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8 Takeaways on the Future of Chat Marketing (ft. Molly Pittman & ManyChat CEO, Mike Yan)

“There are MORE users of messaging apps in the world than social networks… Tomorrow’s conversations are going to start on these messaging platforms.”

– Mike Yan, Founder & CEO of ManyChat

Hey, Molly Pittman here.

I’m excited to give you the latest news in Facebook Messenger and other chat marketing, including how they’re going to open up huge new opportunities for your brand.

This is a conversation between me and my friend, Mike Yan. Mike is the Founder and CEO of ManyChat, the world’s leading tool for Messenger marketing.

ManyChat has always been on the cutting edge of conversational marketing, and they have some groundbreaking stuff coming soon that I want to share with you guys.

So, without further ado…Here are the 8 takeaways on the future of chat:

1. Conversational Marketing is Coming to Instagram & WhatsApp

At his yearly Conversations conference, Mike announced that ManyChat is entering beta with their Instagram and WhatsApp integrations, and that they would be adding their first customers in Q4.

“Those two platforms were the two number one requested platforms in the whole world.

And WhatsApp is the biggest messaging app in the world, billions of users. And Instagram, as you know, it’s growing like crazy. And it’s becoming a bigger and bigger portion of Facebook’s revenue stream. It’s growing really fast.”

2. The Way Marketers Use Instagram is About to Change

Mike says that while businesses currently use Instagram to drive organic engagement and Instagram Ads to get customers to their sites, the way marketers use this platform is about to change.

“You’re going to be driving Instagram Ads directly to a direct messaging experience, which you will be able to automate at scale. And then qualify those leads, and then nurture them, and then convert them to paying customers, and then to nurture them into repeat customers, etc.”

And with these new integrations, ManyChat users can take most of the same strategies they’re using on Facebook Messenger and SMS and apply them to Instagram and WhatsApp.

“Basically, they’re merging Instagram and Messenger. It’s basically the same API. So, it’s going to be very, very similar to Messenger in functionality. Some of the policies might be different at first, but then they’re going to merge all the policies together.

WhatsApp is going to be different because they have a different API, but over the years, we expect all of them to merge.”

3. Facebook is Investing in Mobile Marketing

All of us marketers laughed when Senator Hatch asked Mark Zuckerberg how Facebook makes its money, and he responded, “Senator, we run ads.”

But according to Mike, Zuck might as well have said mobile ads:

“I think it’s important for people to know that Facebook makes 98% of their revenue through ads… and 94% percent of that is coming from mobile.

Everybody talks about the desktop experience, but 94% of Facebook’s ad revenue is coming from mobile. And 80% of the watch time is coming from mobile…

Now, what’s interesting is that Instagram is a growing piece of that revenue, a very fast-growing piece… Instagram is about 25% of Facebook’s revenue in North America… That is going to grow to 40%. At some point, Instagram might grow to over half of Facebook’s revenue…”

And with so much of its revenue coming from mobile, it’s no surprise that Facebook is investing heavily in conversational marketing that caters to the mobile experience.

4. Want to Increase the Efficiency of Your Ads? Skip the Landing Page.

So, okay… Messaging is exploding, and the opportunity will only grow as it’s adopted by platforms like Instagram and WhatsApp. But how do you actually take advantage of this opportunity for your business?

“I think the first step is increasing the efficiency of your ads… When you drive ads to a landing page, what you get for that click is a short web session. 90%+ of those people are going to leave in three seconds… The conversion rates are very, very low.

Now, when you drive that traffic to a messaging experience — for example, from the Facebook feed to Messenger or from the Instagram feed or from Instagram Stories to DMs — you get 24 hours of reengagement with 80% open rates and 20% CTRs…

The cost per click can be higher, but the cost per conversion, the end result that you’re looking for is going to be much, much lower. We’ve seen numbers go 2x, 4x lower, 10x lower.

Mike says that more and more of ad spend is being driven to the messaging objective instead of a landing page. While you’re still optimizing for conversion, you’re trying to accomplish that directly from the direct messaging experience.

“When a person goes to a landing page, they’re kind of in this browsing mindset. They’re still in a passive mindset of like, ‘I’m still thinking about do I want to engage with a business or not.’ When they go to Messenger and start clicking, they’re in a conversational interface. They’re in an interface where, like, “Okay, I’m interacting with this business now…

So, the initial interaction is very, very important because after that initial tap, the conversion rates of the next actions when you have the conversation, it just goes to, like, 70%, 80%.

This is for specific cases… If you’re generating leads, that’s one of the perfect ways to do that.”

This is what we’ve experienced in our campaigns at BOOM!.

For a few years now, we’ve taken our abandoned cart audience and retargeted them for 28 days using the messages objective. We off a discount coupon through Messenger, and it’s one of our most profitable campaigns. Partially because it’s a warm audience and it’s a good offer, but also because the messages objective is so much less competitive.

5. Chat Marketing Shouldn’t Replace Your Other Channels — It Should Join Them.

Please don’t just run a quick split test on landing pages versus messages. You have to think of Messenger as its own platform, one that complements the rest of your marketing.

