Will Millennials Drive Your Payments to Social Media?

Many companies restrict access to social media sites like Facebook and Twitter during working hours in an attempt to boost productivity. Those restrictions are becoming harder to justify as real work moves to those sites; social media is now an important source of customer support and marketing information. While that’s mostly consumer-oriented now, B2B is sure to follow, especially as Millennials begin to dominate in business.

Millennials don’t just use social media for posting selfies and status updates. They use social sites to send peer-to-peer payments (P2P) for the kind of casual funds transfers needed to settle up after splitting a dinner bill or to split the rent with a roommate. Now social sites are incorporating payment methods that could let them pay that dinner bill directly from the site. Just as Millennials’ attachment to their phones has spurred mobile computing and BYOD for business, their acceptance of these social media payment methods may lead to using these sites to pay for business expenses, at least for purchases of the kinds of products that don’t require specially negotiated contracts.

Online and Retail Purchases from Apps

The social site, Venmo has always had P2P payments as its core function. That app is now expanding to support in-app purchases from retail businesses. But that’s always been a social payments app without the other “sharing” functions that lead people to spend hours on social media.

Facebook, of course, is all about sharing photos and status updates. It also currently supports P2P payments through Facebook Messenger, linking transfers to a debit card and depositing funds directly in the recipient’s checking account. Now Facebook is reportedly building point of sale functionality into Facebook Messenger, and even potentially incorporating Apple Pay. With this capability, Facebook Messenger would be able to be used for purchases in real world shops, not just online sites. For users, this would eliminate the need to stand in line at checkout counters.

Although Facebook hasn’t announced this capability officially, it’s worth noting that Facebook has partnered with KLM to use Messenger to deliver flight status updates. It’s not a stretch to envision messages that offer upgrades and in-flight services to be paid for directly from Messenger. Facebook recently began allowing retail purchases from within Messenger.

Twitter is also incorporating payments technology into the app, through a Buy Now button that can be added to tweets. With Twitter a source of customer support and problem resolution, this could lead to corporate purchases made as part of efforts to solve a problem.

Payments from these apps mean payment information needs to be stored as part of users’ profiles in the apps. This means the security of these sites becomes more important. For sites where privacy previously meant limiting who can read your status updates, protecting payment information may present new challenges.

Mobile Payments Increasing Sharply

Businesses that accept payments are likely to incorporate these social payment methods. Social media is a big influencer of consumer purchases, and allowing customers to buy directly from within those sites is likely to lead to increased sales for them. Because the purchase can happen immediately, there’s less time between the buying decision and the buying action. Of course, when this occurs for B2B purchases, this can mean there’s less corporate oversight and input from colleagues before making a buying decision.

One of the reasons mobile payments aren’t widely used is there are so many potential methods of payment and it’s often unclear to end users what the benefits of the methods are and where the methods are accepted. Despite this, mobile payments in the US are expected to triple in 2016. As the apps Millennials use daily begin to support payments, that will further drive the usage of phones for payments. Millennials won’t want to switch to other apps for payments, and companies will need to recognize and allow the usage of these sites to pay for legitimate business expenses.