In the past several years, RSR (along with virtually every other industry focused research, B2B media, technology provider, or consulting company) has been observing and measuring retailers’ attitudes about the explosion of consumer-focused technologies, and attempting to gauge how those technologies will ultimately affect retail operations. There are a lot of givens at this point, for one that consumers do and will continue to use smart mobile technologies to make informed purchase decisions – before and during their trips to the store. Easy access to information is fundamentally changing how retailers must interact with shoppers. Another given is that consumers like to communicate with each other via social media about their shopping experiences.

Beyond providing relevant content to help shoppers make more informed purchase decisions, the future is not nearly so clear. For one, retailers who tried to tie in social media with selling (a seemingly obvious connection between people wanting to talk about what they purchase and why, to making that purchase easy) got their hands slapped pretty quickly by consumers. As far back as May, 2011, we saw in our benchmark on Social Media in Retail that, “Winners understand that consumers want to connect with each other and see an opportunity to facilitate that dialogue through the Brand. ” Putting it more bluntly, customers want to talk about you, not to you. So, what’s the value to retailers? The value is that retailers can get important non-transactional (or pre-transactional) signals from engaged consumers about what is working and what is not. And through a thoughtful dialogue with social media advocates and detractors alike, retailers can build the Brand up. My favorite example of this is in how REI uses its Facebook presence to build Brand value.

Similarly, we found out in our December 2012 benchmark on the State of Mobile Payments in Retail, that retailers aren’t all that unhappy about card-present debit and credit transactions (its checks that retailers- particularly U.S. retailers- want to get rid of). But the mention of mobile payments (or “digital wallets “, as some pundits call it) causes a lot of them concern – because it implies a certain amount of loss of control as well as the potential for new security and fraud risks, which they are not too keen on having to address so soon after years of big spending on PCI compliance. Then too, there’s the fact that just about everywhere in the world except in the U.S., retailers have invested in making their in-store point of sale systems EMV-capable, and the U.S. is expected to follow suit within the next 2-3 years, owing mostly to a push from VISA (V) to do so. After years of fretting and spending about electronic payments, retailers just want to move on to something different. “Why change yet again “, they ask?

If retailers aren’t sold on mobile payments to replace the venerable “mag-swipe ” card or its more modern EMV equivalent, it doesn’t appear that consumers are in any big hurry either. According to a piece in Bloomberg BusinessWeek in the June 6, 2013 edition, “Google Wallet (GOOG), the mobile software that allows Android users to pay for purchases online and in stores with their phones, has become a money pit. The company has dedicated hundreds of developers to Wallet and spent about $300 million to acquire digital payment startups to help develop the app. But consumers aren’t sold ” (my emphasis).

All that aside, investors and inventors in “Silicon Valley ” are forging ahead, and investments in mobile payment technologies are hot. One year ago this month, The NY Times expressed it this way (in discussing the success of then-darling technology Square, Inc.):

“Square’s success shows that venture capital has the potential to turn the ordinary into multibillion-dollar businesses. This is nothing new, but it may reflect the future as the best venture capital firms move further afield from the Internet, the old V.C. stamping ground. The future of venture capital and Silicon Valley may be more like Edison’s laboratory, looking for the innovation in ordinary tasks and doing so based on leveraging pre-existing ideas and products. This is a world where the haves are likely to continue their extraordinary run, armed with the tools to succeed. Innovation will come from the princelings of the Silicon Valley hierarchy, as successful entrepreneurs will already have the resources to make these breakthroughs. “

Enter Facebook

All of this is a prelude to some news that came out last week, that mega-successful Silicon Valley startup Facebook (FB) is getting into mobile payments. Interestingly, they have apparently decided not to process the payments themselves, but to enable consumers who have used credit cards, Paypal, or similar payment methods, with Facebook Gifts or games on Facebook to make an online or mobile purchase using a 3^rd party app by clicking on a “Facebook ” button. How so? Well, Facebook stores consumers’ credit card or other payment info. But the company was quick to dispel any rumors or fears that they are using their wealth to buy into the payment processing business. According to a company statement:

“We are working on a very small test that gives people the option to use their payment information already stored on Facebook to populate the payment form when they make a purchase in a mobile app. The app then processes and completes the payment. The test is designed to make it easier and faster for people to make a purchase in a mobile app by simply pre-populating your payment information. It will be a very small test with 1-2 partners. Additionally, this test does not involve moving the payment processing away from an app’s current payments provider, such as Paypal. We continue to have a great relationship with our payment processing partners, and this product is simply to test how we can help apps provide a simpler commerce experience. “

Small though the test may be, this bears close watching by omni-channel retailers, because it potentially puts Facebook right into the middle of the dialogue between buyers and sellers in the digital realm, which in turn could become less “passive ” in future times. Facebook continues to be one of the most widely used technologies available to consumers today (according to the company, monthly and daily active user numbers topped 1.11 billion and 665 million respectively, in May). And in its July 25^th earnings release, Facebook said that In Q2, it sold approximately $656 million in mobile ads, up from $375 million in Q1, and that mobile advertising revenue now makes up 41% of Facebook’s ad revenue.

Having a hook into consumers’ mobile payment behaviors will give Facebook a valuable information asset to correlate to advertisers’ mobile ads. And by virtue of its massive consumer following, Facebook could finally push consumers over the ledge towards adoption of digital wallets, and retailers will have to respond just to keep up.