After conducting tests in Thailand and Australia, Facebook has announced that it will start displaying ads on its Messenger app. In a blog post, the Palo Alto, California-based tech company revealed that the effort would start on a small scale before being widely rolled out. Currently Facebook allows businesses to send ads or sponsored content to those Messenger users who have been in touch with them.
“[Advertising is] not necessarily everything, but it’s definitely how we’re going to be making money right now. There are some other business models we are exploring as well, but they’re all around ads one way or another,” said the chief of product for Messenger, Stan Chudnovsky, in an interview with VentureBeat.
According to the social media network, the marketing material will be displayed in a tab on the main inbox in between chat threads. The ads will therefore not appear in conversations. Users who click on the displayed ads will be redirected to a chat window or the website of the advertiser. Design of the ads will be customized to suit individual users just like is the case on Instagram or Facebook’s main app. To buy ads, advertisers will be required to use Facebook’s dedicated ad manager. Ads that are meant to appear in Home tab will be sold via auction.
The move comes at a time when ads served through the main app of Facebook are expected to decline and the revenues from Messenger will therefore serve to shore up sales. Currently, approximately 85% of the ad revenues that the social media network generates are derived from mobile.
By introducing ads to Messenger, Facebook will get nearer to its aim of linking the 70 million business organizations that are on the social network with users who now number approximately 1.2 billion. This also comes at a time when customer service is increasingly shifting to chat. Consequently, competition has also increasing in this space.
During the Worldwide Developers Conference which was held last month, Apple unveiled Business Chat which aims to link businesses with customers. Expected to be available in iOS when it is released in fall, Business Chat allows businesses to deploy their bots in iMessage or to make sales. Microsoft has also made it possible for users to chat on Skype with any website or business. At the same time Microsoft also made it possible for businesses to publish bots on Bing. Twitter has also embarked on similar efforts.