Mobile messaging is starting to look a lot like SaaS

With SMS costs many times higher than in the United States, 96% of Brazilian smartphone owners use WhatsApp.

Already the world’s largest mobile messaging app, WhatsApp has taken on a much broader position in Brazil as a major communications solution for entities ranging from SMBs to government agencies. For example, the city of Rio is using a WhatsApp channel to answer questions about the status of construction work affecting the city in preparation for this summer’s Olympic Games. Procter & Gamble uses WhatsApp to promote its Head & Shoulders line of shampoo through short videos of Brazilian soccer coach Joel Santana discussing the brand and using the latest products.

This success is being replicated elsewhere. In Hong Kong, for example, mobile messaging is being used to book reservations at restaurants and send news tips to local publishers. Later this year, the company announced that it will begin its first enterprise rollout by offering banks, airlines, and other businesses one-way messages to customers. Why is this important? First, consider the outsized levels of user engagement in mobile messaging relative to other mediums. 98% of mobile messages are opened. And it is estimated that over 3.6B people (half of the world population) will be using messaging apps in the next few years. For context, email open rates hover around 22%. Additionally, WhatsApp allows users to send messages for free regardless of their mobile carrier, making it a desirable tool for businesses looking to provide real-time customer support without investing in costlier SaaS offerings.

What does the future for mobile messaging look like? We believe that many of the most successful will become platforms for e-commerce, media and marketing. In order to reach this stage, artificial intelligence will be crucial.

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