WhatsApp Business has emerged as a prominent channel for business-to-customer (B2C) communication, offering swift online messaging via smartphone, laptop, desktop, tablet, and even smartwatches. The platform's popularity is evident by its 2 billion monthly active users who exchange 100 million messages each day. With businesses keen to leverage this user base, WhatsApp Business facilitates meaningful one-on-one conversations that lead to successful conversions.
In Marketing, 67% of respondents report that WhatsApp led to higher conversion rates than alternative channels, and we want businesses to continue to focus on these high ROI marketing use cases. – Meta
To align pricing with the platform's features and usage, Meta has announced a change in its pricing model effective June 1st, 2023.
WhatsApp Business Platform in a Nutshell
Before diving into the pricing model changes, it is worth understanding how the WhatsApp Business Platform operates.
Meta recognizes two types of conversations on the WhatsApp Business Platform: user-initiated conversations and business-initiated conversations. Business-initiated conversations always start with pre-approved message templates.
A messaging session can start with a user-initiated or business-initiated message. When a messaging session starts, your business has a 24-hour conversation window or customer care window. As a business, you can interact with customers if they continue to interact with you for up to 24hr after the last customer interaction. Within the session, you can personalize and/or automate the conversation with templates, customer care employees, and chatbots as you wish (within reason, of course).
Once the conversation window closes, businesses can send business-initiated messages to restart conversations with customers who have actively opted in.
This setup facilitates a personalized conversational experience that customers desire, allowing businesses to offer services, support, and enticing deals in a tailored environment to boost revenue.
Current Pricing Model
Until June 1st, 2023, the WhatsApp Business pricing model is conversation-based. This means a fee will be charged per conversation (24hr window) rather than per (Template) message sent.
Businesses are charged once per 24-hour conversation, without added charges for any additional messages from the business or the customer. The fees differ depending on who initiated the conversation.
New Pricing Model Starting June 2023
On June 1st, 2023, WhatsApp is introducing a new pricing model. This pricing model will also be conversation-based, but adds more depth to the different business-initiated conversations throughout the customer journey.
Meta strives to deliver the ultimate customer journey on WhatsApp Business, allowing businesses to communicate with their customers at multiple touchpoints and for various use cases. Whereas WhatsApp Business used to focus on service exclusively, they now also offer marketing messages, notifications, and many more exciting features.
So... what is going to change? And how will it benefit your business?
To align the pricing model to its vision, Meta is introducing four conversation categories:
Because business-initiated conversations always start with message templates, the template used will determine the conversation type of (24hr) conversation window. It is possible to switch between conversational categories to initiate a new 24-hour conversation window. However, please note that this change will be charged accordingly.
For example, if you send a message to promote your new products, you will probably use a marketing template, triggering the start of a marketing conversation. The marketing conversation fees would then apply. Halfway through the conversation, however, the need arises to use a utility message template. This change starts a new 24-hour window for a utility conversation, where the utility conversation fee applies.
All existing message templates in the WhatsApp Business Platform will be re-classified into four new categories on April 1st.
The four new categories include:
Utility conversations are business-initiated conversations, often relating to a transaction. Consider purchase information, confirmations, post-purchase notifications, and recurring billing statements to customers who have opted-in.
In most cases, the utility conversation fee will be lower than the current business-initiated conversation rates, helping improve customer service and customer experience.
In authentication conversations, security is critical. With authentication templates, you can authenticate users with One-Time Passwords (OTP) at multiple touchpoints during the login or verification process, such as account registration, account recovery, and other situations where the customer's identity needs confirmation.
“Your Login code is 1234765”
“Your password for your new account is 1234765. Please edit this password after login and do not share this password for security reasons.”
In most cases, the fees for authentication conversations will be lower than the current business-initiated conversation rates. Instead, they will be charged service conversation rates (user-initiated).
As the name suggests, marketing conversations are business-initiated conversations to market a product or service to customers. You can send your opted-in customers relevant offers, deals, or information about product restocking.
Good-to-know: Any business-initiated conversation that does not qualify as an authentication or utility conversation will fall under this category.
“Check out our newest collection and be the first to rock this new look!”
“The blue sneakers are back in stock in your size! Grab them while you can!”
“We’re closed for the holiday, but will return January 3rd.”
“Forgot something? We’ve kept your items in your cart for you! Click here to check out.”
The marketing conversation rates will be higher than the current business-initiated conversations. This news might sound scary, but WhatsApp Marketing has a higher ROI than any other messaging channel. The new fees hardly differ much from other Marketing messaging channels.
Service conversations are all user-initiated conversations, often to resolve a customer inquiry.
“Hi, I need help with my account”
“Hello, is this still in a size 10?”
“Where is my order?”
The rates for service conversations will be similar to fees for current user-initiated conversations.
Benefits of the New WhatsApp Pricing Model
The new pricing model even comes with some excellent benefits.
72-Hours Free-of-Charge Service Entry Points
WhatsApp Business Platform is just one of many products Meta has to offer. To focus on expanding the use cases of its other products, Meta provides 72 hours free of charge when a user initiates a conversation via an advertisement on Facebook or Instagram or a Facebook Page CTA button.
1,000 Free Service Conversations Each Month
WhatsApp will give you 1,000 Service conversations every month free of charge to give your business the opportunity to service your customers and get acquainted with the messaging platform. You can have space to build trust with your customers and experience WhatsApp Business before you begin to pay for more elaborate use cases. Are you ready to expand? Then you will be charged according to the conversation type of your business-initiated messages.
Impact for You
So what impact does the new pricing model have on your business?
The Customer Support Heroes
Is your customer service team set up to receive and respond to incoming messages from your customers? Then you will be charged for service conversations, and your pricing will remain relatively comparable to the historical cost. The first 1,000 conversations will be free each month. Continue to offer the support your customers need and create the optimal customer experience.
The Marketing Magic Managers
Are you in marketing? Do you send your customers updates and news about your new products and services? Unfortunately, the rates for your business-initiated marketing conversations will increase compared to before.
However, WhatsApp marketing conversations have a higher ROI than other channels. Even though the rates are increasing, they are similar to other marketing messaging channels. You can also invest in Facebook and/or Instagram ads to utilize the free Meta entry points for a 72-hour free-of-charge conversation window to boost your conversion rates even more.
The Notification Squad
Do you use WhatsApp mainly for its notification features? One-Time Passwords, codes, purchase confirmations, order updates, Track&Trace URLs, you name it. Then your rates will slightly decrease compared to before.
A Little Bit of Everything
Are you using the WhatsApp Business Platform at multiple touchpoints in your customer journey? Then congratulations! This use case is what Meta envisioned and optimized their platform for. You will benefit greatly from all its features!
Your marketing conversation rates will increase slightly, but you will, in return, save some money on utility and authentication conversations. You will also benefit from the 1,000 free service conversations each month. The impact this new pricing model will have on your business depends largely on the allocation of the conversations.
WhatsApp Business Pricing at CM.com
The new pricing model and the changes it brings apply to the fee invoiced by WhatsApp. CM.com will continue to invoice these fees on WhatsApp directly to you. CM.com pricing will still apply.
Want to know more about the price changes and their impact on your specific use case? Feel free to contact us via the button below or contact your account manager.