It’s easy to take for granted how valuable our smartphones really are.
We are constantly connected to the rest of the world in real-time through social media, where we have the ability to send instant messages, photos, videos, files – almost anything and everything!
So it shouldn’t come as a surprise that we can soon expect sending and receiving money via our favourite social media apps to become the norm.
Gaining the attention of Airbnb, the rise of social payments is set to further disrupt the banking and financial services industry.
But how does the trend look to benefit businesses?
What are the pros and cons of distinguishing your own app with social payments?
1. A seamless experience for customers – pro
Part of the appeal of social payments is the ease of access they allow users.
The addition of social payments to existing applications allows apps to offer more than a singular service.
This ease of access means users no longer have to employ a variety of apps for different functions and can instead use just one app for a variety of purposes.
The success of Facebook’s ‘Marketplace’ is a case in point. Users are able to shop amongst a large community whilst remaining in the Facebook app.
Marketplace invites users to do more on Facebook than simply interact with existing friends via their News Feed.
Instead, they are able to sell and shop on a platform that resembles similar ones already on the market, like eBay or Gumtree without leaving their favourite app.
2. A unique selling point – pro
Social payments allow organisations to distinguish themselves in an increasingly competitive market.
Adding social payments to an app allows businesses to grab customers’ attention, and increase customer engagement and satisfaction.
In a similar fashion to Facebook introducing live video streaming in 2016, Snapchat has also attempted to diversify their offering by introducing ‘Snapcash’; a service that allows users to send money to friends and followers through the app’s chat function. I say attempted as it is yet to become a product you hear of people using.
By bringing novelty into play, a unique offering like this can be greatly effective in attracting users to an app for more than one service.
3. An investment – con
Before you jump on the bandwagon, it’s important to consider that while social payments may be intriguing for many businesses, they are still a hefty investment requiring money, time and resources.
Cost-effectiveness must be the most important factor to consider before integrating mobile payments into your app.
Ask yourself, ‘Is it financially plausible, and can I justify this expense in terms of ratio? How much does it cost to build the app against how many people will actually use it?’
XOPO, which allows customers to transfer money to their friends and followers easily without requiring bank details, has found success by utilising existing popular social networks like Facebook.
Just like any marketing effort, you must ensure your audience is actually there before you even attempt to reach them with your targeted message.
Despite the obvious risks all new offerings carry, social payments could very well change the entire mobile app game.
With more users looking to use just one app for all their needs, I predict we will see more and more products offering a seamless and holistic service for users.
The Future of Social Payments
The idea of social payments is focused on customer experience, with Apple Pay and Google Wallet leading the way with their card-less payment platforms.
You’ll find startups popping up all over the globe offering differentiated social payment options that businesses can integrate into their mobile apps for a smarter and easier payment solution.
The question you need to ask yourself, is how can I simplify the process of customer payment in my organisation to improve my customer experience?
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