Amazon’s Venmo integration is a sign of the times

Come Black Friday, Amazon’s legions of loyal shoppers will be able to pay for their holiday gifting purchases via Venmo. And experts say the addition of this latest payment method may attract younger consumers to the ranks of two-day shipping disciples.

The October 25 announcement is an indicator of the retail industry’s payments trajectory, Elissa Quinby, senior director of retail marketing at digital analytics firm Quantum Metric, told Retail Brew.

“Consumers are definitely dictating how they’re utilizing their money, and [Venmo] is the first piece,” she said. And now that Venmo will be an option on Amazon’s platform and app, Quinby, a former product manager at Amazon, said consumers will soon expect it from other retailers.

• Venmo owner PayPal reports that commerce payments via Venmo grew by more than 250% in Q2 of 2022.
• The company’s 2020 Behavior Study found Venmo users skew younger and more affluent than the general US population.

Broader reach: Eddy Ouwendijk, managing partner at consulting firm Payments Advisory Group, said the demographics of Venmo users may help Amazon tap into the “social spending” trend among younger shoppers.

Ouwendijk pointed to Venmo’s 2020 survey results indicating an increase in digital spending. “Of course, we must consider that this was also stimulated by the pandemic,” he told Retail Brew via email. “Nevertheless, this is a trend we also see in Asia,”  he added, nodding to WeChat pay.

Quinby said brands who want to get ahead of the Venmo payments trend need to think carefully about how to build awareness around their payment options.

• “Utilizing merchandising and more advertising to make sure consumers are aware of what their different payment options may be, and if those meet their needs, is going to be an important piece that retailers are going to need to consider,” Quinby said.
• And according to Quinby, Venmo isn’t the only payment option retailers should be considering if they want to keep up with consumers.
• “Brands need to listen to how consumers are using their own money, whether that’s in Venmo or their digital wallets, or they want to pay with their crypto accounts,” she said.—MA