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Mobilesquared’s Chief Analyst Nick Lane shares insights and forecasts on how many enterprises will have adopted WhatsApp’s Business messaging platform by 2024, and how it will perform comparatively to SMS and RCS Messaging.

WhatsApp Business is the most in-demand messaging channel right now among the business and brand community. Every WhatsApp Partner (aggregator) we have spoken to as part of our on-going research into business messaging tell us that they are receiving endless enquiries from companies wanting to know about WhatsApp Business, attracted to the 2 billion users that the platform now boasts. But how many companies are actually using WhatsApp Business?

By the end of 2019, we estimate there were just under 1,000 companies using the WhatsApp Business API – 0.05% of the available medium and large enterprises worldwide. Mobilesquared expects this number to rise to 2.5% of the available medium and large enterprises by the end of 2024, representing a total of almost 55,000 organisations, a growth of over 5,500%.

The WhatsApp Business App serves the micro and small businesses. At the end of 2019 we calculated that 5.25 million companies were using the App, representing a 5% conversion of the 100+ million downloads of the App from the Google Play store. Over the forecast period we expect this figure to grow 28% to 6.72 million by the end of 2024 – based on existing App growth over the last 18 months.

  What we expect to emerge in the coming years is that outbound traffic will be dominated by SMS and RCS, while inbound traffic will be split between WhatsApp, ABC and RCS, with WhatsApp likely to become the dominant force

In the meantime, traffic generated by micro and small businesses (a blend of outbound (A2P) and inbound (P2A) messages) will account for 70% of total WhatsApp Business traffic, with medium and large businesses restricted to inbound P2A communications only. During 2021 API total traffic will surpass App traffic and by 2024 traffic will account for 95% of total traffic.

The WhatsApp Business App is free to use for micro and small businesses, but there are monthly and messaging costs to medium and large enterprises using the API. Mobilesquared calculates that this generated spend of $38.7 million in 2019, and will grow to $3.6 billion by 2024 – a CAGR of 151%. Typically, WhatsApp will receive 35% of spend, with 65% split between the WhatsApp partners.

The 10 markets with the largest spend (India, Brazil, Germany, South Africa, Mexico, USA, Argentina, UK, Russia and Italy) together, accounted for 68% of total enterprise spend.

What we are starting to identify from our data is that SMS will continue is dominance in the A2P, space, and this will be boosted by the widespread emergence of RCS.

But right now, we believe WhatsApp is in a very dominant position in terms of P2A communications between a consumer and a brand. Originally, our data for RCS indicated the majority of traffic over RBM would be P2A by 2022 onwards, but in our latest forecasts, P2A as a % of total traffic in 2023, has dropped to 18%.

WhatsApp (and Apple with ABC) have clearly targeted the customer care model. Data shared by LivePerson suggests that around $1.2 trillion will be spent by brands on call centres in 2020.

What we expect to emerge in the coming years is that outbound traffic will be dominated by SMS and RCS, while inbound traffic will be split between WhatsApp, ABC and RCS, with WhatsApp likely to become the dominant force.

We are yet to research and model the impact Covid-19 will have on the messaging sector. But there is circumstantial evidence of a surge in consumer activity in WhatsApp around the world as people and groups look to stay in touch during this global lockdown. And Businesses can get in on the act as well.

Potentially, what we might see is a fall of around 25% of micro and small businesses from the total of WhatsApp Business App users in 2020, but then see an acceleration of the dormant businesses that had downloaded the App but yet to use it, kickstart their strategy, as well as a surge in companies looking to use the app, and most likely the API as well.

Nick Lane

Chief Insight Analyst


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