Facebook announced the acquisition of WhatsApp earlier this week for $19 billion (£11.39 billion), reinforcing its power in the social media market.
Marc Zuckerberg has grown to be one of the most powerful businessmen in the world and his empire is showing no signs of slowing down, despite competition from other channels such as Twitter and Google+.
However, the purchase of WhatsApp is not just an example of Zuckerberg stamping his authority on the industry. Instead, it is actually a huge development for the future of digital marketing.
What have Facebook bought?
The price tag of $19 billion is a sensational amount of money, but the purchase could prove to be a shrewd move in the long run.
WhatsApp has developed a rapidly growing userbase, with more than 450 million people utilising the service on a monthly basis.
For those who don’t use it, the service provides a free method of sending and receiving picture and text messages without any advertisements. In fact, its traffic is now approaching the entire global telecom SMS volume, with over one million new registered users arriving daily.
These are staggering statistics and WhatsApp has no doubt taken significant amounts of money from mobile phone companies due to consumers using WhatsApp instead of their own tariff.
Investing in data
Along with the millions of users that come with the acquisition, Facebook has captured a substantial amount of data.
This could help to make ad targeting even more precise for Facebook, enabling them to gain a better understanding of customers and retain them, protecting the business from suffering the same fate as MySpace, which was overtaken by Facebook in the market and never recovered.
While Facebook is still performing well, Zuckerburg is conscious of competitors in the industry, which was evidenced by the acquisition of Instagram for $1 billion in 2012 after the photo-sharing network recorded significant growth.
With social media becoming more and more competitive, it is vital for platforms to protect their data and expand and the blue and white empire is looking stronger than ever.
Photo source: Jan Persiel | Flickr |