Square's Marketing Spend Is Too Efficient
Square (NYSE: SQ) has seen the payback period on its marketing spend decline considerably over the last few years. Management used to say it recoups its investment in marketing within five quarters of signing up a new seller account. More recently, that number's fallen to between three and four quarters.
That might sound great to a lot of investors. More efficient marketing means more profits.
But the financial services and mobile payments company sees a massive long-term opportunity to capture more of the $3 trillion in credit and debit card gross payment volume processed by small and medium-sized businesses in the United States. It accounted for less than $100 billion in payment volume over the last four quarters.
Source Fool.com
