How has Bizum managed to outperform its competitors and build a differentiation strategy.
"Don’t worry, I’ll pay. Just send me a Bizum”. Expressions like this one are becoming more and more usual in our daily life. Bizum, a Spanish payment service provider (PSP), was born in 2016, and at the end of 2020, it reached the amount of 13.6 million frequent users. The total quantity moved through Bizum during 2020 was nothing less than 10,200 million euros.
Bizum can afford to cover a wide targeting, users just need a mobile phone and a bank account.
Numbers show that more than 50% of Bizum users are aged from 25 to 44 and, what’s more, the group of consumers older than 45 is growing at a significant rate.
It is interesting that Bizum was not the first company to provide such service; we could think for instance of Verse, GooglePay, AmazonPay or some others. However, Bizum has excelled in the Spanish market way more than its competitors: the functioning of Bizum has been created, supported, and ratified by the banks themselves, which act as a very important safety backup to users. Therefore, people who want to send a Bizum do so through the very same app of the bank instead of an external one. From customers' perception, when they send a Bizum, they feel like their money never leaves the bank, in a sense. This does not happen with Verse or many other companies.
Such phenomenon implies that the value of a service increases with the number of users, which allows companies who benefit from it to grow through the customers.
As Fernando Rodríguez Ferrer, business development director at Bizum claimed, their most powerful marketing tool is the users themselves, meaning that the more users join the PSP, the more valuable it becomes.
Cooperation between banks and Bizum seems key in the success of the Spanish company, which appears to have taken a solid spot in the industry and a clear positioning in consumers’ perception.
The future of Bizum looks bright as well, as new horizons that it is starting to scratch arise, such as linking to e-commerce, while the future of physical money trembles a bit more every day.
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