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For shoppers, paying for what they want is a necessary evil at best and a complicated chore at worst (especially online). That inherent aversion to the transaction phase is one reason payment companies are eager to expand to other parts of the shopper journey. McKinsey calls this embedded finance. This is when a financial product or solution is placed in a non-financial environment, such as a social media platform or storefront (private label credit cards are one classic example he has).
Embedded finance has become big business: McKinsey estimates the sector has reached $20 billion In 2021, the U.S. alone will see revenue growth, double then with three to five Year.
Given these numbers, it’s no surprise that space competition is fierce. Retail is a central battleground. and 50% Percentage of global spending in the US that takes place online, digital payment solutions such as Venmo When PayPal (who has owned Venmo since 2013) is well positioned to capitalize on this opportunity.
As other payment solutions are differentiated with multiple retailer rewards programs, browser extensions and even creator marketplaces, Venmo is betting that its initial success will help it rise to the top of the embedded payments mountain community.
Denise Leonhard, Vice President and General Manager of Venmo, said: retail touchpoints Learn why Venmo stands out from the competition (including PayPal) in this hotly contested space, and how the platform’s native social sharing features give Venmo an edge.
Retail Touchpoints (RTPs): The world of payments is a very exciting place right now. Tell us how Venmo is capitalizing on this momentum.
Dennis Leonhardt: Retailers need access to far more and different channels than before, and it’s not just the products themselves. Consumers also want a seamless payment experience with brands they trust. That’s why Venmo offered two different products to help retailers large and small do just that.
Enterprise solutions have payment via Venmo checkout. grub hubsand liftOf the world.
Then on the smaller side for sole proprietors, casual sellers, and users with side businesses, there is the Venmo Business Profile. What people can do is accept payments for goods and services. Grow and sell your business with the Venmo platformWhether you’re an artist selling crafts at a fair, a barber shop offering unique haircuts, or a florist down the street, use these business profiles to interact and sell on the Venmo platform. We are talking about the excellent products of We launched the service a little over a year ago and have already 1.5 million Small business with profile.
Venmo is so seamless and easy to accept, People are using it and actually spending more. Shoppers actually 90% We know Venmo users shop because they are more likely to complete purchases with Venmo than with traditional payment methods. 2X shop more often than the average shopper 19% more likely to make repeat purchases.
for example, presseda quick-service restaurant serving juice, 57% Higher average order value for memberships through Venmo than traditional credit cards.Our merchants are seeing higher conversion rates and as a result Seeing Huge Volume Growth Within Venmo — 250% YoY.
RTP: How does this fit into the larger PayPal ecosystem, especially when two brands offer similar services? Have you ever felt like you were competing with yourself?
Leonhardt: The interesting thing about PayPal and Venmo is that the consumer base overlap is not 1:1. In reality, there are tens of millions of people who just have Venmo accounts. So with the Pay with Venmo checkout button, tens of millions of people who don’t have a PayPal account can seamlessly checkout with Venmo on their behalf.
PayPal also has its own small business solution, [those business profiles] I said I only sit on the Venmo platform. They are also unique because of the way Venmo profiles exist alongside their social feeds. [attributes] Anything a business can leverage to market within Venmo cannot necessarily be done with PayPal.
RTP: What consumer payment trends are you currently tracking to stay ahead of Venmo?
Leonhardt: (laughing) Before PayPal american express, so I’ve been thinking about this for over a decade. What I find most interesting right now is this social component happening with payments. Instagram When tick tock, You can seamlessly purchase the recommended products and feel that their payment solutions are really integrated. I think it is very interesting that the
There’s always an opportunity to make payment as seamless and easy as possible and make it feel like it’s part of the overall experience. Whether it’s social platforms or traditional retailers, there are still opportunities.
What I find interesting is the verticals that are actually taking off within Venmo.A large amount of traction is found in places such as food delivery, Grubhub, Uber Eats, DoorDash, and more.We also see a lot of movement travel — Uber, Lyfts, Booking.com (which is a new merchant for us) — and around entertainment, so Ticketmaster, AMC, FanDuel, DraftKings.and finally fashion,for example Poshmark, Abercrombie & Fitch, stitch fix.
All of these merchants looking to target Millennials and Generation Z really see an opportunity to tap into Venmo’s consumer base to really get them. All of these categories also have social sharing elements synonymous with Venmo. If you’re thinking of buying food with your roommate or splitting an Uber, The sharing and social aspects of that are all starting to become part of the deal as well.
RTP: Venmo’s roots lie in peer-to-peer payments, which are still a big part of our business. How do you balance the needs of these two very different sets of clients as you move into the enterprise space serving brands and businesses?
Leonhardt: Whenever we talk to Venmo’s user base, every survey shows consumer love for Venmo. They tell us how easy and fun it is to use Venmo, and that they want to use it in more ways. [business] The solution is an extension of that.
For example, I have a farmer’s market down the street that I go to every week. I know the name of the vendor. At this point they are mostly friends. Often these small businesses are extensions of friends and family, the next tier of the local community, so it’s a very natural extension. [for Venmo]I mean, remember how painful it was to have to get cash for your babysitter?
And on the checkout side, consumers wanted to be able to use Venmo in more places, to be able to use their balances, to be able to pay seamlessly elsewhere, so that was me. It was a natural extension for us.
RTP: We know that when retailers offer these more convenient payment solutions, there are huge benefits in terms of conversion numbers and customer satisfaction, but too many options clutter the moment of that transaction. With so much competition at the enterprise level, what is Venmo’s pitch to big retailers?
Leonhardt: There are 3 things. One is that the Venmo community is coming 90 million US Consumer — One in three Americans has a Venmo account. We are really part of the consumer’s daily life, so we have so many audiences built in. Second, shoppers also 90% You’re more likely to complete purchases with Venmo than with traditional payment methods. People are actually converting at checkout because it’s seamless and easy. The third is all the great interactions that happen within the Venmo app. Here you can review your purchases and share them if you wish.
RTP: What is Venmo’s ultimate goal in the world of commerce? There is a lot of confusion going on, especially right now.
Leonhardt: Our biggest goal is to be a really simple and easy way for people to pay not only their friends and family, but also local businesses and brands they love. Basically giving consumers more opportunities to use her Venmo.
And not just online. For merchants, we have both static and integrated QRC (QR Code) functionality. A static is simply a static QR that formalizes your business profile, as simple as a placard you place in your store or market stand or hang around your neck when selling. And there are integrated QRC solutions that you can see in places like: CVSYou can purchase via PayPal or Venmo from the integrated QR.
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