You can now send cash to your friends instantly through Snapchat. Director of marketing at agency ntegrity Richenda Vermeulen looks at what this means for other social media platforms and Snapchat users.
Recently Snapcash was announced as a new feature within the hugely popular and ‘disappearing’ photo-sharing app, Snapchat. Snapchat users can now instantly send money to their friends through Snapchat’s partnership with Square, a US-based payment processing firm.
A move to add value for the users, or a conscious step toward monetising the platform? We see this as a major play in social commerce, look out Facebook.
Transfer money seamlessly
Rolled out in the U.S. for those over 18, Snapcash allows users to share money via their Mastercard or VISA at the press of a button. Working essentially identically to Square’s “Square Cash”, this partnership now gives Square a potential of 100 million users, making them a serious competitor to market leader, PayPal.
Paving the way for social commerce
At launch Snapcash targets peer-to-peer transactions, which opens the door for B2C transactions. This bold move has literally one upped Facebook’s “buy now” by injecting themselves straight into the ecommerce interface. In theory, Snapchat are cashing in on the step before ‘buy’.
So is Snapchat shopping next? We hope so. From new music previews, exclusive deals to fundraising and buying products, the opportunities for brands are endless. Especially if you were brand smart enough to stay ahead of the Snapchat trend.
Potential for targeted ads
As Snapchat progressively attempts to monetise their service through advertising, a recent discovery in the coding of Snapcash has revealed that there might be potential in developing targeted ads to its users.
However, this speculation is something Snapchat has not yet commented on. It could just be that Snapcash is one way for Snapchat to add value to their platform for potential investors. Reportedly, Snapchat is in talks with Chinese eCommerce giant Alibaba, valuing the Californian start-up at $10 billion. An impressive increase after rejecting an offer of $3 billion from Facebook.
But not all smooth sailing for Snapchat
Snapchat doesn’t have a great track record with security, with a few high profile security blunders under their belt, users may be hesitant to hand over their payment information. Lets not even get started on the implications for cyber-bullying, phone theft and the potential for solicitation of minors. These red flags alone may give any legal department a heart attack.
Red flags aside, Snapchat just entered the big leagues of social commerce and may be a formidable force for marketers to consider.