Organic interaction with businesses gives Messenger a much more personal touch than competing chat apps
Getting businesses to sign up for Facebook Messenger probably won’t be all that difficult, especially considering the enormous amount of companies already using Facebook and the success of FB’s ad campaigns.
The real challenge, however, will be convincing users to voluntarily allow businesses to proactively contact them with marketing content, as one of the fundamental truths in life is people are always receptive to the whims of salesmen. Hey, I said it would be a challenge.
Can Slow and Steady Win the Race?
Zuckerberg remains hopeful that by easing people into it, they won’t object to receiving marketing communication from businesses on Facebook Messenger. The plan is to eventually charge businesses for this capability.
Considering the success of this methodology on the News Feed, there’s a solid chance that Facebook Messenger will see similar — if not more impressive — success, which will ultimately trickle down to FB stock in the form of increased earnings and higher trading prices.
The name of the game here is patience.
Zuckerberg displayed his knowledge of this territory when he rejected the notion of blanketing the FB News Feed with banner ads, and his push for actual communication between businesses and consumers isn’t totally uncharted in the social media space.
Users are already comfortable interacting with businesses on Facebook, having become accustomed to ads and videos populating their News Feed. Slowly integrating the same into Messenger wouldn’t be much of a stretch, assuming the evolution occurs in much the same way.
At Facebook’s annual shareholder meeting in June, Zuckerberg announced that a FB accounts is no longer required to use Facebook Messenger. The decision made sense, with more than 700 million people worldwide using the chat app on a regular basis. It also raised questions about the viability of a standalone Facebook Messenger. Forbes stated, “Revenue from texting on chat apps … will make up just 1% of all the revenue generated by SMS and chat traffic in 2019.”
Forbes’ analysis, however, failed to consider Zuckerberg’s process of introducing organic interaction, followed by paid access to individual users in the future. And according to Facebook’s CFO, Dave Wehner, the vast majority of Facebook Messenger users also have a Facebook account, “so Messenger-only usage is not having a material impact on our overall usage stats.”
Considering the success of this methodology on the News Feed, there’s a solid chance that Facebook Messenger will see similar — if not more impressive — success, which will ultimately trickle down to FB stock in the form of increased earnings and higher trading prices.
The name of the game here is patience.
Zuckerberg displayed his knowledge of this territory when he rejected the notion of blanketing the FB News Feed with banner ads, and his push for actual communication between businesses and consumers isn’t totally uncharted in the social media space.
“The playbook that we’re going to run with Messenger and WhatsApp is kind of similar to how we thought about building a business in Facebook and Newsfeed. Where if you go back to 2006 and 2007, there were a lot of people who were encouraging us to just put banner ads and inorganic content into the experience, and what we decided was that over the long term, the ads and monetization would perform better if there was an organic interaction between people using the product and businesses.”Having already demonstrated the advantages of legitimate interaction between individuals and businesses on News Feed — for both advertisers and FB stock investors — Zuckerberg’s plan to monetize Facebook Messenger in the same way is little more than an extension of the existing platform and methodology.
Users are already comfortable interacting with businesses on Facebook, having become accustomed to ads and videos populating their News Feed. Slowly integrating the same into Messenger wouldn’t be much of a stretch, assuming the evolution occurs in much the same way.
At Facebook’s annual shareholder meeting in June, Zuckerberg announced that a FB accounts is no longer required to use Facebook Messenger. The decision made sense, with more than 700 million people worldwide using the chat app on a regular basis. It also raised questions about the viability of a standalone Facebook Messenger. Forbes stated, “Revenue from texting on chat apps … will make up just 1% of all the revenue generated by SMS and chat traffic in 2019.”
Forbes’ analysis, however, failed to consider Zuckerberg’s process of introducing organic interaction, followed by paid access to individual users in the future. And according to Facebook’s CFO, Dave Wehner, the vast majority of Facebook Messenger users also have a Facebook account, “so Messenger-only usage is not having a material impact on our overall usage stats.”
Bottom Line on Facebook Messenger and FB Stock
Monetizing Facebook Messenger to a point where revenue from the chat app actually impacts FB stock is going to take quite a long time. In the long run, though, FB will realize significantly more revenue than competing chat apps that generate revenue selling silly digital stickers and comical themes to users.
Real organic communication is worth much more, and while it will take some time before Facebook Messenger users are comfortable chatting with businesses, that day will indeed come, which will be followed by the installation of some type of paid-only access system for those businesses. That, in the end, will be the real measure of the success of Messenger monetization and its positive impact on FB stock.
Article originally appeared on InvestorPlace (08/04/2015)
Real organic communication is worth much more, and while it will take some time before Facebook Messenger users are comfortable chatting with businesses, that day will indeed come, which will be followed by the installation of some type of paid-only access system for those businesses. That, in the end, will be the real measure of the success of Messenger monetization and its positive impact on FB stock.
Article originally appeared on InvestorPlace (08/04/2015)
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