“There’s more users of messaging apps in the world than social networks… Those are the most popular apps on our phones.

I think the number one takeaway that I would want people to know about and business owners and marketers is that the conversations are going to start on these messaging surfaces.

Mike stresses that people shouldn’t expect to replace all their current marketing channels with messaging.

It’s all about understanding what you want to achieve as a business — your end goal, and all the micro conversions that go into that results — and then seeing where chat marketing can supplement your current platforms.

“It’s a much better way to get to that first conversion. And then once you do that, you do reengagement through email, through SMS…

One of the companies that is working with ManyChat, they’ve spent hundreds of thousands of dollars on ads. They’re trying to find talent for auditions for a TV show… They take people from an ad to an automated experience which qualifies the lead… And they’re getting really high conversions.

The cool thing is when the person starts a conversation and then the offer is there… if you ask for an email to deliver that coupon, the conversion rate for people giving out their email to you is from 70% to 90%.

6. All Those “Annoying” Messaging Rules? The’re a Good Thing.

The reason why you probably won’t use messaging to replace all of your other platforms is because Facebook doesn’t want you to use Messenger the same way you would channels like email, for example.

“It provides a bad experience for the end user if you take a very private and a very sensitive channel, and start sending messages like that.”

This brings me to a pet peeve of mine which is when someone says Messenger’s rules are too strict, or that Facebook “ruined it” for marketers.

What people need to realize is that this game is about inventory. Every year that passes, these platforms — whether it’s Google, Facebook, etc.— are going to get more expensive. They’re going to get more crowded. That is the nature of how this works.

Facebook realizes how much ad inventory is possible on Instagram Messenger and WhatsApp.” It’s a huge opportunity, and they don’t want to let marketers ruin it.

That’s why it’s in our best interest to use this platform with the end user in mind. If we want access to this incredibly valuable ad inventory — inventory that will just became more valuable over time — then it’s our responsibility to adjust our marketing to fit within this new channel.

7. You Don’t Have to Get Complicated to See Big Results.

A common thing I hear from people is that they want to adopt Messenger, but they don’t have the time to learn to use it. This is not like learning a new language or something! You can get big results from very little work.

“You don’t have to get into the really complicated messaging policies and message texts and everything else to be super successful with this.”

Take the example I just gave from BOOM!. It was so easy to set up those retargeting campaigns for our abandoned cart audiences.

Again, Mike points out that one of the easiest ways to get started with message marketing is to use it for lead generation.

“I always tell people, ‘Hey, guys. You should be getting emails, you should be getting phone numbers in the first conversation’… Ask for the email before giving out the offer… The conversion rates are super high. Literally every account that I look through, it’s 70%, 80%, 90% of people giving out their emails.

Some people are really smart. They’re saying, ‘Hey, do you want to do email or text?’… 30% of people when you give them the choice, select text… Everybody’s talking about, like, ‘Hey. Phone number is so sensitive. Nobody would give out,’ etc. Literally, if you give people the option… 30% of people select text.

Have you tried Messenger and it didn’t work for you? Mike says it’s usually because people aren’t using it right.

“People tell me, ‘Oh. Messenger didn’t work for me.’ I ask the question, ‘How did you use it?’ They’re like, ‘I would run cold traffic to a landing page.’… So, I’m like, ‘Of course, it doesn’t work. Because you’re just inserting another step between the traffic and the landing page.’ ”

This is just an extra step in the process. Mike says it will work better if you use Messenger (and soon, Instagram or WhatsApp) as the conversion platform and optimize for that experience.

“If you think about Messenger as the instrument to create that conversion and you think about the optimization of the conversation interface, that’s where the thing starts to shine.”

8. Yes, We Want Cheap Conversions. But it’s Also About Volume of Results.

When new platforms come around promising cheap conversions, it can seem too good to be true.

But not only can I confirm that the conversions are as great as they say, and the open rates and clickthrough rates are as great as they say, these kinds of results aren’t the only good thing about messaging.

Even if messaging doesn’t cut your cost per lead or cost per acquisition in half, that is still okay because scale is so much about volume of results.

Of course, we would like to maintain our CPL and our CPA. I’m not saying we’re going to spend just to spend…

But keep in mind that a big part of scale isn’t about finding cheaper conversions — it’s about finding new channels that allow you to maintain your current results while reaching more people as this ecosystem becomes more competitive.

*This conversation has been edited for clarity.

A big thank you to Mike Yan for joining me for this conversation, and for sharing all these amazing insights with our community!

You can expect ManyChat roll out their Instagram and WhatsApp functionality soon.

“I think somewhere in Q1 or Q2 next year.. It’s just a question of when Facebook is going to make a decision to let us open up the floodgates to all of our thousands of customers.”

As for me, I’m like a kid in a candy store! I love testing new stuff, and I can’t wait to try chat marketing on these new platforms.

I’ll keep you posted on these developments from ManyChat, and as soon as we’ve used them and have some data to share, we’ll share it on the Smart Marketer blog.

Thanks guys — talk soon!

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