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BPO 2.0

Facebook, Kustomer, & The CX Arms Race

With Facebook's purchase of Kustomer, the CX battle for hearts & minds has officially begun.

At $1B, Facebook’s purchase of Kustomer has turned heads across the technology, social media, and CX markets. The price tag clearly indicates Facebook’s intent to elevate its customer experience offering across its portfolio, and, when putting the cost in context alongside Facebook’s top dollar acquisitions, the significance of the purchase becomes very clear: 
  • WhatsApp: $19B
  • Oculus VR: $2B
  • Instagram: $1B

Here at ibex, we’re consistently evaluating the ongoing changes happening across the CX industry, and this acquisition fits with the trends we’re seeing.

So, what does Facebook’s acquisition of Kustomer tell us about their long-term strategy?

In an ever-evolving digital arms race, Facebook is adding another digital & data-rich tool to its arsenal. For those of us in the CX business, what the purchase of Kustomer tells us is this: Facebook recognizes the critical importance of CX as part of its in-app consumer ecosystem; it also recognizes the value of rich consumer data, and unifying these insights across a digital ecosystem.

“The acquisition of Kustomer by Facebook substantiates what the customer services industry has known for years,” says Doug Hoffschwelle, General Manager of Velocity by ibex. “There's amazing value in knowing what your customers are saying - and this value extends in myriad directions.”

Building & Unifying a Consumer & Business Ecosystem

Given Facebook’s past purchases, the company clearly understands the value of building an ecosystem focused on consumer engagement and data insight. Consider the growth of Instagram from a photo sharing social media platform to a growing eCommerce giant, with a robust toolset for SMBs and $20 billion in revenue.

Then take WhatsApp, to which Facebook has already added hosting and shopping features, along with pricing tiers, in what is most likely a move to monetize its huge user base of 2B+ and drive the platform towards profitability.

And finally, let's not forget Facebook Messenger - at 1.2B users, it's the second largest chat platform behind WhatsApp, and is expected to grow to 2.4B users by 2021. And here's the kicker - over 20 Billion messages are exchanged between businesses and users each month over Facebook Messenger. Add a CX platform service to the mix, and you can begin to see where things are headed.

The Data is in the Details

In all cases, Facebook has strategically expanded the use case of each platform, providing customers with more direct brand engagement opportunities through channels they already have an affinity with. In turn, these businesses have gained access to a growing consumer base that is willing to engage and spend with them, along with Facebook's rich consumer insights for strategic product engagement.

“This is a strategic investment in brand; not just for today, but for years to come,” says Jon Lunitz, General Manager of ibex Financial.

“Facebook understands how its customers are using its services, and this data is invaluable to the brands that sell across Facebook. When you add Kustomer to the mix, the value to both the customer experience, as well as the business experience, increases exponentially. I expect that the purchase of Kustomer will not only integrate across Facebook’s SMB offering, but will begin to unify the CX approach across all of its platforms, reducing customer attrition, increasing platform utilization, and providing new revenue streams.”

Facebook’s competitors haven’t been sleeping, either. Consider Snap’s recent purchase of Voca.ai, a technology company that builds A.I. voice agents for call centers to improve the customer experience.

"The whole industry is beginning to see CX as a meaningful way to differentiate, beyond just product,” says Barry Canty, SVP of Marketing at ibex.

“Customer experience is far more than just delivering customer support – it’s about how easy and fluid each engagement is, how personalized the experience can be, and how good the customer feels after it’s complete. Easier engagements drive LTV, CSAT, and loyalty. More and more businesses are beginning to remember this.”

The Kustomer acquisition is a strategic move for a brand that is ever expanding its social media and eCommerce influence. It provides a critical piece of the ecosystem puzzle for Facebook: with the social media, chat, and eCommerce platforms all firing, they now have the CX platform to connect the puzzle neatly together.

At ibex, we provide tech-based CX solutions to brands looking to begin or continue their digital transformation. If you’re a startup, scale-up, or blue chip looking to compete in the CX arms race, connect with us at www.ibex.co to start building your strategy.


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