Square is re-examining its market strategy

Absrtact: U.S. mobile payment service provider Square may need to re-examine its marketing strategy by acquiring an external company to expand the size of its business after the US network payment giant PayPal has bought a start-up, Braintree, and

After America's network-paying giant, PayPal, bought a start-up, Braintree, the US mobile payment service provider, Square, may have to re-examine its marketing strategy by acquiring an external company to expand its business, while taking a more open approach, This provides payment and small business Analysis Services to all types of companies.

Although PayPal has been Braintree for its own, but previously interested in Braintree technology companies are not just a paypal. Braintree, headquartered in Chicago, USA, is attractive to application developers. There are rumors that, in addition to PayPal, Square has also been interested in acquiring Braintree. If this rumor is true, it means that square is re-examining its market strategy to play an important role in the payment market.

Three people at the same table

The American Science and Technology information website ReadWrite recently learned that Braintree chief executive Bill Reddy (Bill Ready), Square chief Executive Dorsey (Jack Dorsey) and square Chief Financial Officer (CFO) Sarah Flia ( Sarah friar) had held talks. When ReadWrite to prove it to him, he did not deny it.

"I know doxycycline and Flia and I respect both of them and square," ReadWrite said recently. As with other industry people, we have talked before. "It's just that we don't know what they're talking about in this meeting," he said. Of course, there are a lot of topics to discuss between them. (ReadWrite to square to verify the authenticity of the talks, a spokesman declined to comment. )

First we should understand the main business of Square and Braintree: Although two companies are engaged in payment-related services, their products and customers have little overlap. Square offers a physical credit card reader for smartphones and tablets, as well as a cash register for Apple's ipad tablet users, named "Square Stand". In addition to these hardware products, square offers fixed payment services.

From a consumer's point of view, when they use square swipe cards, they are not much different from their own habits: take a swipe of a credit card. If there is a change, it is that square can send a receipt to a swipe user via email or SMS without having to use the traditional print style. Businesses (usually small shops), service providers and small chains with no more than 10 location have access to more streamlined checkout services at square. Although Square has recently been killed by the introduction of the "square market" into the field of E-commerce, but overall, Square's main business is still targeted at real-life physical stores sales and payment.

In contrast to square, Braintree acts as a back-end payer, whose brand has little knowledge of consumers. When the company was created, it served primarily as an alternative to PayPal and other network payment services. For some time now, Braintree has found a new business path that is more lucrative: providing credit card processing services to mobile application developers.

During the last year, Braintree acquired a personal payment application developer can. In this way, Braintree has its own brand for consumers. Before PayPal announced the acquisition of Braintree, Braintree was working to make can a mobile wallet service. The service allows users to enter their own credit card accounts once they have logged in to Braintree an application, and then the user will no longer have to enter their credit card account in the process of using Braintree other clients.

Facilitate

To say that square and Braintree business overlap, that is, various services. These credit card accounts and related information will be stored in a server, whether by issuing a password to the smartphone to buy coffee, or by using the Uber call software to pay quickly after the payment is completed.

"We want to be able to handle every move payment transaction," doxycycline of Square said in a recent interview with the San Francisco Chronicle. "It is clear that if the square business is still in the" Small Business "entity environment, it is difficult to achieve this ideal of the West. In other words, square must also seize business opportunities in the virtual world.

Open Policy

There are signs that square is thinking about how to make the market bigger. One sign is Doxycycline's meeting with the Reddy. Of course, if Square really buys Braintree, it will cost square a lot of human resources and will challenge the service identity of square. Another sign is that Square recently hired Gocourt Rajaram (Gokul Rajaram) to be responsible for technology development. Rajaram, a software platform specialist, worked for Google (Weibo) and Facebook.

In the technology industry, the term "platform" is not strictly defined. A lot of tech companies are claiming to be running platforms, but few are really owning their own platforms. The real platform should be a system that provides exchange value on the basis of technology interdependence. Platform operators provide the foundation and support for other software developers to enable them to create applications with practical value. These applications, in turn, create the value of the platform.

Now square seems to operate completely independently. The company has a complete system of integrated hardware, software and services. The advantage of this system is that once square finds new business opportunities, it can quickly and forcefully attack and improve its product performance. But the interaction between square and other software developers is weak, which means that square is "alone".

Square has already begun to "untie" its business control. Square last year made a high-profile announcement that it had reached a partnership with Starbucks. Today, however, the actual implementation of this cooperation is discouraging: Starbucks corresponding personnel training work is not done well, the corresponding bar code also let consumers confused. A few days ago, Square announced that users would be able to export data from the square proprietary software register to Intuit's QuickBooks.

These initiatives are just Square's experimental projects to test whether Square can work well with other service providers. But in any case, square must eventually embark on an open path.

Out

Star companies such as Square will certainly not be able to pin the growth of their business to rivals such as PayPal, which have taken the lead in the rise of smartphones and mobile payments as they have missed out on business opportunities. Although the amount of money paid by Square is now more than 15 billion dollars per year, it is less than one-tenth of PayPal's size.

And the square has the possibility to open the road the product, is its "pays together with the name" function, currently the product name is "Auto Check in" (Automatic check-in). The product can be a basic service for other application developers, and application developers can benefit from Square's brand advantage. The consumer's reliance on square is not the same as treating Braintree and can (just as a means of payment). Square, which is more closely related to consumers, will send a signal to smartphones that you don't have to repeat your credit card account with us.

Perhaps Square will never provide a fully open API (Application programming Interface), after all, it is responsible for handling the public funds and business data. But perhaps square can provide multiple access layers, or a system of invitations, to allow developers who follow the square rules and build websites for stores to participate.

How to make it good for these developers (which square has been ignoring this before) will undoubtedly require some skill. Perhaps square should consider buying a company to do that. Its takeover target can be considered by San Francisco's payment services start-up firm Stripe. The company has a lot in common with square: the product design concept is improving and has gained the support of some well-known investors.

Patrick Collison, chief executive of Stripe, has been insisting on good customer service, and his spirit is also compatible with square's corporate culture. If Collison joined, plus the new Gao Tara Jalam, this combination would be enough to worry PayPal chief Executive David Marcus David Marcus and Braintree chief executive.

Should square add content to its current business and add services for application developers to hardware, software, and payments? Without these services, square seems to be walking on one leg.