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Facebook Begins Testing Mobile Payments for Virtual Currency with Zong
August 25th, 2009
| By Justin Smith | 50 Comments » |
We’ve been speculating for a long time that Facebook would begin testing alternative payment methods for its virtual currency, Facebook Credits. Well, Facebook’s first mobile payments test is now live through mobile payment provider Zong.
The user experience is very similar to the flow Zong and other mobile payment providers have integrated into many Facebook applications and social games. When users purchase Facebook Credits in the Facebook gift shop or in a limited number of Facebook applications, they’re now being presented with two payment options: mobile phone or credit card. Here’s how it looks (images courtesy of Payments Views):
First, users are presented with a new mobile payment option.
When users choose the mobile option, they enter their phone number and a confirmation PIN is sent via text message.
When the PIN is entered in the gift shop checkout confirmation, the Facebook Credits are billed to the user’s account with the mobile carrier.
Facebook confirmed the tests to us this afternoon, saying: “We are looking at extending our virtual currency — Facebook Credits — via a very small alpha test with a handful of developers. As part of this test, we are working with Zong to explore ways for users to easily purchase credits and virtual goods by entering their mobile number, rather than credit card information, in the supported application. It’s also available as a payment option in the Gift Shop for a small group of users.”
Zong’s VP of Product and Marketing Hill Ferguson added, “As Facebook identifies ways to incorporate Facebook Credits into third party applications and help developers monetize their applications, we are testing an integration that would allow users to purchase Facebook Credits through our mobile payments service.”
Interestingly, as you may observe above, Facebook Credits cost more when paying through mobile compared to paying through credit card (USD $0.20 per credit with Zong vs. USD $0.10 per credit with credit card). Why? The simple answer is that mobile carriers currently charge high commissions for premium SMS payments in the United States – sometimes as high as 50%. So even though a Facebook Credit costs USD $0.20 through mobile, Facebook itself is likely seeing roughly the same net proceeds after the carriers (and Zong) take a cut.
The test is a big step for Zong, as it seeks to grow its worldwide customer base. As we wrote yesterday, “Given that 70% of Facebook’s audience is outside the United States, it only makes sense for Facebook to make it easier for users to make purchases using whatever payment methods are available to them.” We expect Facebook to start tests with more payment partners in the future. Decreasing payment friction is a vital step toward increasing direct virtual currency sales.
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August 25th, 2009 at 6:33 pm
[...] [via Inside Facebook] [...]
August 25th, 2009 at 8:27 pm
“USD $0.20 per credit with Zong vs. USD $0.10 per credit with credit card” – clearly not the best way to establish Zong as a second payment option quickly, if users can easily see that they pay double the price compared to a credit card payment.
Zong claims that their benefit is a much higher conversion rate, resulting in a higher net revenue.
Therefore the application developers should take this higher revenue potential and cover the higher commissions by offering the same price for each payment option – especially since we’re talking about high margin virtual products.
August 25th, 2009 at 10:16 pm
pin sms is non-compliant. careful, facebook!
August 26th, 2009 at 5:11 am
[...] Facebook Begins Testing Mobile Payments for Virtual Currency with Zong [...]
August 26th, 2009 at 5:29 am
thanks
August 26th, 2009 at 5:46 am
[...] Facebook tests mobile payments through Zong [Inside Facebook] [...]
August 26th, 2009 at 1:00 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 26th, 2009 at 2:00 pm
[...] Facebook spokesperson confirmed the tests with Inside [...]
August 26th, 2009 at 2:05 pm
[...] Facebook Begins Testing Mobile Payments for Virtual Currency with Zong, Inside Facebook [...]
August 26th, 2009 at 2:15 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 26th, 2009 at 2:28 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 26th, 2009 at 9:58 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 26th, 2009 at 11:54 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 27th, 2009 at 5:31 am
[...] partner seçerken PayPal kendi servisini mobil cihazlar üzerinde yaymaya çalışıyor. Inside Facebook‘un ulaştığı bilgiye göre Facebook küçük bir alpha grubu ile mobil ödeme denemelerine [...]
August 27th, 2009 at 1:59 pm
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to their blog. [...]
August 27th, 2009 at 10:11 pm
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to their blog. [...]
August 28th, 2009 at 12:13 am
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to their blog. [...]
August 28th, 2009 at 2:03 am
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to their blog. [...]
August 28th, 2009 at 5:07 pm
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to the InsideFacebook blog. [...]
August 28th, 2009 at 11:08 pm
[...] to spend real money to shower their friends and family with virtual gifts. Earlier this month, Facebook started testing the use of mobile payments for its virtual currency, Facebook Credits. Facebook has partnered with mobile payments service [...]
August 31st, 2009 at 4:42 pm
[...] busy testing out other virtual currency features. Last week, it also introduced a way for people to buy Credits through their phones, in partnership with mobile startup Zong. Add Comment [...]
August 31st, 2009 at 11:39 pm
[...] So Facebook is starting to get in to the deep end of the online game – they are looking to create a virtual wallet, according to the InsideFacebook blog. [...]
