This is Part 3 of the Retail TouchPoints Payment Report. View Part 1, or Part 2. Click here to download the full report.
Social media channels are proving to be a valuable tool for targeting customers and building brand loyalty as an increasing number of retailers team up with social media outfits and financial services providers.
“More and more vendors and content owners are exploring social media payment platforms,” said Lie Luo, Senior Consulting Manager at Global Intelligence Alliance, a strategic market intelligence firm. In fact, revenue generated by the sale of virtual goods in social networking and online gaming worlds is estimated to be worth $14 billion by 2014, according to In-Stat.
Typically, digital offerings require consumers to visit another e-Commerce site to complete their purchases. Social media platforms, on the other hand, “are fast, efficient and provide consumers with instant access to the content and features they want on the very platform they discover and share this content,” said Luo.
Advertisement
To tap into this trend, in February, Foursquare expanded its Specials for Credit Cards program to allow consumers to sync their Foursquare account with their Visa, MasterCard, and most debit cards, in order to receive special discounts from select retailers. First Data’s OfferWise technology powers the card-linked service, which can be deployed off-the-shelf by merchants.
For First Data merchants, location-based social networks such as Foursquare are not only a potential path to increased sales but a convenient, time-saving point-of-sale experience for consumers. Users simply check-in at participating First Data merchants, and pay for their purchase with their connected card. Foursquare later notifies them that a discount has been automatically applied to their credit card.
“We partnered with First Data to make this a really simple process for the merchant,” said Jake Furst, Foursquare’s Director of Monetization Partnerships. “They literally just need to sign up, tell us what the offer is and that’s it.”
Card swiping for savings is hardly new but social networks promise to deliver retailers something digital coupons can’t: a customer’s trust. “We’re a platform that our customers turn to in order to decide where to eat, where to go for arts and entertainment, where to shop,” said Furst. “We’re not an app that someone turns on only when they walk into a grocery store. We’re a solution that helps them make good decisions; because of that, there’s an inherent trust.”
Instant access to a key target audience is another reason why more and more retailers are tapping into social networks as payment processing platforms. Restaurant retailer Jamba Juice, for example, is a participating retailer in Facebook’s gift card program. Facebook Card is a reusable gift card that lets Facebook members purchase and send the gift card to their social-network friends. Members need only access the card from the “Gift Cards and Digital” category within Facebook Gifts to select a retailer and specify an amount. The recipient is then snail-mailed a plastic Facebook Card.
With more than one billion active users, Facebook Cards grant participating retailers like Jamba Juice, Olive Garden and Sephora a chance to access an ever-widening array of potential customers.
“There’s a viral quality to social network programs like Facebook Card,” said Julie Washington, Jamba Juice’s Chief Brand Officer. “It’s not just Jamba Juice’s one million Facebook fans that we’re reading out to. The program also extends into Facebook’s network which brings us into many different places and demographics.”
Furst of Foursquare agrees. By relying on its location-based service, Furst said participating merchants can reach an audience of “young, affluent people who have smartphones.”
But that’s not all. Although Jamba Juice said it has yet to begin collecting data about its Facebook Card users, social networks are in the unique position of being able to offer merchants access to mounds of personal data.
“From a marketing standpoint, Facebook Cards lets us learn a little bit about these consumers and it’ll help us better target them,” said Washington. “It provides another conversation venue and enables us to talk to some new customers.”
Even tweets are joining today’s growing collection of social media payment options. In March, Twitter inked a deal with American Express that lets customers sync their cards with their mobile app to qualify for discounts and special returns. All customers have to do to qualify is tweet a special hashtag.
Complete the form below to download:
