Many brick-and-mortar retailers, as well as e-commerce providers, still believe that the greatest threat comes from Amazon. However, this is not the case. The real threat is within our grasp every day: Facebook's Unified Commerce. With almost 500 million users and now its own app that also enables payments, Facebook Messenger, Facebook has separated the messaging function from its main app on mobile devices, forcing users to use a separate app. This was intended to allow for a faster rollout of new features, it was claimed at the time.
Spin off, then expand
At the recent f8 conference, Facebook announced plans to offer not only a payment service but also to integrate further, fundamental additional functions into Messenger. The intention behind this isn't entirely clear, and retailers and e-commerce providers are likely unaware of it, because Facebook is becoming a serious player in this segment: soon, presumably, with its own operating system based on Messenger for 1.4 billion users and combined with its own payment solution, accelerated by 700 million WhatsApp users: Facebook's Messenger platform could be the beginning of something truly massive. Why this assumption? At its recent developer conference, Facebook presented plans for an enhanced Messenger, meaning developers are now free to create and integrate applications. Alongside the announcement of "Messenger for Business," the platform was expanded for third-party providers, and shortly thereafter, over 40 apps were available for extension. Why this move, and why specifically via the Messenger application? Facebook apparently wants to become less dependent on the so-called gatekeepers, namely Google Play and, above all, Apple's iTunes. However, this isn't yet fully possible. As Facebook explained, a complete platform solution would primarily slow down the app. Therefore, they prefer a more gradual approach: External apps are only linked from within Messenger and are able to display content in Messenger chats to a certain extent. The actual installation of an external, third-party app, however, is done conventionally via the respective app store from Apple or Google.
So, for now, Messenger still functions as a classic communication tool. Messages are sent, received, enhanced, forwarded, and so on. This comes at the expense of traditional services like email. Certain generations almost completely forgo private emails and replace communication with Facebook Messenger. The same applies to SMS, which has been and continues to be cannibalized by WhatsApp. It's simply a shift of the same actions to new applications. So, what's behind Facebook's focus on strengthening Messenger? As mentioned earlier, the true potential lies less in the messages themselves and more in the underlying transactional intent. Facebook wants to position Messenger not as an application, but as a platform, which seems to have begun recently with its complete spin-off as messenger.com. First, spin it off, then expand and develop it further. But at that point, at the latest, the interests of Facebook and the operating system operators will clash massively, because Facebook wants to place greater emphasis on transactions, including financial ones. Currently, Messenger is only open to apps that want to upload images, videos, and audio files. Eventually, news content will likely also be available that presents services and products in the sense of a (currently classic) eCommerce transaction.
Build it, use it, lock it
Mark Zuckerberg explained back in November 2014 that he wanted to push the use of Messenger so people could communicate more efficiently and quickly. To that end, all Facebook users had to download a separate Messenger app last year. But that's probably only half the battle, because now that the app is on all smartphones, it's easy to see this application not as a messenger per se, but as a kind of browser for smartphones. More and more content is being shared and commented on via Messenger (browser), appointments are being made, and information is being exchanged. People are discussing, browsing, researching, and will probably eventually even make purchases directly, all within the same application. The boundaries are blurring and will eventually disappear altogether, and thanks to its own transaction system, payments are also easy. This is something Facebook has lacked until now, and it's not even feasible in the current situation with Apple and Google taking a cut of in-app purchases. At least not for the time being.
Paying conveniently via the Messenger app is only a matter of time – because Facebook could also profit from it, in addition to advertising. What also supports the strategy described above is a key personnel decision: David Marcus, the former head of the online payment service PayPal, is responsible for Messenger. PayPal launched the money-sending function in Messenger last summer, shortly after Marcus's move to Facebook, and it's already available in the US. But where is the future customer base? Exactly, alongside WhatsApp Messenger, which Facebook acquired in 2014. All that's missing is this seamless integration into the Facebook ecosystem – screenshots of WhatsApp sharing buttons within Facebook already surfaced in April of this year. Was this just a coincidence or a beta test? Facebook offered only a brief comment on the images. An alternative approach would be to partner with a hardware provider and ensure that the Messenger app is pre-installed and prominently displayed at the time of purchase. For example, with Samsung, which is facing increasing pressure in the smartphone market, or the Chinese rising star Xiaomi, in which Facebook, according to various reports, would like to acquire a stake. So, two very attractive cooperation partners for a scenario that is still hypothetical but nonetheless logical.
Users will decide whether and how they use it. But one thing is certain: companies, retailers, and marketplaces need to make an effort. While retailers could previously score points with their expertise in customer service, in today's e-commerce, price, availability, and (delivery) service are paramount. Now, with the advent of unified commerce, they must overcome the next stage: the lock-in effect. Users and buyers are creatures of habit, so why switch platforms just because they want to buy something? Advice, service, and availability suddenly become obsolete if companies fail to reach customers more directly and build loyalty. Not easy in the impatient information age, but not impossible.
