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Global Messaging Trends 2018

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Grata's third annual review of the global messaging industry from a China/WeChat perspective. This year looks at the evolution of apps, workplace messaging, and smart hardware's impact on messaging.

Published in: Technology

Global Messaging Trends 2018

  1. 1. Global Messaging Trends CHina CHat 2018 Grata.co Global Messaging Trends 2018 CHina CHat Shanghai 21 September 2018 Andrew Schorr founder @ Grata.coImage Credit: Flickr @kamshots
  2. 2. Global Messaging Trends CHina CHat 2018 Grata.co It’s been a rough six months for messaging Chart finance.yahoo.com
  3. 3. Global Messaging Trends CHina CHat 2018 Grata.co Facebook plunged after Q2 Earnings Report -12.4% More at https://www.zacks.com/stock/news/319978/whats-next-for-facebook-fb-stock-one-month-after-its-historic-decline $119B one-day drop. A record. Despite revenue +42%, earnings +32% Falling QoQ DAU/MAU in Europe, only +1% in US/Canada CFO guidance of long-term declining operating margins headed to mid-30%
  4. 4. Global Messaging Trends CHina CHat 2018 Grata.co Twitter shares fell 20% in one day -17.0% More at https://www.cnbc.com/2018/07/27/twitter-earnings-q2-2018.html The second worse day in Twitter history Despite third consecutive profitable quarter Why? QoQ MAU fell (-1%) Other: GDPR, bot cleanup, and dropping SMS support in some markets
  5. 5. Global Messaging Trends CHina CHat 2018 Grata.co Tencent is down $200B this year -28.5% More at https://www.reuters.com/article/us-tencent-strategy-analysis/tencent-under-pressure-to-step-up-its-game-as-regulatory-restrictions-bite-idUSKCN1LS0MP Gaming is 40% of Tencent’s revenue and facing increasing regulatory challenges in China Net cash position YoY changed from +¥21B to -¥35B Concern regarding weak international growth strategy
  6. 6. Global Messaging Trends CHina CHat 2018 Grata.co Snap is down 60% since IPO -48.5% More at https://www.cnbc.com/2018/05/02/snap-sees-its-lowest-open-ever-after-earnings.html https://www.recode.net/2018/9/16/17861692/snap-stock-decline-explained-user-growth-evan-spiegel Falling QoQ DAU Falling time-in-app YoY Ad prices down 65% YoY CFO, CSO, VP of Product, VP of Sales, VP of Engineering, and General Counsel have all left recently
  7. 7. Global Messaging Trends CHina CHat 2018 Grata.co User growth is slowing Q2 2017 YoY growth vs. Q2 2018 YoY growth Source: the companies 17% 11% 20% 10% 21% 8% 5% 3% 3% 2% -3% 8% -5% -5% 2017 2018
  8. 8. Global Messaging Trends CHina CHat 2018 Grata.co WhatsApp, Twitter, and Facebook are all dealing with fallout from privacy, fake news, and bot controversies More at https://money.cnn.com/2018/07/20/technology/whatsapp-india-mob-lynching
  9. 9. Global Messaging Trends CHina CHat 2018 Grata.co Surely WeChat is fine?
  10. 10. Global Messaging Trends CHina CHat 2018 Grata.co WeChat’s International Strategy Not advertising like it’s 2013 anymore. Pragmatic focus on China outbound travel. More WeChat Pay than WeChat. Merchant acquisition, not user acquisition. Official Accounts are open to most countries, but limited features. More interesting: Malaysia and South Africa are only non-China regions with a local WeChat Wallet More at https://jingtravel.com/the-chinese-tourists-will-be-wechat-pays-focus-for-next-three-years/ https://www.ft.com/content/6ec974c6-a507-11e8-926a-7342fe5e173f https://www.cnbc.com/2018/07/19/tencent-to-push-wechat-pay-in-us-despite-trade-war-with-china.html 2013 WeChat ad campaign in European markets
  11. 11. Global Messaging Trends CHina CHat 2018 Grata.co If you can’t grow abroad, grow from within. 2018 Strategic Focus: Mini-Programs, Smart Retail, WeChat Work, Mini-Games WeChat Developer Conference January 15, 2018
