Meta India head Sandhya Devanathan on why India is a key market for WhatsApp Business, AI initiatives

It may be cliched but it’s true. India runs on WhatsApp. It’s so integral to our daily life that many people use it as a proxy for the number of internet users in the country.

This has led to a rapid adoption of conversational commerce experiences among consumers in the world’s second-largest internet market. As a result, WhatsApp has become a preferred channel for small and medium-sized businesses to connect with their existing customers and attract new ones.

Facebook parent Meta is aiming to capitalise on this opportunity with a suite of products and features under its WhatsApp Business offering, as part of its push to monetise its most expensive acquisition to date.

The move also comes as business messaging has become strategically important for Meta in recent years, as it looks to diversify its revenue sources beyond traditional digital advertising.

In an interview to Moneycontrol, Meta India vice-president Sandhya Devanathan said that India is one of the key priority markets for business messaging globally for the social networking giant.

Business messaging is also a big growth driver for Meta in India, with revenues from Click-to-WhatsApp ads doubling in the country in the past year, Devanathan said. However, she didn’t disclose any further details.

Click-to-WhatsApp ads enable businesses to place a call-to-action button across Facebook and Instagram that, when clicked, opens a conversation thread with the business on WhatsApp.

Devanathan also spoke about the impact of organisational changes at Meta India, the company’s major focus areas for the coming year, and the role that the country will play in Meta’s global AI efforts.

India has been Meta's biggest market for several years, but in terms of revenue, it has always lagged behind. Now that Meta is accelerating monetisation on WhatsApp, do you think this will change in the coming years?

When I discussed our strategy for Meta in India last year, there were a few things. First, Businesses should find us as the best rupee they spend their advertising money on. Whether you're big or small, if you're driving some outcomes, be it increased sales or deeper engagement, we want to help businesses do that.

We saw that business messaging could be that force multiplier for businesses. We saw that organically users were already messaging each other frequently on WhatsApp. 90 percent of the people that we surveyed talked to a business on WhatsApp every week.

So that became a central part of our strategy - there is all this behaviour, but we've not built anything to enable that behaviour in a meaningful way. So how do we make sure that it's not just organic, but as a company, we're putting weight behind it. This would definitely mean some monetisation outcomes for us, which we were ok with, since we were clearly adding value there.

We also want to make sure we remain an innovative India-first company in terms of what we do. If you see the announcements we made at the summit, it is a perfect mix of these three pillars - how we add value to businesses, large and small, how we think business messaging will be the engine of growth for Meta in India, and how that can be supercharged by AI.

We don't break down the business messaging revenues, but click-to-WhatsApp revenue for us has doubled in the last year in India. Payments volume has also doubled for us on the platform in the last six months. We are also seeing that (WhatsApp) Flows have been adopted by 1,000s of people.

Does the free WhatsApp Business app serve as a funnel to bring small businesses into the Meta ecosystem, with the potential to upsell other offerings, or do you see them maturing and adopting the WhatsApp Business platform instead?

A bit of both. It depends on the needs of the business. Many small businesses were anyways organically messaging their customers. So what WhatsApp Business app has given them is a better tool to manage those relationships with their loyal customers, or prospective ones.

Of course, if you're a small business experiencing great success, at some point, you would want to migrate to WhatsApp Business API to keep up with the volumes. We have many of those examples and also have a large trusted set of ecosystem partners we work with who facilitate that transition seamlessly.

With the increasing adoption of business messaging in India, do you anticipate a shift in Meta India's revenue mix, particularly between ads and business messaging?

Actually, the amount of money we make on business messaging is not important right now. What's more important is ensuring that both businesses and users are deriving value out of that exchange.

The focus at this point is making sure we're building rich and delightful experiences, because it has tremendous scale and opportunity for small businesses to grow on WhatsApp as a platform.

For example, with Meta Verified, you not only have the ability as a business to build trust with your existing and prospective customers, but you also get a customised web page that is searchable.

Also read: Meta Verified now available for all small businesses on WhatsApp

So we're not just thinking in terms of the monetisation aspect but also thinking a bit more broadly around what it is that we would like to enable as experiences on the platform. Over time, our hope is that across the entire family of apps, we are adding a lot of value to businesses and to users, and they continue to support us in terms of the ROI (return of investment) that they see and the investments they make with us.

Business messaging is a big growth driver for Meta in India. That said, on the ad front, I say this often, ad spend as a percentage of India's GDP is currently low.

With GDP and digital growth, penetration will rise, so the size of the pie on the ad side will keep increasing. Therefore, we remain optimistic about both the ad side and the messaging side.

