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Do we need SMS 2.0 – or will WhatsApp do?

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In this time of global lockdown, most of us have become perhaps over familiar with WhatsApp – first as a way of sharing memes about lockdown when it was still a novelty and now as a vital link to friends, family and work colleagues as the madness of isolation starts to bite.

But you may also have seen how more and more brands and businesses are attempting to get you to engage with them – and indeed are trying to engage with you – using it.

This isn’t a coronavirus phenomenon: this is something that has been on the rise since way before we were ravaged by a pandemic. Brands have closely watched how the man in the street (or currently, the man in his living room) has embraced WhatsApp and its deep functionality.

The interactivity, the multi-media, the ease of use and above all the fact that it works on all smartphones, some tablets and even desktops is proving very attractive to users and businesses alike.

In fact, research by an analysts firm called Mobilesquared suggests that, with 2 billion WhatsApp users worldwide, WhatsApp business – the business version of the messaging service that can bring all manner of interactive benefits to brands – is already the most popular business messaging service out there.

Mobilesquared’s latest Databook and Report – the snappily titled “WhatsApp Business Messaging Traffic & Spend Forecasts, by country & region (2019-24)” – estimates that WhatsApp Business will experience unprecedented growth of more than 5,400% among medium and large businesses looking to use it to interact with consumers – up from just 992 at the end of 2019 to almost 55,000 by 2024.

In total, the company predicts that brands and businesses will spend $3.6 billion by 2024on WhatsApp Business. Much of this will be ‘inbound’ – so people talking to brands, not the other way round, and so it is likely to be a customer care tool – think using WhatsApp to talk to a company about your order, or to complain about something, book an appointment – probably by video call for the foreseeable future – and so on.

Already Hyandai India has turned to WhatsApp to handle all its customer care, using  WhatsApp Business for booking a car service, providing service updates, sending rich media content, sending repair invoices and capturing customer feedback. To build consumer trust and allow Hyundai customers to verify that they are interacting with an official account Hyundai uses a verified business profile on WhatsApp.

As an asynchronous channel – that is letting consumers send messages in to book things in layman’s terms – WhatsApp Business is convenient for consumers and allows customer service agents to handle more conversations at the same time.

According to Sudarshan Dharmapuri, EVP Products at IMImobile, which runs the system for Hyundai: “WhatsApp Business offers a new and more convenient way for consumers to communicate with brands. Hyundai recognizes the importance of embracing newer, effective digital communication channels to improve customer experience and create differentiation from their competitors. Conversational customer engagement, service and support present a huge opportunity for businesses, more so now than at any other time. We look forward to working with Hyundai to further optimize the customer service experience.”

Not the only game in town

With such mighty growth in use, you’d be forgiven for thinking then that WhatsApp was set to be the only game in town for interaction between brands and consumers and vice versa. Where we also talk to our favourite retailers and brands using social media and messenger, text, phone and iMessage, WhatsApp is pulling away as the channel of choice.

But Google has other ideas. Spurred on by the uptake of WhatsApp – and peeved that so many Apple users love iMessage – it has taken on the mantle of creating what it bills as Text 2.0. It wants a slice of the messaging pie and wants to do it by making text even better.

While many of us think that WhatsApp has already done that, Google’s proposed Rich Communications Service (RCS) has other ideas.

RCS is an easy-to-use, feature-rich, interactive, cross-operator – so it works like text, you can message someone from you Vodafone-connected phone who is on O2 – advanced messaging platform that will be available on all mobile devices. It is widely seen as an evolution of SMS messaging and not only incorporates advanced multimedia capabilities into text messages, but also gives users the ability to accomplish everything they currently do across multiple apps from a single messaging platform and with a single contact list for friends, family and services.

Google also stresses that RCS also serves as a powerful, private platform for direct marketing that operators can offer to brands. The idea is that people open SMS much more readily than they do email marketing and this will offer the same opening rate but with much better content – content that you can shop from and interact with.

So far, so good: but with WhatsApp already so established – and now so popular that world governments have been using it as their preferred comms channel to frightened citizens and subjects during lockdown – is anyone going to use WhatsApp?

Synchronoss, a global leader and innovator of cloud, messaging, digital and IoT products and the provider behind the RCS-based +Message service launched by three major Japanese operators in May 2018, asked focus group participants about their current messaging behaviour and introduced them to RCS capabilities. The resulting discussions demonstrated a clear demand for operator-sponsored RCS, with convenience and operator trust at the heart of participants’ excitement for this new form of mobile communication.

“When asked about their perception of messaging services today, participants perceive a clear distinction between ‘messaging’ and ‘texting’,” says Glenn Lurie, President and CEO, Synchronoss. “‘Messaging’ is reserved for messaging applications, such as Facebook Messenger, WhatsApp or Instagram, while ‘texting’ is considered to sit outside of this messaging arena and is a different activity entirely. For consumers, texting is fullproof.”

Room for both?

Experts believe that, while RCS hasn’t really got its marketing message straight yet, it is aimed at doing something very different to WhatsApp and that WhatsApp is simply doing ‘business’ in the absence of a decent business messaging platform.

For starters, RCS isn’t really aimed at being a personal messaging app: it has been developed to offer a range of services that will tickle the fancy 0f brands and businesses. WhatsApp is, currently, primarily a P2P messaging app that happens to have some business applications.

Secondly, Google wants to use RCS to bolster its core business – advertising – and so the key driver is going to be commercial. WhatsApp, owned by Facebook, is more a service in search of monetisation if it can get it.

That said, with more people using WhatsApp while in lockdown than ever before and with many new features likely to be added to it in the coming years, it will be interesting to see where RCS gets to.

The price is wrong?

Currently, GSMA figures suggest that some 88 operators have launched RCS services, with 403 million active monthly users. It forecast the market value would hit $74 billion by 2021.

But right now, that is a small slice of the 3 billion mobile users out there – and a faction of the 2 billion WhatsApp users predicted.

The thing that seems to be putting people off using RCS is pricing. There is something of a mystery around whether it is per campaign, per message, per interaction – and then what that cost might be to business.

The problem is that RCS isn’t like SMS – nor is it SMS 2.0. It encourages ongoing conversation and working out who pays for that between consumers and brands – especially if the message is initiated by the consumer to contact the brand as with WhatsApp.

Do we face a world where consumers have to have pay to complain? Or do brands have to stump up to allow consumers to converse with them?

The classic view that WhatsApp is in-bound and RCS is inherently outbound also raises the prospect of consumers using two messaging platforms to interact with brands – WhatsApp to talk to brands, and RCS to be marketed to.

Mobilesquared believes that a token-based system is how RCS will work. It suggests that a consumers would purchase a block of RCS tokens from their RCS provider or network operator and that different types of RCS messages would use different numbers of tokens.

If you were sending a simple image then you might use one token, but if you had a scrollable element, or button options, then you would use two.

How this would work in reality is unclear, as there will be almost infinite numbers of ways that an RCS message could be presented.

The whole pricing of business RCS is still in utter chaos and without a universally agreed approach, RCS simply can’t – and won’t – be used.

And with WhatsApp already now more firmly entrenched in the consumer psyche than ever thanks to the global pandemic and lockdown, it may be sometime before we see RCS – and we are unlikely to see RCS become SMS 2.0.

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