Facebook backtracks on plans to monetise WhatsApp with advertising

David Murphy

Facebook has abandoned plans to sell ads in WhatsApp, the Wall Street Journal reports, citing as its source “people familiar with the matter.”

WhatsApp was acquired by Facebook in 2014 for $19bn (£13.9bn), and WhatsApp founders Jan Koum and Brian Acton publicly expressed an aversion to allowing ads on the service. Indeed, in a blog post following the acquisition, Koum wrote that the deal would not have happened if WhatsApp "had to compromise on the core principles that will always define our company, our vision and our product". In 2016, they changed WhatsApp’s terms of service to forbid displaying ads in the app. Both have since left the company. Acton left in September 2017 and Koum in May 2018 in the midst of the Cambridge Analytica scandal.

According to the WSJ report, WhatsApp has disbanded a team that had been assembled to look at how best to integrate ads into the platform. Code they had written in support of the initiative has since been deleted. So while WhatsApp currently boasts 1.5bn users, Facebook has still not worked out how to make money from it, having scrapped the $0.99 annual subscription fee that was in place prior to its acquisition of the company. Perhaps its best hopes lie in monetising the potential WhatsApp offers for businesses to use it as a one-to-one communications channel with consumers, a relatively new field, but one that some forward-thinking companies are beginning to exploit.

The results of a study commissioned by marketing technology company, Pure360, suggest that Facebook’s decision is the right one. It commissioned research consultancy Censuswide to carry out two nationally representative samples of British adults, the first, in August 2019, with 2,000 respondents, the second, in October 2019, with 2007 respondents. Only 5 per cent of respondents said they would be open to receiving marketing messages from brands, including those they have not shopped with previously, on their WhatsApp channels during the working day, while only 9 per cent said they would be happy to see ads on WhatsApp that were relevant to them, from brands they had previously engaged with.