Do you think business messaging works better in a market like India, where advertising ARPUs are low compared to more mature markets like the US or UK, where ARPUs are significantly higher?

More than ARPUs, it comes back to consumer behaviour. In India, we see that people want to talk to businesses and have a conversational commerce experience with them. Two in three Indians we surveyed expect a business to have a conversational chat feature. If not, they're frustrated.

Conversational commerce is also huge in some of the Southeast Asia markets but not many of the other markets have a similar trend.

The platforms could also be different in other countries, since there is Messenger and Instagram as well. However, there's definitely an uptick in people wanting to chat with businesses and close the transaction there.

Also read: WhatsApp allows real-money gaming firms to send promotional messages in India; alcohol not allowed

You took over as the head at a time when there was a lot of flux at Meta India, with several exits and a global advertising slowdown, including in India. Do you believe things have stabilised now?

Things are much more stable now — more than just stable, I think. There's a renewed sense of optimism and energy. With the festive season coming, teams are all focused on making sure we are doing the right things for all our constituents, whether it's advertisers or policy teams.

The global teams have really invested in building products for India, which also contributes to the overall energy. You have a lot of teams investing their time, resources, and energy in understanding our users and businesses and building for the country.

What has surprised you the most in the past two years?

I grew up in India and spent the first five years of my career working here. Hence, the pace of change, growth, optimism and confidence that I see in the country is amazing. I feel lucky and privileged to be back home in my country at such a pivotal time.

When you took over, there was also a change in the operating structure. Previously, Meta India reported to the Menlo Park HQ and it is now reporting back to the APAC office. Does that signal any change in the significance of the market?

No. We've not seen a reduction in terms of prioritisation for India as a market. In fact, over the last two years, we've probably seen a lot more teams come and spend time building for India. I've worked with this company for almost nine years. If we collaborate well enough, we have interesting problems to solve. We have a big opportunity ahead of us.

At Meta, the organisational structures never seem to matter. It's how people come together, and that's something that I've always valued at Meta, and it's certainly been true for me and my teams for the last two years.

You mentioned building products with an India-first lens. Do you see an opportunity for Meta to build a product team or engineering presence here?

So far, we've not seen a gap, because the teams index very heavily on India and build with us for the country. It's not like they build, and then we are asked to give inputs. Often, the teams are closely involved from the very beginning, thinking about what the insights mean and how they impact the product roadmap we have for the country.

A host of tech firms, including Meta, are looking to tap into India's rapidly growing developer base. What steps are you taking to foster the developer community?

If you look at the Llama downloads until now, a big chunk of the 350 million downloads is coming from India.

What we are now doing is ensuring that startups building on Llama have community support and also benefit from developer circle-like initiatives. We are enabling that, but also ensuring that they have access to what's happening elsewhere globally, from Meta and other experts.

We want to actively identify these startups and give them a place to tell their stories. We've just announced a global hackathon that will take place in Bengaluru in the near future.

Also read: Meta bets on India's AI talent with Llama 3.1, Hindi support

What are the big focus areas for Meta India in the coming year?

For us, how do we ensure that businesses, whether they are large or small, get the right kind of outcomes that they are driving for their business on our platform, and that we disproportionately drive economic growth and value for those businesses.

We are also looking at how to broaden the usage of open source AI models that we have, with Llama 3.1 being the latest and how do we work to get the benefit of that to India and help other companies.

The last bit is that the video and creator momentum continues to be strong. 50 percent of all our global watch time is now on Reels. We don't break out the numbers but India is always on the top. That is an area where we will continue to double down.

What is the biggest challenge you are currently facing from a Meta India perspective?

The first challenge is how do we keep up with the pace of the growth that we're seeing so that we are able to continue to service our businesses and our ecosystem partners.

Also, India itself is changing rapidly, so how do we ensure that we are always on top of what's happening here, and making sure the teams in the US that are building the products have a direct line of sight into what's happening, and can help work with us to capture those trends and opportunities.

What role is India playing in Meta's global AI efforts?

India is incredibly important when we think about AI efforts on our platform. Susan Li (Meta CFO) recently spoke about India being the largest market for Meta AI which is being used by over 400 million people on a monthly basis.

Just last week, the WhatsApp leadership team was here, and during some of the user immersions that we did with users, they were surprised by how and where people were using Meta AI. It was not just Delhi, it was tier-2 and tier-3 cities and villages. So expect us to continue to double down and invest in those experiences, making them richer and more meaningful.