  12. 12. Global Messaging Trends CHina CHat 2018 Grata.co Launched January 2017 to skeptical public. Now an unquestionable success. 1M+ apps 200M+ DAU $450M invested by companies in H1 Baidu, Alibaba, Toutiao all have clones WeChat Mini-Programs Valuable real estate: pull-down in WeChat main screen reveals recently used Mini-Programs
  13. 13. Global Messaging Trends CHina CHat 2018 Grata.co 60+ Entry Points to Mini-Programs. Most popular: Sharing Official Account Pull Down Menu Discover Tab Link Service Message Search QR Code Payment Desktop Shortcut 26.3% 20.2% 14.0% 8.8% 7.9% 7.7% 3.5% 3.4% 2.4% 2.2% Source: Jisu App Q2 2018 http://www.3mbang.com/i-1994.html
  14. 14. Global Messaging Trends CHina CHat 2018 Grata.co Closest analog to MPs is Android Instant Apps Distribution in Google Play, search, messaging, and deep links 1B+ devices (Jellybean+) Beta: notifications and 10MB instant apps But Mini-Programs only work within WeChat. More at https://developer.android.com/topic/google-play-instant/ Image credit: https://android-developers.googleblog.com
  15. 15. Global Messaging Trends CHina CHat 2018 Grata.co Google Play Ads Search Boring old URL Instant App entry points
  16. 16. Global Messaging Trends CHina CHat 2018 Grata.co Google actually has a great WeChat Mini-Program Pictionary-like game designed to highlight Google’s AI Compare your drawings with others’ Made for sharing
  17. 17. Global Messaging Trends CHina CHat 2018 Grata.co PWAs are not new, but have strong backing from Google and Microsoft, implementations from Twitter, Lyft, Pinterest, Ele.me, Alibaba, et al Best of apps: Caching, offline support, notifications Best of web: anytime code updates, responsive design, link to anything Progressive Web Apps work on even more devices More at https://www.androidcentral.com/why-progressive-web-apps-pwas-may-ultimately-benefit-google-more-microsoft https://arstechnica.com/gadgets/2018/09/progressive-web-apps-moving-mainstream-as-twitter-makes-its-mobile-site-the-main-one/ Twitter's PWA at mobile.twitter.com
  18. 18. Global Messaging Trends CHina CHat 2018 Grata.co Messaging at Work Workplace Teams Slack WeChat Work DingTalk 1.5M 7M 329K 500K 30K Not really a fair chart: DingTalk and WeChat Work count all registered businesses (free accounts) Unknown how many Microsoft Teams are active, or just teams using Office 365 70,000 Slack teams are paid Sources: https://www.businessinsider.com/slack-8-million-users-ipo-2018-5 https://www.techinasia.com/alibaba-enterprise-messenger-dingtalk https://venturebeat.com/2018/07/26/facebook-acquires-enterprise-messaging-platform-redkix-to-integrate-into-workplace/ https://venturebeat.com/2018/09/24/microsoft-teams-is-now-used-by-329000-organizations-up-from-200000-in-march/
  19. 19. Global Messaging Trends CHina CHat 2018 Grata.co What’s special about WeChat Work? Payments Interoperability Developer APIs Turns every employee device into a point-of-sale device Employees can directly add their customers from WeChat 150+ interfaces and SDKS already familiar to WeChat developers A video call between WeChat and WeChat Work
  20. 20. Global Messaging Trends CHina CHat 2018 Grata.co Interoperability is a big deal All of China is already using WeChat. It’s the primary means of communication. Employees adding sales leads and customers to their personal WeChat was a major pain point for businesses. Tencent’s monopoly with consumers practically guarantees their success in the workplace. Alibaba’s DingTalk will never have access to WeChat. No analog outside of China. Not the same thing as Slack guest accounts or Facebook Multi-Company Groups.
