The WhatsApp Ecosystem

Earlier this month Facebook held it’s annual developers conference and announced a couple of interesting developments for WhatsApp. Wait, what? What does Facebook and WhatsApp have to do with each other?

First let’s clear the air, Facebook has been getting raked over the coals this past year for a wide variety of issues. Then a couple of weeks ago, one of Facebooks co-founders, Chris Hughes, had an op-ed piece in the NY Times about breaking up Facebook. How many internet properties does Facebook actually have?

Surprisingly many people don’t realize that Instagram and WhatsApp are both owned by Facebook and the 3 properties together: Facebook, Instagram and WhatsApp are a social media 800 pound gorilla.

Back to WhatsApp and those interesting features they mentioned at the Facebook Developers conference. One of the biggest features is WhatsApp Product Catalogs, where users can see what products are available from a brand. This has an immense impact on SMEs that want to sell directly without going through an e-commerce platform like Amazon or Flipkart.

When I first heard about the upcoming feature I didn’t think much of it till a week ago when my wife purchased some products on Amazon.in from a brand she discovered called Pure Elements. Pure Elements is based in Mahabaleshwar, Maharashtra and uses Amazon’s Fulfillment by Amazon (FBA) service. Which means Pure Elements sends their products to Amazon’s warehouse and Amazon takes care of the warehousing, picking, packing and shipping of the product.

We received the order from Amazon and immediately realized there was an error in the shipment. Surprisingly, there was no easy way to tell Amazon that the wrong size of the product was sent. So instead, I sent an email directly to Pure Elements and they promptly fixed the issue and said that next time I should order directly. In the future with WhatsApp Product Catalogs and in-app payments via WhatsApp Payment, I could see myself contacting them directly and getting the products. And if there are any issues I can chat with them directly on the WhatsApp platform.

Currently, the alternative is that an SME needs their own company website with some dodgy payment gateway which invariably is a pain for an SME. Which is the reason why many SMEs in India prefer to use WhatsApp today for commerce even though it’s not as streamlined as it can be. These new WhatsApp features would work well for an SME such as a home baker who sells cookies and cakes.

This brings me to the ecosystem part, imagine if that SME is only going to sell via WhatsApp, then they would only need a CRM (customer relationship management) and a shipping partner. If they made it simple enough for an SME to connect to these external providers it could change the landscape. Yes, WhatsApp does have something called Business API but that’s for larger companies that have a tech team in-house.

I’m thinking something along the lines of WordPress and their entire plug-in community where users can add features to their WordPress website very fast and more importantly without any deep technical skills. A WhatsApp Plugin ecosystem could grow WhatsApp commerce transactions exponentially and spawn many new startups helping SMEs sell more through the WhatsApp platform.