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Traditional online commerce often lacks the personal touch and real-time interaction that customers crave, leading to lost opportunities. People have an increasing preference for shopping through their familiar and convenient channels.
According to PwC some factors positively affect a customer’s sales journey, such as (see Figure 1):
- Easy mobile experience
- Fast and convenient purchasing process and checkout
- Using customer data to ease their decision process
- Efficient customer service
With its ability to enable conversational commerce, WhatsApp allows businesses to satisfy most of these customer expectations. In this article, we will explain WhatsApp commerce and its use cases and benefits for businesses.
Figure 1. Parameters that affect customer experience
Source: PwC
What is WhatsApp commerce?
WhatsApp commerce is the integration of business activities within the WhatsApp API. It is part of a broader trend of conversational commerce, which focuses on engaging customers through their preferred communication channels (mostly messaging apps) and enhancing customer experience through more personalized and immediate customer interactions.
Essentially, it’s about using the WhatsApp business platform not just for communication, but for a range of business operations, from marketing to customer service. WhatsApp Commerce allows for a more direct and personal interaction between businesses and their customers, in a context where the customers already spend a significant portion of their online time.
Also, it can offer upselling and cross-selling options that enhance the shopping experience and boost sales.
What is WhatsApp Commerce Policy?
WhatsApp’s commerce policy, as of October 25, 2022, sets guidelines for the use of commerce catalogs on the WhatsApp Business app or any other commerce experiences to sell goods or services.
According to the policy:
- Users must comply with the policies and prohibitions listed, as well as all applicable terms, laws, and regulations.
- Users are solely responsible for their transactions and for providing any sales terms, privacy terms, or other terms applicable to their interactions with other users.
- WhatsApp is not responsible for processing, paying for, or fulfilling any sales relating to user transactions.
- Users are solely responsible for determining, collecting, withholding, reporting, and remitting all applicable taxes, duties, fees, and additional charges for sales relating to their transactions.
For the extensive list of the prohibited products, you can check WhatsApp’s commerce policy page.
How can businesses use WhatsApp commerce?
WhatsApp commerce can be adopted by businesses across many industries, such as:
- Finance
- Banking
- Retail
- Insurance
- Travel & hospitality
1- WhatsApp Business App
WhatsApp business account is designed for small businesses and offers features like automated messages, quick replies, and labels to help manage conversations. It also includes a business profile where companies can share important information like their website, location, and contact details.
2- WhatsApp Business API
For medium and large businesses, the WhatsApp Business API allows for more advanced communication capabilities, like integrating WhatsApp messaging into their own systems or software. This can be used for automated notifications, support services, and more.
What are the use cases of WhatsApp commerce for businesses?
1- Customer support
Businesses can use WhatsApp to offer real-time, personalized customer support. Organizations can use Whatsapp to respond to inquiries, resolve issues, and provide assistance. Automated responses to common queries by using a WhatsApp chatbot can also be set up.
Figure 2. Example of a WhatsApp chatbot interacting with customers to boost sales
Source: Haptik
2- Product showcase
Businesses can use the Product Catalog feature in the WhatsApp Business app to showcase their products or services. Customers can browse through these directly within their WhatsApp conversation.
It can also assist buyers in making informed purchases by contrasting two products within the same category.
3- Product recommendations & shopping assistance
Businesses can also use WhatsApp as a commerce platform to offer product recommendations to their customers. By using the customer’s browsing behavior and purchase history, they can:
- Make personalized suggestions on products and services
- Promote new products
- Suggest bundled products and offers
- Offer shopping assistance
Figure 3. WhatsApp chatbot provides booking recommendations
Source: Haptik
4- Order updates
Businesses can send updates regarding the status of an order, delivery details, or tracking information via WhatsApp. This can streamline communication and improve the customer experience.
5- Marketing and promotions
WhatsApp can be used to send promotional messages, updates about new products or services, or other marketing content to customers who have opted to receive such messages.
6- Transactions
Where available, businesses can use WhatsApp Pay to accept payments directly within WhatsApp, making the purchasing process more seamless for customers.
What are the benefits of WhatsApp commerce for businesses?
1- Direct communication
WhatsApp allows businesses to communicate directly with customers in real time. This can improve customer service, enhance relationships, and drive engagement.
2- Personalization
Businesses can offer personalized customer experiences through one-on-one conversations, tailored product recommendations, and personalized updates.
3- Global reach
With over 2 billion users worldwide, and also being the most popular messaging app across the world, WhatsApp offers businesses the opportunity to reach a global audience (see Figure 4).
Figure 4. Most popular global mobile messenger apps as of January 2023
Source: Statista
4- Cost-effective marketing
Sharing updates, promotions, and news through WhatsApp can be a cost-effective way to engage customers.
5- Improved customer service
The platform allows for real-time customer service and support, enabling businesses to promptly address queries and issues.
6- Ease of use
Many customers already use WhatsApp in their daily lives, so using it to interact with businesses can be intuitive and convenient for them.
7- Product discovery
The product catalog feature in the WhatsApp Business app allows businesses to showcase their products or services, aiding product discovery.
8- Transaction convenience
In regions where it’s available, WhatsApp Pay can make the purchasing process more seamless by allowing transactions directly within the app.
9- Automated responses
Businesses can automate responses to frequently asked questions, improving efficiency and ensuring customers get timely answers.
10- Data analysis
Through WhatsApp Business API, businesses can track and analyze communication data to gain insights, improve their services, and make informed decisions.
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Cem has been the principal analyst at AIMultiple since 2017. AIMultiple informs hundreds of thousands of businesses (as per similarWeb) including 55% of Fortune 500 every month.
Cem’s work has been cited by leading global publications including Business Insider, Forbes, Washington Post, global firms like Deloitte, HPE and NGOs like World Economic Forum and supranational organizations like European Commission. You can see more reputable companies and resources that referenced AIMultiple.
Throughout his career, Cem served as a tech consultant, tech buyer and tech entrepreneur. He advised enterprises on their technology decisions at McKinsey & Company and Altman Solon for more than a decade. He also published a McKinsey report on digitalization.
He led technology strategy and procurement of a telco while reporting to the CEO. He has also led commercial growth of deep tech company Hypatos that reached a 7 digit annual recurring revenue and a 9 digit valuation from 0 within 2 years. Cem’s work in Hypatos was covered by leading technology publications like TechCrunch like Business Insider.
Cem regularly speaks at international technology conferences. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School.
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