September 1st, 2009 at 6:00 am
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 1st, 2009 at 7:21 am
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 1st, 2009 at 8:03 am
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 1st, 2009 at 12:01 pm
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 1st, 2009 at 7:54 pm
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 2nd, 2009 at 3:07 pm
[...] Zong, has also witnessed strong growth over the past few months. Most recently, Zong was chosen to test a pilot program for mobile payments for Facebook’s virtual currency, Credits. While [...]
September 4th, 2009 at 9:45 am
[...] to mainstream this trend should not be overlooked. The company has begun testing mobile payments via a partnership with Zong which would allow users to purchase Facebook credits via their cell phones. Although not in effect [...]
September 4th, 2009 at 9:51 am
[...] to mainstream this trend should not be overlooked. The company has begun testing mobile payments via a partnership with Zong which would allow users to purchase Facebook credits via their cell phones. Although not in effect [...]
September 4th, 2009 at 11:30 am
[...] point out that just last week, Facebook announced a virtual mobile payment deal with Zong. The mobile app will let verified users purchase Facebook credits using only their cell number [...]
September 4th, 2009 at 1:26 pm
[...] to mainstream this trend should not be overlooked. The company has begun testing mobile payments via a partnership with Zong which would allow users to purchase Facebook credits via their cell phones. Although not in effect [...]
September 4th, 2009 at 3:17 pm
[...] point out that just last week, Facebook announced a virtual mobile payment deal with Zong. The mobile app will let verified users purchase Facebook credits using only their cell number [...]
September 4th, 2009 at 3:22 pm
[...] point out that just last week, Facebook announced a virtual mobile payment deal with Zong. The mobile app will let verified users purchase Facebook credits using only their cell number [...]
September 4th, 2009 at 10:32 pm
[...] point out that just last week, Facebook announced a virtual mobile payment deal with Zong. The mobile app will let verified users purchase Facebook credits using only their cell [...]
September 5th, 2009 at 3:03 am
[...] to mainstream this trend should not be overlooked. The company has begun testing mobile payments via a partnership with Zong which would allow users to purchase Facebook credits via their cell phones. Although not in effect [...]
September 7th, 2009 at 8:04 am
[...] essais sont en cours, menés notamment par Facebook, Mastercard ou Visa. Je serais curieux de connaitre également la position de Paypal, qui ne reste [...]
September 13th, 2009 at 4:59 pm
[...] 有的人則打算透過社交網路──對，就是Facebook──來推動行動付款。雖然成效尚未可知，但也是另外一種方式。在Facebook上購買商品，只要填入你的手機號碼，錢就會扣在你下一期的手機帳單裡。 [...]
September 18th, 2009 at 8:11 am
[...] business while PayPal is trying to promote its own service on mobile devices. According to an info Inside Facebook got, Facebook has started testing mobile paying by a small alpha group. They are expected to put [...]
September 22nd, 2009 at 5:51 am
[...] with Boku making acquisitions and expanding internationally and Zong picking up traction via a partnership with [...]
September 22nd, 2009 at 6:00 am
[...] with Boku making acquisitions and expanding internationally and Zong picking up traction via a partnership with [...]
September 24th, 2009 at 12:52 pm
[...] Facebook mobile payments, enabling users to buy Facebook credits by billing their mobile accounts [...]
October 21st, 2009 at 4:19 pm
[...] availability of its virtual currency, Facebook Credits, for purchase in more currencies and through more payment methods recently, and we expect those tests – as well as tests of Facebook’s platform payment [...]
October 29th, 2009 at 1:54 am
[...] and sure enough, less than one year later, the startup is picking up serious traction, including a partnership with Facebook to power the purchase of the social network’s new currency. And in 2009 alone, [...]
October 29th, 2009 at 5:45 am
[...] and sure enough, less than one year later, the startup is picking up serious traction, including a partnership with Facebook to power the purchase of the social network’s new currency. And in 2009 alone, Zong [...]
October 29th, 2009 at 7:41 am
[...] and sure enough, less than one year later, the startup is picking up serious traction, including a partnership with Facebook to power the purchase of the social network’s new currency. And in 2009 alone, [...]
October 29th, 2009 at 2:21 pm
[...] a user wants to, say, buy some more virtual poker chips for a poker app on Facebook or MySpace, or buy Facebook Credits, Zong lets them pay using their mobile phone account. A user first clicks on the Zong logo within [...]
November 4th, 2009 at 10:20 am
[...] los pagos realizados a la cuenta del móvil utilizado. Recientemente la compañía ha anunciado que firmó un acuerdo con Facebook para mejorar la compra de “Facebook Credits“, la moneda virtual de [...]
November 11th, 2009 at 4:53 am
[...] en la difusión de esta tendencia. La empresa ha comenzado a hacer pruebas de pagos móviles mediante una asociación con Zong que debería permitir a los usuarios comprar créditos de Facebook mediante sus móviles. Aunque [...]
December 31st, 2009 at 7:37 pm
[...] еще FB начали тестировать мобильные платежи через ZONG, что очень интересно. VN:F [...]