PayPal expects $500M in mobile payments volume by year-end
PayPal, an eBay company, has rolled out a mobile version of its Express Checkout service that lets merchants offer the same PayPal experience for their on-the-go customers.
Mobile Express Checkout is being launched initially on the iPhone and Android 2.0 and higher devices by several retailers, including Nike and Buy.com, over the next few weeks. Mobile Express Checkout will be available for the rest of PayPal’s merchants later this summer.
Mobile Commerce Daily’s Dan Butcher interviewed Bill Zielke, senior director of merchant services at PayPal, San Jose, CA. Here is what he had to say:
What is PayPal’s strategy behind the launch of Mobile Express Checkout?
We wanted to give our merchants a mobile version of PayPal’s proven Express Checkout technology, which gives merchants an easy way to engage with consumers and enable transactions via the mobile channel.
In a PayPal survey, 100 merchants reported that the seamless online checkout experience of Express Checkout boosted sales an average 14 percent.
Mobile Express Checkout allows merchants to offer the same safe, convenient PayPal experience to their on-the-go customers, including a one-stop payment service that does not require a complex back-end infrastructure.
It offers quick deployment to get merchants in the mobile game fast. It works with existing systems and offers easy integration with Express Checkout.
The customer experience is easy—especially important with tiny screens and keyboards. No cumbersome data entry: just a few clicks and you are done.
The platform provides access to the millions of PayPal’s payment enabled consumers with unspent dollars—PayPal accounts contain well over $2 billion in stored value that is spent every two weeks.
Mobile Express Checkout helps detect fraud and other payment-related issues.
The product is currently in a pilot phase with a few innovative merchants such as Buy.com and Nike. It will be generally available later this summer.
What trends are you seeing in the mobile commerce/payments ecosystem?
Mobile commerce is growing at a remarkable rate and PayPal has seen this in the mobile transactions going through our system.
As an example, our mobile transactions increased nearly six-fold-from $25 million in 2008 to $141 million in 2009.
We expect to close out 2010 with more than half a billion dollars in mobile payment volume.
There is a huge opportunity—almost obligation—for merchants to get onboard and start offering a mobile checkout solution to their customers especially as they prepare for the holiday shopping season.
How are consumers’ attitudes towards mobile payments changing?
The proliferation of smartphones has really changed the way consumers look at online shopping.
In fact, Gartner reported that smartphone sales surpassed 172.4 million units in 2009.
At PayPal, we expect to close out 2010 with over $500 million in mobile payment volume and more than 5 million members regularly using PayPal from mobile devices.
Consumers are clearly starting to adopt mcommerce in droves and mobile is no longer seen a fringe channel—it is mainstream.
What is the current state of mobile payments, and what is the potential for the rest of the year and beyond?
The potential for mcommerce is almost off the charts.
A recent report from ABI Research predicted that by 2015, consumers are expected to spend $119 billion through their mobile phones, accounting for nearly 8 percent of all ecommerce.
Shoppers expect to be met on their phones with opportunities to shop and make purchases, a key reason we’re rolling out Mobile Express Checkout.
We think that the merchant community is ready to embrace this technology in a major way and we’re excited to see mobile commerce’s growth both in the short term and further down the road.
Here is a video on PayPal Mobile:
Here is a video on PayPal Express Checkout:
Here is a video featuring Access Communications:
Dan Butcher, staff reporter of Mobile Marketing, New York.