Businesses in India such as BigBasket, Swiggy and HouseJoy are quietly signing up for a Facebook feature that allows them to target, connect, and transact with customers on Messenger, the social media giant’s instant messaging platform.
The new feature, announced last year and introduced in India just before Diwali, allows anyone with a Facebook and Messenger account to browse through catalogues, make purchases, and complete payments.
“(We) just launched it recently… in time for Diwali, but this will be a year-round feature going forward… It will lead you to a mobile page or the app if you have one,” said Vipul Parekh, co-founder at online grocer BigBasket, adding the offering was not a bot as is commonly used on chat platforms.
Based on analytics, BigBasket can target notifications precisely at Messenger users. The notification comes with two options: accept and reject. If the user accepts it, he or she can browse through BigBasket’s entire catalogue, select items, add to cart, and make the payment — all while staying inside the Messenger app.
Online home services company Housejoy and food delivery startup Swiggy are also using Messenger to connect with consumers.
Housejoy wants to take the Messenger experience to a different level, said Sekhar Sudhamsh, senior product manager at Housejoy. “We started this just three days ago… In the next few days we will launch a chatbot on Messenger,” he said.
Similar to BigBasket, the user will get a notification from Housejoy, asking for permission for further communication. Once the user accepts it, he or she will be able to call for an electrician or a plumber, schedule the appointment and make a payment, explained Sudhamsh.
“There are lots of people who are not okay with browsing through the menu. For them a simple chat interface works,” said Sudhamsh. “You can integrate the website as well as have a chatbot and continue to interact with customers. It doesn’t have to be either-or.”
It is too early to measure the impact on sales or engagement of these businesses on Messenger.
Messenger vs Whatsapp
Businesses see messaging as one of the most important and frictionless ways to connect with its customers. Market tracker Statista predicts messaging app users in India will grow 73% – from 133.1 million to 230.5 million users – between 2016 and 2020. (This is lower than numbers that messaging apps put out today.)
Couple that with social media data and business potentially have a new sales channel. According to Statista, social media users will grow from 168.1 million in 2016 to 338.18 million in 2021. Facebook alone will have 319 million users in India by 2021.
As Facebook opens up the Messenger for businesses to connect with customers, it opens up a rivalry with WhatsApp, part of Facebook’s family of apps.
WhatsApp, which counts India as its largest market with a user base of 200 million, is looking at making money off its platform here first and, eventually, globally. Facebook claims 217 million monthly active users in India, including on the desktop, of which 212 million are on the mobile.
Companies such as BookMyShow, Ola, OYO, among others, are already using or are in the process of using WhatsApp as a channel to reach out to customers.
FactorDaily reported on Tuesday that Whatsapp is readying to launch UPI-based payments by the end of the year, which will allow users to make payments through the messaging platform.
To an extent, Whatsapp and Messenger both would be perhaps eying the same set of customers. Globally, the Messenger platform has evolved for businesses. An Uber ride can be hailed through the Messenger. Walmart, Hyatt and KLM Airlines are few of the other large brands who use Messenger.
Facebook did not respond to questions sent by FactorDaily. Facebook’s data shows two billion messages being exchanged monthly between users and businesses globally.
RoI on Messenger is key
There is one place where Messenger scores over Whatsapp, and that’s targeting the buyer. “Based on a bunch of inputs, we send notifications to user on Messenger, which Facebook helps us to do,” said Housejoy’s Sudhamsh.
These are based on the user’s gender, location, interests, and other parameters. This is not available with Whatsapp as the communication between the sender and the receiver is fully encrypted, and Whatsapp says it doesn’t know the content.
Targeted messaging brings down the cost of customer acquisition for companies, said Sanchit Vir Gogia, chief analyst and founder of Greyhound Research. “Because of the high installed base of Messenger, a brand can easily reach out to a large set of customers, which is otherwise almost impossible,” he said.
But there are risks, too. Brands have to make sure that the data that Facebook collects through the Messenger is safe and not sold to its competitors. “If people are chatting on Facebook Messenger and even making payments, Facebook will be collecting a lot of data and intelligence,” said a CEO of a digital marketing agency, who doesn’t want to be named.
As branding budgets get squeezed, marketing heads of companies are looking at better and quicker return on investments. “Companies might ask for quick outcomes. Will Facebook put its skin in the game remains a question mark… Accountability of marketing budgets is important,” said Gogia.
Subscribe to FactorDaily
Our daily brief keeps thousands of readers ahead of the curve. More signals, less noise.
Visuals: Nikhil Raj
Disclosure: FactorDaily is owned by SourceCode Media, which counts Accel Partners, Blume Ventures and Vijay Shekhar Sharma among its investors. Accel Partners is an early investor in Flipkart. Vijay Shekhar Sharma is the founder of Paytm. None of FactorDaily’s investors have any influence on its reporting about India’s technology and startup ecosystem.