Suiting the messenger

When it comes to rising ad formats and ad channels there is no pinpointing where the tide will turn, although we do know that smartphone users around the world are spending more time on messenger apps—so this trend indicates an opportunity for mobile advertisers. According to Statista, 2.01 billion mobile phone users globally, accessed over-the-top messaging apps to communicate in 2018, a number that is projected to grow to 2.48 billion users in 2021.

In APAC, messenger apps already dominate the market: in South Korea, a country of 50 million, KakaoTalk counts 32 million local users who can spend 850 minutes on KakaoTalk in a month. This is unsurprising, considering that the app includes everything from gaming to transportation and food delivery services. When it comes to ads, local brands tend to offer exclusive incentives via the app either with a notice on their page or by sharing message updates with followers at a cost. Most advertisers wishing to launch in South Korea would hugely benefit from the support of KakaoTalk. The same applies to China with the hugely popular WeChat, counting more than 1 billion monthly active users globally. 

Messenger advertising opportunities

Messenger chats are dominating the market. In August 2018, WhatsApp Messenger was the most downloaded app for Android users globally and is being used by 450 million people daily on both iOS and Android. WhatsApp is followed by Facebook Messenger; which now engages 1.3 billion people globally and it’s the leading app in the US with 126.3 million users. Both platforms are owned by Facebook, with 2 billion users (and counting).

Since January 2018, Facebook allows users to post Instagram Stories directly to WhatsApp, thus opening up the possibilities of cross-platform advertising in due course. As Facebook turns increasingly to businesses, we predict it’s only a matter of time until both WhatsApp and Facebook Stories also offer more advertising channels/feeds, similarly to the APAC market.

Recently at the DMEXCO 2018 ad tech industry conference, Dr. Florian Heinemann of Project A Ventures and Stan Chudnovsky, Facebook’s VP of Messenger, led a discussion about the rising opportunity for brands to connect with consumers through messaging apps at scale and in a way that is both personal and contextual. “As people-to-people conversations are working so much better on messaging, there are all the reasons in the world to believe that people-to-business conversations would also be better on messenger platforms” argued Chudnovsky.

“Messaging is a big part of people’s lives and when ‘conversations’ happen in one place, businesses want to be a part of it," he added. People prefer to reach out to businesses via Messenger rather than to stay on hold on the phone. 

Creating 'conversations' that engage 

Advertisers can build different experiences within Facebook Messenger apps using bots. Customer service team can greatly benefit from in-app conversations with customers as a part of their CRM strategy. For instance, KLM sends 15% of boarding passes to customers via Messenger. Additionally, KLM just announced that passengers can now use augmented reality (AR) through its Messenger app to check whether their hand baggage is the correct size before packing for a trip.

'Conversations' between consumers and businesses are more instant and real-time, since updates like a change of the gate or a flight delay can be shared more easily. Another upside is practical: conversations can be found and traced on one single thread, so it’s an ideal customer journey tool to communicate throughout, without the need to authenticate oneself again and being there for people when they have issues. In addition, you can also retarget those customer threads for re-engagement.

Overall, messenger apps can enhance web experiences; CRM marketing and also support new user acquisition. Examples of success stories are by the Bundeswehr (German army) who were early adopters and are achieving good results; as are a number of insurance companies that show 30 to 40% higher completion rates and conversions, compared to owned-website experiences. This shows the potential of messenger apps turning into super apps where you can shop, do your daily tasks and message your contacts: from friends to companies.

Without a doubt, messenger apps pose an interesting new channel for advertisers to explore now, or in the near future as this channel matures. Big and small consumer-facing brands are already beginning to experiment with messaging as part of their marketing strategies—and with eight billion messages are exchanged between people and businesses each month, there is a lot for advertisers to learn from these experiences.

Surely, it’s better for advertisers to start early and test the waters, before the challenge will turn to standing out creatively and getting a hold of high-value users in a highly saturated channel. What’s important right now is for brands to realize the opportunities that social platforms are opening up to them, the importance of messenger apps in the everyday lives of their target customers, and the power of a successful and well-integrated messenger campaign as a marketing tool.

Markus Malti is co-founder and managing director of mobile adtech firm WeQ