Two years ago Facebook spent nearly US$22 billion to acquire mobile messaging app WhatsApp. With a billion active users each month, it has since grown to become the world’s most popular messaging app.
Now WhatsApp has announced an update to its privacy policy allowing Facebook access to users’ account information (including phone numbers, but not messages). The changes also allow businesses to contact WhatsApp users.
In a blog post, WhatsApp describes the policy change as “part of our plans to test ways for people to communicate with businesses…while still giving…an experience without third-party banner ads and spam”.
Why should you care?
WhatsApp co-founder and CEO Jan Koum is notoriously averse to advertising (having pledged the app would never become “just another ad clearinghouse”). So, what’s up with WhatsApp?
WhatsApp users have 30 days to opt out should they not wish to share their information with Facebook. Regardless, users’ messages will remain encrypted and private, and they won’t be subjected to third party banner ads.
But, as MarketingLand’s Tim Peterson makes clear, Facebook seems to be following the same three-step process used with Instagram. That is, after (1) finding ways to match users across Facebook and Instagram and (2) accumulating more data about each matched user, then (3) applying the data to improve ad targeting and content recommendations on both Facebook and Instagram.
Richer targeting data is, of course, like oxygen to advertisers.
Facebook gets to improve the relevancy of its advertising, benefiting Facebook users and advertisers alike. It will also, in connecting WhatsApp phone numbers with the data Facebook already has, be able to make better friend suggestions.
And, on WhatsApp, users will soon start hearing from businesses that matter to them. For example, WhatsApp says they might get a message from their “bank about a potentially fraudulent transaction” or be “notified by an airline about a delayed flight”.
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Jeremy is a Partner and Senior Consultant at SureFire. Jeremy has been working in search since 1996, when he joined the Australian search engine, LookSmart. After relocating to San Francisco, he was instrumental in the development of the company’s paid search ad platform. At analytics company Coremetrics (now owned by IBM) he established an in-house search agency managing campaigns for Coremetrics clients such as Macy’s, Bass Pro and Lands End. At Acxiom he managed members of the pioneering SEO firm Marketleap and worked with clients such as Capital One, American General Finance and Kaiser Health. Joining SureFire in 2009, he is the head of Paid Search Advertising and oversees the delivery of AdWords and other PPC campaigns. He also helps clients make sense of their website data.
