Payment companies need to pay attention to social payments, which will get a major boost as consumers get more comfortable with mobile transactions.
Social platforms are finding new ways to enhance user experience, including the use of social payments, such as Snapcash, Venmo and Twitter Buy, which allow consumers to directly transfer money to their friends or make purchases online from the network's partners.
According to MasterCard's third annual Mobile Payments Study, consumers are more optimistic about mobile payments. In 2014, 94% of the global conversations about mobile payments were favorable, compared to 77% in 2013 and 70% in 2012. Consumers are becoming more comfortable with mobile payments and believe they are safe and secure.
What does this mean for social payments? As people grow more comfortable with mobile payments, the social payment trend will continue to take off. Currently, social payments are either peer-to-peer transactions or online purchases. Snapchat's Snapcash is the former, and allows users to send money from their debit card to their friends by typing in the dollar sign and the amount into the chat box and pressing the send button. Twitter Buy, on the other hand, adds a buy button to sponsored tweets and Twitter cards from the network's partners, so users can directly purchase advertised products and services.
Facebook too plans to utilize mobile payments. It recently announced its plans to become a peer-to-peer social payment platform. Similar to Snapcash, Facebook users will be able to link their debit card to the service and use the Messenger app to send money to other individuals. To reduce the risk of unauthorized transactions, users will have to enter a PIN or use Apple's fingerprint identification system before completing the transaction. With over 500 million monthly users, Facebook's Messenger app is one of the largest platforms in the world.
As consumers show a more positive sentiment toward mobile transactions, it will not be long before many make the move toward social payments. Marketers can leverage this opportunity to connect directly with their potential and existing customers, as well as grow their brand's followers and turn convertible leads into sales.
With paid advertisement services on social media sites, such as Facebook and LinkedIn, marketers can create ads that strategically target a certain demographic. Soon every social media platform will offer social payments, and marketers who pay for sponsored content or ads on social media will be able to reap the benefits of the buy button across all social media channels. Marketers will generate more sales, while consumers will be able to purchase a product or service directly from the network.
Hugh Sinclair is the vice president of logistics at Shopping Blitz.