  21. 21. Global Messaging Trends CHina CHat 2018 Grata.co Workplace by Facebook 30,000+ companies including Walmart, Starbucks, Spotify, Danone, et al Similar to WeChat, Facebook benefits from having nearly ubiquitous consumer adoption. A familiar product UI is a lower barrier to workplace adoption (compared to, say, Slack) Workplace Premium is US$3/month/user Recent acquisition: Redkix (email) More at https://www.bloomberg.com/news/videos/2018-08-07/an-inside-look-at-workplace-by-facebook-video https://medium.com/clevyio/why-we-switched-from-slack-to-workplace-by-facebook-e9ed60a070f1 https://venturebeat.com/2018/07/26/facebook-acquires-enterprise-messaging-platform-redkix-to-integrate-into-workplace/
  22. 22. Global Messaging Trends CHina CHat 2018 Grata.co Slack defined the modern work messenger 1,500+ Apps 70,000 paying teams, 3M paying users Current strategic focus on large enterprise via “Enterprise Grid” cloud/on-premise hybrid Freemium model with $8/mo/user for basic, $15/mo/user for plus, and more for enterprise Recent activity: HipChat, Stride, Mission.ai More at https://slackhq.com/slack-acquires-robot-pencils-missions-to-make-it-easy-for-non-tech-teams-to-streamline-work https://www.arnnet.com.au/article/646735/slack-targets-enterprise-users-new-features
  23. 23. Global Messaging Trends CHina CHat 2018 Grata.co How will they deal with overload/fatigue? No one has killed email yet. Slack now integrates with email. Facebook acquired Redkix. Facebook may have an advantage with duel-speed Newsfeed + Messaging. Potential for AI/ML to help filter Has messaging become overly centralized? Backlash could see return to platform- specific messaging/threads More at https://medium.com/clevyio/why-we-switched-from-slack-to-workplace-by-facebook-e9ed60a070f1 https://venturebeat.com/2018/07/26/facebook-acquires-enterprise-messaging-platform-redkix-to-integrate-into-workplace/
  24. 24. Global Messaging Trends CHina CHat 2018 Grata.co Google Hangouts has moved to the workplace Now Hangouts “Chat” for messaging, Hangouts “Meet” for video conferencing and live-streaming Google AI, virtual assistant, plus deep integration with G-Suite tools Threads and Rooms for up to 8,000 people Included with G-Suite, so $5/$10/$25/mo/user for basic, premium, or enterprise More at https://gsuite.google.com/products/chat
  25. 25. Global Messaging Trends CHina CHat 2018 Grata.co Google Talk Google Talk SMS Huddle Hangouts 2005 2008 2011 Hangouts 2013 Allo Duo Hangouts 2016 Great video and article: https://www.theverge.com/2018/4/19/17252486/google-android-messages-chat-rcs-anil-sabharwal-imessage-texting 2018 Hangouts Chat Hangouts Meet Hangouts Duo Chat Google’s messaging journey
  26. 26. Global Messaging Trends CHina CHat 2018 Grata.co Android gets upgrade to “Chat” Android’s default SMS will soon support RCS (Rich Communication Service) thanks to the Allo team. High-res photos and videos, group messaging where supported, SMS when not. Close analog to the green and blue chat bubbles in iMessage. Google has always been constrained on what it can do with default Android messenger. This has been a long, political slog to implement RCS. Microsoft also backing RCS, but not Apple. Great video and article: https://www.theverge.com/2018/4/19/17252486/google-android-messages-chat-rcs-anil-sabharwal-imessage-texting Android Chat concept
  27. 27. Global Messaging Trends CHina CHat 2018 Grata.co Including two of China’s four major telecoms
  28. 28. Global Messaging Trends CHina CHat 2018 Grata.co
  29. 29. Global Messaging Trends CHina CHat 2018 Grata.co WhatsApp still thriving WeChat users tend to discount WhatsApp for slow development pace: their last update was stickers and video calls up to 4 people (!) But WhatsApp Status is the most used stories feature of any app at 450M MAU Founders Acton and Koum both left FB early, forgoing $1.3B in options, over clash of culture With founders out now, less resistance to monetization (Status ads, Business outbound messaging) and possible easing of data privacy to support stronger ads targeting Start a WhatsApp for Business chat from a Facebook Ad Must read: https://www.wsj.com/articles/behind-the-messy-expensive-split-between-facebook-and-whatsapps-founders-1528208641 https://www.businessinsider.com/whatsapp-status-monetizing-stories-2018-8
  30. 30. Global Messaging Trends CHina CHat 2018 Grata.co Many, many reasons to be bearish on Snap, but… Snap is still young. The original creator of stories. Instagram’s muse. Re-redesigned UI New content partners could help advertising revenue recover Tencent, the biggest gaming platform in the world, owns 17% of Snap: gaming platform on the way Latest Spectacles from Snap: “Veronica” and “Nico” Must at https://www.recode.net/2018/9/13/17852442/snapchat-our-stories-expansion-publishers-revenue-stream
