Facebook Adds Social Layer To mPayments
By Pete Rizzo, Editor (@pete_rizzo_)
Facebook officials confirmed on Thursday that the company will launch a test program as soon as next month that will seek to improve mobile shopping by eliminating a key consumer pain point: the new Facebook service will allow users to enter their billing information into any mCommerce app with the click of a button.
The announcement adds a new player to the mCommerce landscape, and finds Facebook working in the same space as established players such as PayPal, Google and Amazon, as well as emerging startups like Braintree/Venmo, to improve the consumer mobile shopping experience.
While the service is still untested, it could benefit the social giant as it seeks to build on its recent positive momentum. Facebook also downplayed rumors that it is looking to compete with PayPal after initial news articles suggested it was testing a mobile payments app.
"We continue to have a great relationship with PayPal, and this product is simply to test how we can help our app partners provide a more simple commerce experience. This test does not involve moving the payment processing away from an app’s current payments provider, such as PayPal," Facebook said in a statement, according to TechCrunch.
Here’s a quick recap of this announcement.
Facebook Will Test And Learn
Facebook has chosen Columbus, Ohio-based men's fashion site JackThreads as its launch partner. All Things D suggested that the Thrillist-owned company is uniquely poised for the test run, as it not only has a close relationship with the social giant, but it also generates more than 30 percent of its traffic and revenue through mobile phones.
The media outlet noted that JackThreads' popularity with gamers makes it further suited for the test, as many of Facebook's 250 million social gamers have already provided it with credit card information.
Facebook Could Finally Cash In On Social Commerce
Depending on what the solution looks like, Facebook could potentially gain valuable insights about consumer shopping behavior on mobile devices.
Its share of social logins on the web also suggests that it could help monetize eCommerce conversions. Research from Giga released in July 2013 reported that 52 percent of all social logins take place through Facebook and that Facebook is the preferred login for eCommerce consumers by a wide margin. Seventy-nine percent of respondents in the study said they use Facebook logins when making a transaction, as compared to 12 percent that choose Google+.
Bill Clerico, the CEO of online payment service WePay, says Facebook's presence in this area of the mobile market could bolster security.
"One interesting asset to consider is the amount of data that Facebook has and how that might be used to prevent fraud and underwrite risk," Clerico told PYMNTS.com.
This one will be interesting to watch. If nothing else, it adds fuel to the ongoing narrative that Facebook is now taking monetization more seriously.