Multi-channel: PayPal’s Implantation in Physical Retail Stores
- PayPal is now testing PayPal Wallet payments in stores with Home Depot (DIY specialist): this campaign is for now limited to five points of sales –dedicated PayPal teams are also available in the stores to advice customers.
- To pay for their purchases, they can provide their phone number and PayPal code, or –very soon– they should also be able to use a PayPal card. The amounts spent are then debited from their PayPal account.
- If successful, this test may result in deployments at all Home Depot stores.
- However it may be difficult to assume which technology will be selected next, other tests should be launched in 2012 worldwide (including in France –and in all Europe– starting Q1 2012). PayPal is again reasserting its technology- and media-free strategy: the only constant being its fierce will to enter the physical acceptance market. These plans had already been displayed in August 2011, when the player expressed its plan to extend its acceptance network to 20 major retail stores by end 2012 and further confirmed by its announcing a private label card (see August and October 2011 Insights).
- Preliminary mobile payment pilot tests have been conducted in Sweden; these tests however do not rely on the same technology but on a contact and contactless payment solution, based on NFC stickers and PayPal InStore app (see December 2011 Insight).
- Recently, PayPal has also partnered with PSP AJB Software Design to provide for its POS development. In addition to the interface –currently under development– which should allow customers to pay through entering their mobile phone number and PayPal-dedicated PIN code, this partnership should help designing an adapted card acceptance device (the tool would also take loyalty issues into account).
- To provide for this expansion strategy, eBay can count on PayPal and BillMeLater (already integrated in its mobile payment system) as well as on over 100 million users (those having made at least one transaction over the past 12 months).
- Also, this announcement does remind one of Google’s positioning, for example, which is increasingly thriving towards mobile payment, through Google Wallet mostly. All these initiatives may be threatening banks and many are now rallying around “home-made” mobile payment solutions or joining in existing offers.