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Venmo’s Move to Retail: Why You Should Accept Another Mobile Payment Option

Turning Venmo Into a Mobile Payment Powerhouse

Unlike its big brother PayPal, which started as a secure online Payment for merchant purposes, Venmo has roots only as a peer-to-peer mobile payment option. Individuals, mostly millennials, utilize the app for splitting the dinner bill, for AirBnB bookings, and for settling up after happy hour. Venmo’s uses within the peer-to-peer market were varied, and many individuals forgot what life was like before instant peer-to-peer payments. If checks weren’t obsolete before Venmo, then this mobile payment option replaced their last true use. Venmo also left online banking in the dust. Traditional banking institutions are incredibly cautious about peer-to-peer payments, with many still requiring a lengthy input of information and “test” deposits before a peer-to-peer payment can process. It is a process that demands days of waiting in order to add another account. Venmo only needs to be linked to a bank account once, and then sending to another user takes under a minute. Only now are banks realizing the utility of allowing their account holders to transfer funds seamlessly in a Mobile app. Venmo became the most popular peer-to-peer mobile payment option in the United States, all while most users didn’t realize it was part of the PayPal family. You can even make Venmo payments through Facebook Messenger. Before there was Venmo, transfers between two people represented an unconquered niche market, and that niche became the place Venmo happily resided. Until now.

What Will the New (and Improved) Venmo Do?

Yesterday, parent company PayPal announced plans to implement Venmo for U.S. retailers. The news transitions Venmo’s business from peer-to-peer mobile payment option to a digital wallet. The strategic change to Venmo’s core concept highlights the consistent increase in mobile shopping and retailers’ corresponding desire to reach more mobile shoppers. The news could be a big deal for Venmo’s seven million active users and is a great sign for eCommerce companies that have focused on mobile sales. Based on PayPal’s recent announcement, Venmo is now accepted by almost every U.S. seller that currently accepts PayPal as a mobile payment option. By the company’s count that is over two million businesses with the capability to accept payment via Venmo, and this count includes some of the largest retailers in the country. It also includes a huge number of independent online retailers, small businesses, and startups. ECommerce companies aren’t the only beneficiaries of Venmo’s commercial expansion; the mobile app can also be used to make charitable donations. The acceptance of payment either in-app or through mobile payment processing is a good way for charities to tap into smaller, but more frequent, donations from individuals under 35. Many people in the age bracket 25 – 35 (Venmo’s demographic) are experiencing their first taste of disposable income and have some cash to spread around. However, these spenders aren’t available for a substantial or recurring donation. Plus, they are incredibly engaged and partial to “of the moment” or viral causes. Smaller amounts sent on Venmo are the perfect compromise, and U.S. charities should be equally excited about an easier method for sending donations.

Bringing Venmo’s Mobile Capability into Focus

Admittedly, Venmo can be accessed and utilized through a desktop or laptop computer, but the company’s data indicates that nearly all Venmo payments are sent and received via its mobile app. The company processed $6.8 billion in mobile payments during the first quarter of 2017, a record for the business and a big boost to PayPal’s overall earnings. These numbers are a 126% increase in dollar amount over the same quarter in 2016. The numbers are expected to be even higher for later in the year.  The continued increase in peer-to-peer payments via Venmo is a good indication of the growing comfort with digital payments. Venmo users don’t hesitate to provide payment to friends, family, and acquaintances in the digital format, and Venmo’s security measures provide adequate assurance that personal information isn’t compromised in the process. This comfort is likely to translate to merchants easily, as the parent company has promised that all payments through Venmo will be backed by the same payment protection as PayPal. ECommerce companies can utilize Venmo’s security and its payment protection as top selling points to mobile shoppers. Another reason eCommerce companies should be overjoyed to see another mobile payment option enter the marketplace is Venmo’s ability to breakdown the door on mobile shopping’s biggest barriers. Lack of speed and efficiency are the two biggest reasons customers don’t complete mobile purchases. Venmo’s mobile focus is attractive to eCommerce companies, as mobile payment options make it even faster and easier to complete a transaction. Of course, in exchange for this added convenience and access to mobile buyers, Venmo will charge businesses a fee to process payments.

Tapping into the Millennial Market

Millennials are the ideal mobile shoppers. They are adept at using mobile apps and responsive websites for shopping, comfortable with digital payments, and more engaged with online brands and sellers than their older counterparts. As if these qualities didn’t make millennial shoppers appealing enough, they are much more comfortable discussing where and how they spend money. Sharing information on their spending habits, whether with a business or friends, isn’t taboo, as it was typically viewed by previous generations. In fact, millennials are often providing this information out of habit, not reluctance. The combination of engagement and information sharing makes the millennial shopper valuable to online brands beyond an initial purchase. These are consumers that can be enticed to return. Their shopping preferences and habits are discernible. Where can an eCommerce company find more of these buyers? Interestingly, through their choice in mobile payment option. The driving force behind Venmo is its millennial users. They account for the vast majority of the app’s users and send far more peer-to-peer payments than any other demographic. In particular, Venmo is popular with urban millennials, who are also the biggest spenders at startups and small eCommerce companies. As Venmo’s capability expands to commercial spending, it is bringing these millennials along for the ride. Hopefully, that ride ends at your eCommerce company’s checkout.

Advice on Mobile Payments & Mobile Websites

Decisions on mobile payments and how to implement the latest mobile payment option into your online store requires knowledge of digital marketing, eCommerce-centric web design, and even web development. Finding all these skills can seem like an impossible task, until you are introduced to the incredible team at 1Digital Agency. Ask questions from our mobile-friendly team here.

The post Venmo’s Move to Retail: Why You Should Accept Another Mobile Payment Option appeared first on 1Digital®.



This post first appeared on Ecommerce Blog - 1Digital® Agency, please read the originial post: here

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