  31. 31. Global Messaging Trends CHina CHat 2018 Grata.co “Over the next decade or so, the way these pieces fit together will probably be what defines our company.” -Evan Spiegel More at https://techcrunch.com/2018/09/05/spectacles-v2-nico-veronica/ http://www.kswo.com/story/39060973/snap-tries-again-snapchat-spectacles-2-have-a-new-look Lots of problems with v1 Spectacles, but lots of learning: v2 getting +40% engagement Latest models are water resistant, get two microphones, and have broader appeal (Nieman Marcus and Nordstrom carry them) Wearables still need time for battery, screen, and AR technology to improve – will Snap still be around? Snap’s long-term software and hardware strategy
  32. 32. Global Messaging Trends CHina CHat 2018 Grata.co Hardware is increasingly the frontier of messaging Glasses Headphones Speakers Watches
  33. 33. Global Messaging Trends CHina CHat 2018 Grata.co Smart hardware accrues more influence to the OEM than smartphones Always-on microphones, cameras, and screens are reducing reliance on smartphones The hardware OS can influence the communication channels you use Potential for hardware to increase app agnosticism among users with less agency in choosing how a virtual assistant carries out an action, which could be disruptive Amazon Echo Show doesn’t play YouTube
  34. 34. Global Messaging Trends CHina CHat 2018 Grata.co Fastest growing digital time is on “other devices” +5.4% Overall Growth YoY +6.5% Mobile -4.5% PC +50.0% Other devices Chart from https://www.kleinerperkins.com/perspectives/internet-trends-report-2018 Daily hours spent on digital media
  35. 35. Global Messaging Trends CHina CHat 2018 Grata.co Smart Speakers +48% YoY 90M devices by end of 2018 Source https://voicebot.ai/2018/06/28/smart-speaker-users-pass-50-million-in-u-s-for-the-first-time/ https://www.forbes.com/sites/johnkoetsier/2018/05/29/smart-speaker-users-growing-48-annually-will-outnumber-wearable-tech-users-this-year
  36. 36. Global Messaging Trends CHina CHat 2018 Grata.co Amazon dominates the market, but losing share Apple claimed 4.1% of the market after only four months on the market Source https://voicebot.ai/2018/06/28/smart-speaker-users-pass-50-million-in-u-s-for-the-first-time
  37. 37. Global Messaging Trends CHina CHat 2018 Grata.co No surprise that Apple is after the high-end market Homepod gets good reviews for best-in-class audio quality, but poor Siri functionality Can Siri keep up? Siri was hardly mentioned at WWDC in June Airpods are one of Apple’s most successful accessories ever and key to voice strategy Pipeline: High-end Airpods and studio-quality over-ear headphones More at https://voicebot.ai/2018/06/26/apple-is-planning-new-homepod-and-airpods-for-2019-bloomberg/ https://voicebot.ai/2018/06/04/what-you-didnt-hear-from-apple-wwdc-about-siri-voice-or-ai/
  38. 38. Global Messaging Trends CHina CHat 2018 Grata.co Others are priced for mass-market adoption $49$49$350 Amazon Echo Dot Google Home MiniApple Homepod
  39. 39. Global Messaging Trends CHina CHat 2018 Grata.co Nobody undercuts Xiaomi $49$49 $25 Amazon Echo Dot Google Home Mini Mi AI Mini
  40. 40. Global Messaging Trends CHina CHat 2018 Grata.co Amazon was first to market and still racing Launched 70+ Alexa-enabled devices in September including entirely new device categories like Alexa Guard for home security and Echo Auto Second-generation Echo Show has eight far-field microphones to Apple Homepod’s six Expanding from software APIs for speech recognition and NLP to new hardware chipsets with Amazon Connect More at https://www.theverge.com/2018/9/20/17883242/amazon-alexa-event-2018-news-recap-echo-auto-dot-sub-link-auto-microwave Chart from https://www.kleinerperkins.com/perspectives/internet-trends-report-2018
  41. 41. Global Messaging Trends CHina CHat 2018 Grata.co Google AI is best positioned to challenge Alexa Duplex demo stole the show at Google I/O in May Google Home now interfaces with 5,000+ devices Google Assistant’s capabilities are available for developers via Dialogflow and new Contact Center AI in alpha Leaks from the new Google Pixel 3 show an Always-On setting for Google Lens and Assistant- connected ear buds More at https://www.recode.net/2018/6/27/17508166/google-duplex-assistant-demo-voice-calling-ai https://9to5google.com/2018/08/23/pixel-3-xl-leak-first-look-google-camera-lens-assistant/
  42. 42. Global Messaging Trends CHina CHat 2018 Grata.co How does Facebook fit in this ecosystem? M has been downgraded from a virtual assistant to a suggestion engine Wit.ai powering Messenger chatbots, but still not charging for it Smart screen “Portal” launching soon, but running on Amazon Alexa Facebook’s own voice assistant “Aloha” still in stealth development https://cheddar.com/videos/facebooks-portal-video-chat-device-to-be-announced-next-week https://techcrunch.com/2018/08/21/facebook-voice https://voicebot.ai/2018/08/21/first-sighting-of-the-facebook-aloha-voice-assistant-appears-in-messenger-along-with-voice-messaging-in-instagram/
  43. 43. Global Messaging Trends CHina CHat 2018 Grata.co Thank you! Andrew Schorr Founder @ Grata.co andrew_schorr Grata is a live-chat platform for the messaging era www.grata.co grata_co grata_co andrew@grata.co

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