The Future of Connection
The tech world is still abuzz around Facebook’s recent acquisition of WhatsApp and its lofty $19B price tag, and the key themes presented in Barcelona at the Mobile World Congress last week only confirm that real-time messaging is taking over communication, as we know it.
Whether you think WhatsApp is worth $19 billion or not, the fact is that rich, real-time, digital communication has a major impact in the world and the potential to become more important than the Internet itself. Imagine a world where everyone is always connected, everywhere they are – this world is imminent and brands need to be prepared.
As a SaaS pioneer in real-time communications, I’ve been avidly observing this space for quite some time and the pace of change has been astounding. During my business travels, I’ve spent a great deal of time in Asia meeting with innovators and leading eCommerce brands, and the advancements I’ve seen in this region have been remarkable. Asia has been quietly emerging as an incubator for this type of technology, and although WhatsApp is the dominant player in the space and based in the US, there are a number of exciting companies poised for perhaps even greater growth heating up in Asia. The major players include WeChat from China (272 million users) and Kakao Talk from Korea (133 million users) that are both quickly gaining adoption beyond Asian borders. Another company that is particularly exciting is called LINE, which was developed by a Japanese unit of Korean Internet search giant Naver, and has 350 million registered users. They are estimated to be adding 20 million users a month and have a revenue stream of around $600 million. This company could have the potential to disrupt both Facebook and WhatsApp when it fully enters the U.S. market this year.
What is the greater impact of this trend, and why is the messaging wave important for brands?
For businesses, there are three key points we should be considering when we look at the potential impact of this communications shift:
1) Speed and Scale:
The speed of scale and adoption of this technology is incredible. If you look at disclosed numbers, these major messaging platforms alone have up to 1.3 billion users. There are nearly 2.7 billion people on the internet today, 18 years later, and messaging technology has penetrated more than half that number in about 3 years. This handful of messaging companies virtually holds the keys to connecting with consumers today.
2) Voice is fading:
Messaging has emerged as the dominant form of communication globally. This shift in consumer behavior began with Short Message Service (SMS) and then onto richer forms of messaging with the advent of smartphones. What has helped to fuel the growth of companies like WhatsApp and LINE are the costs of using SMS in Asian and European markets. These platforms offer an attractive alternative especially in this WiFi era. There is now a generation of people out there who rarely use the phone for talking, but are fluent in Emojis and 7 second videos for self-expression. This young generation is the next generation of buyers, and they live in these digital channels.
3) The Next Wave for Commerce:
These messaging services are more than a communication channel-- they are powerful platforms for commerce. While US based services have yet to crack the commerce puzzle, a majority of these Asian companies launched their messaging services with a commerce strategy in tow. These companies grew up in mobile-first economies, where mobile penetration not only outpaced Internet growth, but dominates consumer activity. Asia is miles ahead when it comes to the mobile economy, whether it’s commerce, payments, and other innovations. Once Western markets catch on, the implications will be tremendous.
The LivePerson Vision
From a strategic perspective, LivePerson is sitting in a very unique and powerful position. Every month 22 million people use our platform to connect via chat with their favorite brands to get help, buy a product or service, or ask an important question. While companies like WhatsApp are powering communication between friends and family, we are powering communication between a business and its customers. It has been our mission from day one to provide this type of rich, real-time connection between a customer and a brand, and it’s exciting to see that the demand for this type of digital connection is growing. Our new platform, LiveEngage, enables brands to provide this type of real-time one-to-one connection to their customers across all digital channels.
As we continue to strengthen and roll out the LiveEngage platform, we are devoting time and care to the consumer experience. Our web-based engagement windows and the “Embedded Window”(coming soon!) will integrate chat, video, voice and content into an innovative and seamless engagement experience for the consumer. We will also continue to focus on enriching our mobile capabilities, so brands can provide a compelling experience to this WhatsApp generation.
The digital commerce experience has stagnated and has not changed since the 1990s. Early on, search companies like Google have set the rules on how a website should be created—in this model, a successful website is dictated by heavy “optimized” text and images. It’s interesting that an advertising vehicle like Search could dictate how a retailer creates its online store. There is no parallel like this in the offline world and it should not be this way in the digital world.
Because of current limitations of the Internet, mobile will lead the way to eCommerce transformation. Since there are fewer inherent barriers in mobile digital commerce, we are already seeing exciting innovations in mobile shopping. From “augmented-reality” shopping guides or personalized shopping apps based on personal photos and social-media integrations, the mobile commerce is experience is shaping to be truly imaginative and powerful.
I fundamentally believe that there will be a set of platforms that will enable digital commerce to flourish and LivePerson is in a great position to lead the way. We are committed to rethinking the digital shopping experience and how people connect with brands and create meaningful and long-term relationships. We will continue to work with our base of over 8,500 customers, including some of the largest brands in the world, to shape the future of digital commerce. Most importantly, LiveEngage will provide us with the platform to deliver on this vision.