The product Facebook is testing with a group of commerce companies allows users to make purchases on mobile apps using their Facebook login information, according to an All Things D report. Facebook already holds the details of millions of credit and debit cards from users who have paid for virtual goods on the site.
Facebook spokeswoman Tera Randall says: “The product is simply to test how we can help our app partners provide a simpler commerce experience. This test does not involve moving the payment processing away from an app’s current provider”
The feature would likely be welcomed by e-commerce companies as it would remove the need fill in credit card details and delivery address forms, which can often be arduous to complete on a mobile phone.
The product could also increase the amount of direct sales Facebook advertising produces. The social network has previously been criticised for not doing enough to prove the return on investment from advertising with its service to marketers, although the received wisdom now is that Facebook fan engagement can drive sizeable uplifts in sentiment, engagement and brand loyalty.
If the payments service moves beyond testing, Facebook would also be able to provide brands with insights into consumers’ shopping habits. Earlier this week eBay announced it is to share data with retailers to enable their shopping assistants to see information about the purchasing habits of individual customers in real time.
Facebook’s revenue generated from payments and other fees totalled $214m in its second quarter, just a fraction of the $1.6bn it generated in advertising.