Messaging apps are about to make it rain
If you’ve ever run SMS campaigns, you know how important messaging apps will be.
Until around 2010, SMS was a pretty popular form of advertising. It did a great job driving foot traffic and revenue at physical stores. We tracked performance by providing a unique discount code in each SMS message, which was recorded at registers at retail. In terms of revenue generation, SMS often outperformed every other medium.
But SMS was very expensive. As SMS rates went up and people moved toward free messaging apps, brands decreased their SMS spend. Plus, receiving SMS without social context or cool content, from a random number that had no avatar or profile photos or ability to interact…well, it was super lame. Especially when compared to social media, which was blooming and just introducing ads.
Today, new messaging apps like WeChat (355m users) and Line (400m users) fuse the precision of SMS with the dynamics of social media. But, of course, they are a lot less expensive. For SMS today, you pay around 5 cents per message. Line charges advertisers 1 cent per message.
Modern messaging apps will also be more effective due to the evolution of mobile commerce. Brands can deep link from messages to product pages on their commerce enabled mobile apps, making the path to purchase pretty simple.
Better yet, WeChat has just introduced the ability for brands to set up shop and sell items directly inside the app. No linking necessary. This verticalization provides the best user experience — why force users to leave the app if they can buy within it? You’ll still get their personal info when they check out. Salesforce is already building the CRM system to help you organize and segment your messaging app customers (see image below).
As messaging apps start to monetize more than just stickers and games, they’ll leverage what they do best: communication. Providing one-to-one interaction at scale will deliver great revenues… for both advertisers and messaging networks.
Agree/disagree? Hit me at @jasonwstein.
