Facebook’s mobile revenue strategy has been one obstacle that CEO Mark Zuckerberg has been tackling as of late, and now the social network’s is trying to make another e-commerce push by minimizing risks associated with incomplete payments. To offer a seamless way for its users to make in-app payments using its mobile platform, Facebook is teaming up with Bango, a mobile carrier billing and analytics service.
The partnership will offer frictionless in-app purchases that won’t require payments through alternative means, like SMS messages or forcing Facebook users to type in their credit card numbers. With Bango, Facebook purchases will instead be reflected on the user’s bill from their mobile carrier.
Bango should be a boon to Facebook, and with it the social network can avoid the pitfalls of low conversion rates associated with other payment systems. Undoubtedly Bango’s claim that an average conversion rate of 77 percent for completed transactions is an attractive figure when comparing that to competing operator billing services that offer just a 40 percent conversion rate. And if that figure is as high as Bango claims, you should keep a watchful eye on purchases made by your children or even yourself, keeping in mind how much of an impact mobile carrier bills have on our wallets. We’ve all seen the bills younger users can run up when seamless transactions and in-app payments are implemented.
“We’re delighted to bring Bango’s payment experience to Facebook. As the mobile web experience has matured and improved, consumers are increasingly keen to purchase digital goods on mobile devices. By ensuring a frictionless payment experience, Bango technology is unlocking the business potential of the mobile web,” said Bango CEO Ray Anderson.
Facebook announced its intent to work with Bango as far back as February 2012. While the partnership will be one facet of Facebook’s mobile monetization strategy, it’s important to note that the money from in-app purchases pales in comparison to its advertising revenue.
And there’s more motivation to the deal: In an interview from last February, Facebook’s CTO Bret Taylor explained to TechCrunch that the partnership with Bango will benefit the developers building apps for Facebook. “It’s about making the mobile Web an easier platform for developers,” Taylor said. “Despite the mindshare that iOS and Android have, our mobile Web interface is bigger than iOS and Android combined.” Keeping in mind of Apple’s mobile success, you should be able to recognize why offering developers a platform and alternative revenue stream is just as important to the developers as it is to Facebook’s longevity.
Bango should also tie in seamlessly for native in-app features. The announcement comes just after reports surrounding the imminent launch of Facebook’s native in-app gifting service, Facebook Gifts, using the technology from its acquisition, Karma. The service will be launched later this year to Germany, the U.S. and the U.K.
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