Lyris Connections Blog

Why Facebook’s $19 Billion Acquisition of WhatsApp is the Smartest Move it’s Ever Made

Feb 20, 2014 by

Before this week, it’s fair to say that recent Facebook news has been pretty grim. Many have predicted that it is about to fall to a death, with one source comparing the social network effect to that of an infectious disease and saying Facebook will lose 80% of its users in the next few years, and others predicting that by 2018 it will hold an insignificant number of active users.

Facebook users

Analyzing the demographics of its users shows that Facebook is still struggling to connect with the 13-17 year-old segment. In fact, 11 million young people have fled Facebook in the past two years. When questioned, many of its users said that they simply don’t want to use the same social networking sites as their parents, fearing snooping and seeking privacy and a more one-to-one, direct relationship tool. They simply want to hang out somewhere else, and that place is WhatsApp.

Facebook’s $19 billion acquisition of WhatsApp changes everything. It effectively means that Facebook has just snapped up the one segment it never really quite connected with. It has snapped up the one segment that arguably threatened the future of the social network – 450 million monthly active users, with the majority being in the age range that it has never really been able to quite connect with on the Facebook platform. The segment that has been leaving Facebook in “droves” is suddenly back on the radar, but at a cost that exceeds NASA’s entire budget for 2013.

What the WhatsApp acquisition means for marketers

WhatsApp initially says that there will be “no ads, no games, no gimmicks,” but I think we can all just about remember when Facebook was like that. In the future, we think this is likely to change.

 WhatsApp

If the way that Facebook has grown its advertising platform is an indication of what’s to come for WhatsApp, then things are about to get a whole lot more exciting for marketers wanting to take advantage of WhatsApp. But as with any Facebook marketing, it will come at a price.

Facebook will likely adopt a very similar advertising model to Facebook Advertising for WhatsApp, enabling marketers to use this channel in sequential messaging strategies to target individual users with content, and utilize very precise segmentation models through custom audiences. 

 What’s your take on the future of WhatsApp and the effect on digital marketing? Share your comments below.

Philip Storey

About the Author: Philip Storey

Philip Storey is Global Head of Strategic Consultancy at Lyris and has been specializing in email for a decade, working with brands to create engaging and response-triggering email for acquisition and retention strategies that drive high return on investment. He is also a trainer, speaker, and writer for several industry blogs such as Econsultancy and the IAB.

Leave A Comment