Facebook wants to create a more seamless solution to payments – instead of just adding a hyper-link to a website. In a recent update, Facebook might have found the solution, adding mobile payments inside the app itself.
Suggested posts and curated ads will now show a ‘Buy’ button underneath the advertising, allowing the user to buy the product within the app. This could be anything from virtual apps/media to real life products.
This should open up Facebook to more tangible products, instead of advertisement. Products that can be bought on Amazon.com and other online retailers will most likely do well and Facebook can even offer flash sales.
Facebook is not the only company looking to add payments into the app, Snapchat recently filed two trademarks for the same thing, allowing users to pay for products in the application.
The two differences between Facebook and Snapchat include Snapchat’s audience being younger and potentially better customers for media and apps and Snapchat being able to pull off flash sales a lot better.
Facebook, on the other hand, has a better understanding of what users will become customers, thanks to likes, search integration and status updates, all showing what a user would be interested in purchasing.
Mobile payments are starting to become a real crucial thing for an app to offer, Google is working on integrating this into Search, which would be huge for advertising on mobile, still worse than on the Web in terms of traction per ad.
Facebook already has enough of a diverse audience to not worry about backlash, but for Snapchat this could be devastating for the teenage audience, who might not like the idea of becoming a product for advertisers.
No word on how much this could potentially net Facebook in the opening year, but we expect seamless product integration with the Facebook app is a huge change, especially for mobile.