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The news: Meta CEO Mark Zuckerberg on Thursday mapped out a super app-like vision for WhatsApp that would enable consumers in Brazil to find, message, and buy something from a business all within the same chat.
“The ultimate goal here is to make it so you can find, message, and buy from a business all in the same WhatsApp chat,” he said.
The in-app end-to-end shopping would mirror the experience WhatsApp launchedwith JioMart in India this August, but in Brazil it is working with multiple payment partners.
The timing of the plan is significant given that Meta is at a critical juncture. Its main revenue source, advertising, is declining; our newly updated forecast sees the company’s ad revenues dropping 3.7% in the US this year. Yet even though we expect its ad revenues to rise in 2023, the company’s two-year annualized growth will come to less than 1%.
Monetization is hard: The move to transform WhatsApp represents a major effort by Meta to monetize a significant resource that until now has generated relatively small revenues—though how the company plans to generate revenue from the feature remain hazy.
Meta paid $22 billion for the platform in 2014, making it the company’s most expensive acquisition. Yet messaging acrossFacebook's apps pulled in a relatively paltry $218 million in the most recent quarter, driven by paid messaging on WhatsApp, per Insider. That’s not even a rounding error for a company that generated nearly $29 billion in total revenues.
But as the company looks for growth opportunities, it can’t help but daydream about transforming WhatsApp into a WeChat-like super app. WeChat has 820.2 million users in China, per our forecast, and its mini-program economy was estimated last year to be valued at $240 billion, with 450 million users transacting through the program.
The big takeaway: Amid Meta’s current challenges with advertising, it is hardly surprising to see it reimagine WhatsApp as a super app that consumers turn to for everything from messaging to commerce.
While conversational commerce has not gained traction in the United States and Europe, Meta is wise to see if it can gain a foothold in Brazil, India, and other markets.
If those efforts prove successful, conversational commerce could provide a fresh revenue stream for Meta and, at the same, shield it from some of the detrimental impact that Apple’s privacy changes have had on its advertising business.
This article originally appeared in Insider Intelligence'sRetail & Ecommerce Briefing—a daily recap of top stories reshaping the retail industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.