Facebook acquires customer service platform Kustomer for $1 billion

Kustomer, which is based in NY, had raised roughly $170 million in venture funding, according to data compiled by Crunchbase.

Facebook expects to host Kustomer data on its own infrastructure. They, I think, see this as a way to use Facebook to interact with customers when customer service is necessary.

In doing so, Facebook will act as a service provider at the instruction of business customers.

Facebook has been gradually building up a big business unit, offering customer services to businesses through its platform, and now the plan is to double down on the same with a platform capable of doing much more of that, potentially as a paid service. Recently, the platform has been acquired by social media conglomerate, owner of WhatsApp and Instagram- Facebook Inc. Before deploying Kustomer, Rainbow customer service agents were reporting difficulties obtaining access to siloed information about the customer, their order history, order status, refunds, and other issues.

Therefore, one can view this acquisition as a necessary add-on to Facebook's goal of further accelerating their pace with social commerce as well. But as the company is facing keen competition from Snapchat, TikTok and others, having a better product to sell businesses along with their other services will provide it an effective way of retaining them into the Facebook ecosystem. It also allows for automated conversations using Chat bots.

Facebook nears deal to buy customer-service startup Kustomer: Report

The CRM tools will help Facebook manage interactions with customers through the phone, email, text or direct messages in specific apps including Whatsapp and Messenger.

This way, the social media behemoth will also be able to stay ahead of their rivals which have been making some similar moves as of late.

Facebook's acquisition is a first for the giant tech company that has primarily invested heavily in social consumer-centric companies such as Giphy.

Kustomer Chief Executive Officer Brad Birnbaum wrote in a separate blog post that "once the acquisition closes, we look forward to working closely with Facebook, where we will continue to serve our customers and work with our partners as part of the Facebook family".

Now, how Facebook will be leveraging this omnichannel customer servicing tool is anybody's guess right now.