This is how shopping via WhatsApp should work

Dusseldorf For many retailers, WhatsApp has been a lifeline when they have had to close their shops in lockdown. The traditional department store Schäffer in Osnabrück, for example, equipped each department with its own smartphone so that employees could stay in contact with customers via the chat app. The bicycle dealer Rose Bikes from Bocholt was even able to compensate for 40 percent of the lost sales through sales advice via WhatsApp in the first year of Corona.

But most retailers find it difficult to process the entire purchase via the chat program and then to connect it to their own merchandise management system. This is exactly what the business idea of ​​the start-up Charles is based on: the founders Artjem Weissbeck and Andreas Tussing have developed software that combines service, sales and even newsletter functions for chat apps in an easy-to-use manner.

Now the founders have received further confirmation that they appear to be on the right track: Investors led by Salesforce Ventures have now given them $20 million in capital to expand. Accel and HV Capital, who had previously invested in the company, also participated in this Series A round.

“Charles is creating a new software category,” says Nowi Kallen, Managing Director at Salesforce Ventures, the strategic investment arm of the e-commerce software provider. This leads to higher sales and lower customer acquisition costs, customers rave about the possibilities of the software.

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More than 100 retailers are already using Charles’ software, the company said. Some of them realized seven-digit sales via WhatsApp. In addition, customers achieved opening rates in newsletters of more than 90 percent via WhatsApp and generated eight times more revenue per recipient than via email.

Expansion planned in Europe

Charles uses a special WhatsApp interface that enables the direct integration of web shops. Using a shopping button, users can now display a supplier’s products and then buy them immediately via the chat. Charles connects the retailer’s trading system to WhatsApp, enabling a seamless sales process.

Direct contact seems to have an impact on sales success. In a study commissioned by Facebook, the Boston Consulting Group found that customers who chat with companies spend an average of 60 percent more money than other customers. However, a third of those surveyed also expect personalized tips as well as individual offers and prices.

This is precisely why Charles’ software involves the retailer’s employees in the process. They handle the sale, but with the support of artificial intelligence and chat bots. “From the beginning, our mission has been to make commerce more personal again by incorporating it into our most human habit: conversation,” explains co-founder Weissbeck.

The start-up wants to use the fresh capital to expand into new markets in Europe. “We will use the financing round to expand to Great Britain, France, the Netherlands, Spain and Italy,” says Weissbeck. So far, Charles is only active in Germany, Austria and Switzerland.

Role model Tencent in China

So far, the company has mainly approached smaller retailers. But now it wants to expand its customer target group. “Salesforce’s expertise will help us gain more access to large corporations,” hopes co-founder Weissbeck. The first pilot tests have shown that the company is now ready for this.

In China, it is estimated that a third of e-commerce is no longer processed via classic web shops, but via social networks. That’s why it’s completely normal for most customers there to make their online purchases via chat programs.

>> Read here: Role model China Live videos are becoming the new sales engine in e-commerce

One of the pioneers is the Internet giant Tencent, which has even integrated its own payment service provider, Wechat Pay, into its Wechat messaging service. The number of daily active users of Wechat increased by 12.5 percent year-on-year to 450 million last year. Tencent generated $17.5 billion in social media revenue in 2021, most of which came from Wechat.

Tarek Müller, head of the online fashion retailer About You, was part of a group of business angels who made Charles’ commercial start possible two years ago with seed capital of one million euros. He is certain that sales via chats, also known as conversational commerce, will soon become popular in Germany too: “It will spill over from Asia to the West.”

More: Google turns YouTube into a shopping channel – and attacks Amazon

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