potential, Meta will face a challenge in leveraging growth and generating profit in messaging.
