Facebook on Tuesday signalled its ambitions to grow as a payment platform, with changes to how its users can buy goods and services without leaving its site. The move will be welcomed by investors who have been fleeing from Facebook stock since its IPO over worries about the firm’s inability to make money on mobile.
Until now users could only buy items using Facebook credits which were mainly used for virtual purchases in games like Farmville. The new system will allow users to plug in their credit card information once and store it on Facebook, just as they could to buy Facebook Credits. But now, with one click, they will be able to buy whatever is on offer, priced in their own currency: a magazine subscription in euros, say, or concert tickets in dollars or games in Indian rupees.
Users will also be able to subscribe to services that require monthly payments like music streaming service Spotify, without leaving the social networking site.
As yet there isn’t a whole lot to buy on Facebook although this is likely to change fast when the changes are implemented next month.
Apart from the obvious benefit of bringing in more revenue the move will also provide Facebook with valuable data about what their users buy. The announcement shows investors that the company is looking at new revenue streams other than advertising. Facebook may well also follow rival Google into the hardware game after rumours emerged last month about a possible Facebook phone.