Facebook has unveiled that nearly one million advertisers used its "click-to-Whatsapp" ads, and more than three million advertisers have used its "click-to-message" ads to date. These are ads that allow advertisers to add a "send message" button to their ad on Facebook that will open a conversation in WhatsApp and Messenger respectively when people click on it.
In an earnings call for the first quarter of 2021 ended 31 March, Mark Zuckerberg, CEO of Facebook, said the next step is to create click-to-WhatsApp ads from directly within the WhatsApp Business app. According to Facebook, businesses using the WhatsApp Business feature are sending more than 100 million messages per day. Over the last year, during the height of COVID, total daily conversations between people and businesses on Messenger and Instagram also grew by more than 40%.
According to Zuckerberg, commerce and business messaging are among Facebook's long-term opportunities that it is focused on. "Commerce has been growing on our services for a while, but it has become a lot more important as the pandemic has accelerated a broader shift towards businesses moving online. In the last year, we've seen online storefronts stay open even when physical stores closed, and going forward online commerce will continue to offer an increasingly personalised and convenient experience," he added.
He also said that commerce ads "continue to do very well" and drive a meaningful amount to Facebook's overall business, adding that more than one billion people visit Marketplace each month. Similarly, since its launch of Shops last year, there are now more than one million monthly active Shops and over 250 million monthly Shops visitors. Facebook is now investing in building for the future of commerce, Zuckerberg said.
Facebook's next step into commerce ads comes as the social media giant reported an advertising revenue of US$25,439 million for its first quarter of 2021, which ended on 31 March 2021. This reflected a 46% increase year-on-year, from US$17,440 million in 2020. "We are pleased with the strength of our advertising revenue growth in the first quarter of 2021, which was driven by a 30% year-over-year increase in the average price per ad and a 12% increase in the number of ads delivered. We expect that advertising revenue growth will continue to be primarily driven by price during the rest of 2021," Facebook said in its latest financial report.
Besides commerce and business messaging ads, Facebook is also looking to invest in AR and VR. One of its upcoming investments includes neural interfaces for interacting with AR. Additionally, it has also started testing its new avatar system, which Zuckerberg said will be a key part of how people express themselves and connect.
"I believe that AR and VR are going to enable a deeper sense of presence and social connection than any existing platform. They're going to be an important part of how we'll interact with computers in the future. So, we're going to keep investing heavily in building out the best experiences here, and this accounts for a major part of our overall research and development budget growth," Zuckerberg revealed. He added that over time, he expects AR and VR to unlock a massive amount of value, both in people's lives and the economy overall.
Earlier this month, Facebook also said it is building a set of new audio creation tools, and have been investing in audio technologies such as speech-to-text and voice morphing. It will be making these tools available in an audio creation tool directly inside the Facebook app. These audio tools include the ability to mix audio tracks, a growing collection of sound effects, voice effects and filters, Facebook said.
It is also beginning to test Live Audio Rooms, where Facebook users can host conversations with one another. The feature is slated to be available to everyone on Facebook and Messenger by mid 2021. The test will begin inside Facebook groups, allowing the communities already in place on Facebook the chance to engage through audio. Once it comes to Messenger, Facebook said it aims to provide a convenient in-app solution for friends to connect using voice alone.
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