How would you decide whether or not to accept payments for Facebook messenger?

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How would you decide whether or not to accept payments for Facebook messenger?

Asked at Meta (Facebook) over a year ago

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Santhosh Kumar · Answer 1 · 2021-10-06T01:46:18+0000

Approach: I would asses the advantages and disadvantages with accepting or not accepting payments, and how the payment product helps to advance the mission of the company to bring people together.

Clarifying questions:

Candidate: Is it used for peer to peer money transfer or paying businesses?

Interviwer: Both

Candidate: Will it cover only US or WW

Interviwer: WW

Advantages:

A) Address customer needs: Customers in many instances want to send money to their friends and families that they connect through facebook. Today customers have to download separate apps like for zoom for international money transfer and Venmo for domestic. Instead, we can save customers time by allowing them to send money within facebook messenger.

B) Increase the value of the facebook's ecosystem: Today customers have to pay a premium to send money over the peer to peer network. Instead, if facebook can offer instant money transer at no additional cost, facebook can save customers money.

C) Increase the customer engagement and retention: By serving additional use cases such as sending/receiving money among friends and families. Facebook can more reasons for customers to use the product, boosting the overall customer aquistion, engagement and retention.

D) Support small business: Facebook is the free service that is used by the billions of customers around the world. By offering the payment option within messenger, people in rural areas can start the small businesses in rural areas with having to invest in point of sale terminals. Facebook can lower the barrier for entry for business and can increase its pentration into the rural areas.

Disadvantages:

A) Navigate the regulatory and compliance requirements: There are several regulatory requirements that facebook need to navigate and keep up with it on an ongoing basis once it launches payment features

B) Fraud protection: Customers might fraudulently dispute the payments that are made for the product/services they received succesfully. Facebook need to invest in capabilites to avoid such bad actor activities, otherwise it will create negative experience for the small businesses.

C) Significant investments are required to build these payment capabilites: Payment tech involves building brand new technologies to communicate with government systems.

D) Privacy/safety concerns: Given the bad PR associated with Facebook recently, some customers might be apprehensive to link their payment details with thier facebook account. This will undermine the effectiveness of the product launch.

E) Competitors: Today, customers use peer to peer payment serivces like venmo, square with the account already set up, thereforefore it might be difficult to convert those users to facebook.

Given that the advantages outweigh the disadvantages, and payment service offer one more way through which facebook can connect the people, I would recommend to launch the payment service.

productmanager1644 · Answer 2 · 2021-02-11T03:06:25+0000

Feedback welcome on my strategy for answering this FB product strategy question.

CLARIFY:
1. Are we channel focused? You choose.
2. US v global? You choose.
3. Should we assume you mean both sending / receiving payments? Yes.
4. Are there a specific type of payment (B2B, B2C)? You choose.
5. Is there a goal? You choose.
BACKGROUND: Facebook is a social media platform that focuses on building a community / bringing the world together. Facebook Messenger allows users to direct messenger individuals or businesses. In mobile, it is a standalone app. Facebook has payment capabilities in marketplace but does not offer peer to peer payments or B2C payments in Messenger.
GOAL: Based on Facebook's vision, I believe the goal of adding payments would be to increase the stickiness of Messenger / get higher engagement on the platform. (Confirm with interviewer.)
STRATEGIC CHOICES: There are two choices: either to launch payments or not launch payments. For this strategy, I'd like to first focus on individual peer to peer payments
1. Launch payments in Messenger
2. Do not launch payments in Messengers
EVALUATE CRITERIA:
1. User Experience: What would the overall experience in Facebook Messenger be / how would payments enhance it
2. Engagement: Would payments increase engagement on the platform
3. Revenue: Would Facebook earn revenue
4. Technical Implementation: How difficult would it be to implement
5. Legal / Liabilities: Would Facebook increase its risk with payments implementation (ex. if payment fraud occurred, would Facebook be liable?)
6. Data Security: Payments requires very sensitive information (bank account). Would users feel comfortable providing Facebook payment information and how would Facebook handle sensitive information.
7. External Competitors: Existing competitors in the market that already work in Peer to Peer space.

EVALUATE CHOICES: I'd evaluate the launch option against the following criteria.

Criteria	Evaluation
User Experience	High: Users may have better experience in Messenger with expanded functionality.
Engagement	High: Additional functionality will create "stickiness" to Messenger.
Revenue	Medium: Facebook could potentially earn more money from payments transactions - i.e. take a portion of each payment sent or allow free transactions unless users do instant deposit or pay via credit card.
Technical Implementation	Medium: Facebook has payment capability already in Marketplace. Presumably certain aspects should be similar but the build may need to be tweaked to work for peer to peer.
Legal / Liabilites	Low / Risky: Potential for Facebook to face liability if payments are fraudulent / scams. Much bigger risk.
Data Security	Low / Risky: Payment data contains sensitive information (bank details). Facebook needs to ensure details are kept private. Additionally, users may not feel comfortable giving Facebook payment details.
External Competitors	Many: Many external competitors in the market (Venmo, PayPal, CashApp, Apple Cash, Google Pay, etc.).

RECOMMENDATION: Given that the goal is to increase the engagement of Messenger, I believe we should launch Payments in the app; however, there may be some technical difficulties though presumably not too difficult given the existing payments abilities in Facebook. A big watch out will be risk / liabilities / data security. Presumably, Facebook has also dealt with similar issues for payments on Marketplace, so there is likely work that exists that can be reused which makes the work easier.

