According to the source, 600 million users of Facebook Messenger will soon be able to order food, buy products and text directly with businesses. Meanwhile, SMS-based on-demand delivery Magic is raising USD 12 million from Sequoia to allow customers to order any on-demand service by sending a text message.
The source argues that the US is finally discovering what Asia has known for years, namely that mobile messaging is a commerce platform.
These developments herald what Chris Messina recently described as a new trend towards “conversational commerce,” in which users will be able to shed the need for countless apps from different companies in favour of a simple mobile messaging interface.
Facebook and Sequoia are not alone in making a big bet that conversational commerce marks the next stage of texting’s evolution, the source notes. Earlier in March 2015, Alibaba poured USD 200 million into SnapChat, which now enables users to send money to a friend or buy a product using their newly-launched SnapCash. This follows Alibaba’s USD 215 million investment in Tango in 2014. Rakuten snapped up Viber for USD 900 million with an eye towards integrating mobile commerce into the messaging app.
Asian investors are the drivers of this trend, the source points out. China’s WeChat, for example, generates over USD 1.1 billion in revenue by enabling its 440 million users to pay their bills, hail taxis and order products with a text. Line, a Japanese messaging app with 200 million users, has rolled out LinePay, allowing its users to make mobile payments, order groceries, book taxis and others.
The conversational commerce trend is also being boosted by a number of new ‘concierge’ messaging services that employ a combination of human and artificial intelligence. For instance, Magic enables users to send a text to order food, send flowers or get laundry detergent delivered within the hour.
Other startups in the “conversational commerce” space include Scratch and BRANDiD, which provide curated shopping recommendations; and Native, whose personal travel assistant service allows customers to book flights and hotels by sending a text. Path Talk was the first messaging app to allow users to message directly with businesses, making restaurant reservations similar to sending an SMS.
The inevitable evolution of messaging apps like Facebook Messenger and SnapChat into commerce platforms will change the way we think about mobile commerce, the source concludes.
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