As is its annual custom, February is about to depart almost as quickly as it entered. And though the month will be longer by one day thanks to the complexities of the Gregorian calendar, it seems probable that given the ride many finance and tech players have had in the second month of the year, they are all set for turning the page and moving briskly on to March.
March brings the promise of spring after all.
But February is not quite ready to throw in the towel just yet and seems to have saved some of its best for last. Venmo is blowing the doors off its numbers, Facebook is cashing in and Amazon is, well, being Amazon and attempting to eat up all of the verticals there are to have in retail.
Need to know a bit more on all of that?
No problem, Dive into the Data.
Venmo Blasts Past The Billion Dollar Mark
Venmo — the P2P payments service that nine out of 10 Brooklyn-based hipsters non-ironically recommend — announced last week that a major milestone has been met and exceeded.
It seems $1 billion in payments were made via Venmo last month (Jan. 2016) — an increase of 2.5 times the volume it saw in the month just one year ago.
All in, for the year 2015, the mobile P2P payments app owned by PayPal processed roughly $7.5 billion — a full third of which fell during the holiday shopping season (Q4).
That is a 213 percent increase from the year prior.
Those big numbers coincide nicely with the launch of Pay with Venmo, which enables in-app purchases for certain apps. The pilot kicked off in partnership with food delivery service Munchery and sports ticketing app Gametime — two Braintree merchants that fit well with its core demographic.
The pilot program will gradually open to more consumers and merchants, with a general public launch planned for later this year.
PayPal CEO Dan Schulman noted of the recent expansion that the program was a natural fit for Venmo’s younger core audience. Merchants benefit from the social features of the app, though it is a benefit they pay for with a 2.9 percent transaction fee (plus a $0.30 charge per transaction). Users don’t pay any extra for using the service.
As for the financial impact of Venmo on PayPal, Schulman noted that he doesn’t expect to see “meaningful revenue” come from Venmo until 2017 or 2018.
Venmo processed $2.5 billion in payment volume in 2015’s Q4, which was a 174 percent YOY increase from 2014.
Facebook Messenger — Now With Ads
It seems the time has come for Facebook’s messaging service — the aptly named Messenger — to start earnings its keep.
According to reports earlier this week — via a leaked confidential Facebook document — the firm plans to insert advertisements into its popular integrated and standalone Messenger platform.
“We don’t comment on rumor or speculation,” a Facebook spokesperson told TechCrunch. “That said, our aim with Messenger is to create a high-quality, engaging experience for 800 million people around the world, and that includes ensuring people do not experience unwanted messages of any type.”
What form the ads will take is unknown — simple popups seem unlikely — and this is not Facebook’s first rodeo monetizing Messenger.
Businesses On Messenger launched about a year ago in March 2015 as a way to replace traditional phone conversations with text-based inquiries and responses through Messenger. It’s a simple way to solve a new problem: If buy buttons are a little too in-your-face for skittish online shoppers, in-app advice from a sales associate may be the intermediary step this changing retail industry needs.
According to the current operating theory on Facebook’s advertising plan for Messenger, the initiative might be a way to further enhance communication between brands and buyers and create an opportunity to promote events, sales or content through a dedicated channel.
Of course, it remains to be seen if consumers are looking for that kind of communication. Or even if that is exactly what Facebook is thinking for its ads. We’ll keep you posted.
Amazon’s Newest Old Thing
With the drones, the spaceflight, the food delivery, the devices, the idea that Amazon is going to wade out into the sea of someone else’s vertical and catch fish for itself is not all that surprising.
But when the new vertical attack comes in an area that is actually directed to its eCommerce core business, it actually is.
And this week served up just such a “surprise.”
It appears that Amazon’s potential move into selling its own clothing line is growing ever closer to a reality, and the company might be taking another crack at its own diaper brand to boot.
That Amazon private-fashion label rumor has been making the rounds since last fall, but last reports indicated that such a launch is inevitable, not merely theoretically possible or under consideration.
Amazon is looking for fashion experts, said simply, with a job posting for “an entrepreneurial, analytical and highly motivated [senior] sourcing manager to join our team to launch new high-quality products for our global customers.”
And it’s not just clothes. According to different reports, Amazon might also be considering another attempt at manufacturing and selling its own line of diapers.
This would be a second bite at that apple. Amazon briefly tried and discontinued such a move last year.
A writer for Re/code reported last week that he was among the customers that Amazon emailed a few weeks back, requesting participants for a market research survey about products under consideration to be sold on the eCommerce site. Notable among the offerings was a new diaper brand called Mama Bear.
Amazon has no official comment. And, of course, Amazon routinely surveys its users on potential products; it does not end up releasing all of them.
So, what did we learn this week? Venmo is on the move, possibly faster than anyone thought. Facebook will be making money off of Messenger soon, though how remains to be seen. And if you sell it now, you should probably be pretty sure that, no matter what it is, Amazon will be trying to sell it, too, eventually. But, on the upside, you’ll be able to advertise on Messenger and let people Pay with Venmo. Ha!