Nitnan · Answer 3 · 2022-07-13T08:18:55+0000

Clarifying questions

Are we thinking about peer to peer payments or do we need to consider the payments made to business?

Does this need to be implemented globally?

Product and Goal:

People in todays world like to be connected privately and also like to form closer group with who they can constantly communicate. Messenger a product from facebook helps with people by facilitating messaging one to one and one to many over the internet thereby resolving the mission of facebook.

Payments on the other hand is making the life of people easy by buying and sending money to people without an hassle

Decision to be made:

Do we need to add PAYMENTS to Messenger or not?

I am going to come up with few positives and negatives of implementing payment in to messenger and analyse whether it would benefit or detoriate the messenger app

Positive of having Payments:

1. People within the close circle would require to send and recive moeny for which they use other apps like venmo or paypal. In the middle of a conversation they have to go out of messenger to send money and this creates a break in the conversation

Hypothesis: Increases engagement and community feel

2. Peopl these days on group discuss about going to tours or cinema where thry would like to share money and this might again increase the converastion without the worry to split money and manage in otehr apps

Hypothesis: Increases engagement and community feel

3. People visit a lot of shops who are within the community like a grocery shop of bike rental where the payments could be made instantly along with some feedback

Hypothesis: Increases engagement and community feel

4. After making payments to friends or other connection people might come back in a certain period to see the history of payments and keep a track on the spend and at that time there is a good chance that they start a covnersation

Hypothesis: Engagement and retension

Negatives:

1. Some people might be worried about the security aspect of payments being hendled within a messaging system

2. There might be a change that the goal of Messenger being predominatly a messaging solution changing its goal

3. Adopting to the usability of payments can be challenging sometimes

As a product manager I would not go ahead with a decision on my manual hypothesis I would set up an A/B testing to futher validate my hypothesis

User segment : I would want to pick power users of messenger

Some Metrics that I would track for this validation would be below

Average time spent in Messenger per user
Total number of messages sent\Recieved per user
Total number of people who added and set up the payments profile
Number of transaction per user
Total number of groups adoptiong to the transactions
Total number of payment requests inititated

NSM: Average time spent in Messenger per user

If the above metric increases then I would decide to go ahead with releasing the product to the global users

Internal Factors

Strengths: We already have the payments infrastructure built and we can use it with less engineering effor

Opportunity: Facebook users being the largers user groups

Threats: Competetion

Arnab Chowdhury · Answer 4 · 2020-08-24T22:06:17+0000

What is the feature?

Accepts payments from users in messenger.

Users of the feature

Facebook users
1. Can do payments among themselves. Friends can split bills, share expenses among family members etc.
2. Users can pay to online shops through the messenger and buy an item/service.
Marketers:
1. This could open the door to a whole new ecosystem.
2. Marketers can now allow users to avail services or pay for an item through the messenger itself.
3. They can resolve any queries about the product through the messenger and facilitate a buy.
4. All the steps from product discovery to conversion happens in the same application.

Goals for Facebook:

If FB decides to come up with this feature, then high-level goals for the company would be:

Increase engagement of users in messenger.
Increase the number of marketers in FB.
Increase revenue earned from marketers.

Hypothesis:

FB users are engaging with brands through messenger.
FB users are willing to make payment through messenger.
Marketers would be willing to sell through messenger.

Hypothesis 1: FB users are engaging with brands through messenger.

How do brands engage with users?
I would look at the following metrics to find out the engagement of the users with the brand. The metrics will be further grouped by age slabs, geography, gender, behavior on app etc.

Average number of unique users who chat with brands per day/week/month
Average number of unique users who chat/number of users who follow the brand (per day/week/month)
Average number of chat sessions with brands per day/week/month.
Average Number of follows on the brand pages
Average number of likes per post on brand pages
Average number of comments per post on brand pages
Average number of shares per post on brand pages

Hypothesis 2: FB users are willing to make payment through messenger.
For this, I need to figure out if the users are interested in buying. If they are, then they will click on the link to shop. The metrics will be further grouped by age slabs, geography, gender, behavior on app etc

Average number of unique users who click on shop per day/week/month
Average number of unique users who click on shop per day/week/month after chatting with the brand.
Average number of unique users who click on shop/users who follow per day/week/mont
User research through surveys
Conduct A/B testing on specific set of users

Hypothesis 3: Marketers would be willing to sell through messenger. Some brands may not want to sell through FB as the sale is happening on FB and not on their application.

Some brands who have already set up their own business might see this as a threat
New businesses might find this helpful as for them, setting up the online platform might be a hassle. These brands can set up a small shop in FB and start selling.
This will also depend on the ecommerce capabilities that FB can provide. Eg: cataloging products, setting up discounts etc.
To understand this, I will set up a survey and send it to all the brands to gauge if they are willing to sell through FB messenger.

Summary:

We discussed the feature, the users of the feature and the use cases of the feature and the goals of the feature for FB. We hypothesized the reasons on why users would use this feature and defined the metrics that can prove or disprove our hypothesis. Based on the data we can take an informed decision on whether to accept payments through FB messenger.

If we have good engagement of users with brands through messenger and if the users are willing to pay through messenger then we can go ahead with building this feature. Users can start peer to peer payments. We can then start with the brands setting up shops in FB and selling through messenger.