When Crowdcentric ran CROWDFUNDx NYC last month, one of our panelists was General Assembly Co-founder, Matt Brimer. Out of all the great content that came out of that panel, one of the things that Brimer said really stuck with me as a truth in this world of constant social & digital connection.
Brimer mentions that in regards to any business now a days and moving forward, the question becomes less of who do I want to compete with and more of who do I wish to collaborate with.
I believe that is an extremely powerful statement that really plays an integral role in how we think about and utilize social platforms, education, and human betterment.
Amongst all the adverse effects that social media and the digital world can have on us, there is tons of positivity that can flow from the great technologies that we are constantly being introduced to. And if the true purpose of all these social outlets is to change the world for the better, then collaborating with others towards a common purpose should be something we all strive to do.
In recent tech news, Facebook is testing a billing info feature that would make it easier for people to pay on e-commerce sites whether or not prompted through Facebook ads. When this news first broke, AllThingsD thought that such a product was Facebook’s attempt to directly compete with PayPal’s payment system, when in fact their intentions were quite the opposite.
Facebook’s new product is not the development of a payment processor, like PayPal or Stripe, but rather a billing info system that will allow users on commerce sites to have their info stored, so that with your permission you do not have to fill in your billing information every time you want to make a purchase. This is very useful and convenient, as normally having to enter your information can act as a dissuasion for buying something.
The reason that this actually benefits payment processing companies is because Facebook doesn’t actually process these online payments. They simply work as a middle-man that allows you to easily make a payment, which would then go through the payment processor that the e-commerce site normally uses, such as PayPal, Stripe, etc. A very comprehensive and well-written article on Tech Crunch on the topic sums it up: “In effect, Facebook’s payments feature is a data layer that rides on top of other payment services rather than competes with them. This is similar to how Facebook doesn’t compete directly with iOS and Android, but is instead a social layer on top of them.
This feature is also very beneficial to Facebook and advertisers alike. Rather then using it to turn any sort of profit, Facebook is utilizing it as a tool to make their current ad’s (which accounts for pretty much all of their revenue stream) more relevant. If you click-through on a Facebook Ad, which charges the advertiser a sum of money, and then make a purchase on that site using Facebook’s fill-in billing feature, Facebook can then notify the advertiser that their ad placement provided them with a return. This is crucial for keeping current advertisers happy by giving them relevant data, and also critical in convincing potential advertisers the positive effects of ad placements. Users can also be notified when they successfully provide a company with an ROI.
Now, Facebook does have the resources and abilities to become a third-party payment processor. However, instead of taking this route, which would thus make them a direct competitor of PayPal and the likes, they decided to take the higher road and create a feature that would prove beneficial to their current clients, users, and of course the other processing companies that will hopefully see more traffic because of this effort.
While physical collaboration with PayPal might not have occurred, the lesson to learn is that using available resources to help others is something that will lead to overall significance and effectiveness. Whether it be aimed at e-commerce, education, or just personal activity, collaborative efforts are as important as ever and is of overlying significance if we truly wish to make positive reforms and impacts in this world.
Written in a collaborative effort with Ryan Thompson.