Meta Platforms Inc. (NASDAQ: META) unveiled during a conference in Brazil its inaugural AI-powered ad targeting program for businesses on WhatsApp. This marked a significant shift for the popular encrypted messaging service.
The tech giant is also integrating AI tools to create an ad to run on Instagram or Facebook and to help make sure businesses can follow up with customers.
The development represented a departure for WhatsApp, which has long prided itself on its privacy credentials and avoided the targeted advertising techniques used by Meta Platform's other platforms like Facebook and Instagram, reported Reuters.
Meta Platforms incorporated for several years commerce and payment features into WhatsApp, such as business messaging tools for customer service and marketing.
Previously, these tools sent messages broadly to users who had opted in. The new AI-driven tools will leverage user behavior on Facebook and Instagram to tailor messages to the most receptive customers, provided they use the same phone number across accounts.
Guilherme Horn, WhatsApp's head of strategic markets said the AI tools will enable businesses to optimize ad delivery to users most likely to engage, which is crucial as they are paying for those messages.
Meta Platforms has been intensifying its efforts to monetize WhatsApp, which boasts the highest number of daily users among the company's apps.
Despite its popularity and the $22 billion acquisition cost in 2014, WhatsApp contributed minimally to Meta's overall revenue.
The introduction of AI tools is part of a broader strategy to enhance revenue generation from the platform.
Meta Platforms also showcased a new AI chatbot designed to handle business inquiries directly within the chat. This chatbot is part of CEO Mark Zuckerberg's vision to automate business communications, assisting users with tasks such as locating catalogs or checking business hours, akin to existing AI customer service platforms.
Meta Platforms additionally announced the integration of Brazil's PIX digital payment system into WhatsApp. PIX, which accounted for about 39% of Brazil's transactions last year, offers similar services to WhatsApp's payment tool, such as transferring money between individuals and making purchases from businesses.
Meta Platforms stock has gained more than 87% in the past 12 months. Investors can gain exposure to the stock via Vanguard Communication Services ETF (NYSE: VOX) and Communication Services Select Sector SPDR Fund (NYSE: XLC).
META Price Action: Meta Platform shares are flat Friday morning at $493.83.