Social Media Payments: Redefining Shopping for a New Era

Although social networks are a 21st-century creation, many of today’s consumers would be hard-pressed to remember a time before Facebook, Twitter, LinkedIn, or Google+. The worldwide adoption of social networks has altered the payment ecosystem: Social networks have now become an additional arm of payments and retail, rather than just a virtual place for individuals to socialize. Twenty-six percent of all consumers have made a purchase on a social network, and this trend has significant implications for e-commerce and traditional retailers, payment providers, issuers, and technology providers. This report explores the growth of social networks and the subsequent influence of social media in the payment realm, including changes to retail shopping, consumer behavior, and payment transactions.

Primary Questions:

• Why is social media important to the payment and retail worlds?
• Who makes purchases on social networks, and what type of purchases are the most common?
• Which brands do consumers trust the most when making purchases on social networks?
• What are some of the challenges facing social network payments?
• How can the unique characteristics of social networks be used beyond transactions?
• How can social media help foster in‐store sales using the mobile channel?

Companies Mentioned: 

Apple, Bill Me Later, Braintree, Chirpify, Facebbook, Foursquare, Google, Instagram, LinkedIn, MasterCard, Myspace, PayPal, Pinterest, Reddit, ShopBeacon, Shopkick, Starbucks, Stripe, Twitter, Visa

Press Release: 
62 Million Are Shopping on Social Networks

• A random‐sample panel of 3,509 respondents collected online during November 2013. 
• A random‐sample panel of 3,285 consumers with a mobile device (mobile phone or tablet) collected online during July 2013.