PayPal Makes the Jump Into Brick-and-Mortar Retail Stores
February 13, 2012 3:24 PM
comment(s) - last by
Don Kingsborough of PayPal
While PayPal is king of e-commerce payments, this area only accounts for less than 10 percent of U.S. retail sales, and PayPal wants more
is working vigorously to break into the brick-and-mortar retail store realm by offering more data transparency and competitive prices.
Don Kingsborough, Vice President and General Manager of Retail and Prepaid at PayPal, is at the helm of the latest effort. While PayPal is king of e-commerce payments, this area only accounts for less than 10 percent of U.S. retail sales. That's why Kingsborough is aggressively moving PayPal to physical stores and hopes to push it up in the ranks with the likes of Visa and MasterCard.
The plan is to reach a public goal of 20 major retailers using the point-of-sale (POS) system by the end of 2012. The system works when a customer checks out, and the POS card-swiping terminal offers a new orange button saying, "Pay with PayPal." Customers can select this option, confirm the total, then type in their cell phone number and a PIN number that was determined before going into the store.
"We are going to do it with the greatest brands in the world -- Home Depot and every other top 100 retailer," said Kingsborough. "There isn't a major brand we haven't talked to."
PayPal, which is owned by eBay Inc., already has Home Depot testing the POS system and Office Depot is next on the list. PayPal refused to disclose the names of any other retailers onboard.
There's no doubt Kingsborough likely has more retailers in his back pocket, though. In less than a year's time, Kingsborough traveled 94,000 miles total on United Airlines in order to meet with major retailers. Many of the contacts came from Kingsborough's Blackhawk Network, which he founded in 2001. Blackhawk Network is the largest provider of prepaid gift cards for companies like Home Depot and Starbucks.
Kingsborough seems to be the right guy for the job since he has already worked to get large retailers on board with Blackhawk Network.
PayPal plans to compete by subsidizing the new service, which means merchants could pay less with PayPal than they currently do with other credit and debit payment processors. PayPal stands to win because 45 percent of PayPal transactions are funded through user's bank accounts or an existing PayPal balance.
In addition to aggressive pricing, PayPal will also
share more data
with retailers, such as purchases and shopping activity. This extra information will allow retailers to read their customers better and provide appropriate offers to them, which encourages more shopping.
It won't be entirely easy for PayPal to branch out of e-commerce, though. At this point, PayPal isn't relevant off of the Internet, and it will have to work to entice customers to use the service instead of just sliding their credit or debit cards.
This article is over a month old, voting and posting comments is disabled
How much have they thought about this?
2/14/2012 7:48:07 PM
So, instead of using my debit card I can use a PayPal account linked to my checking account? How is that any better?
And instead of using a credit card, I can use the PayPal account linked to a credit card. Exactly what kind of consumer protection does that provide? Credit cards are actually *very* good at this and I'll much more readily use a credit card than debit card or cash when purchasing expensive items.
And the retailer I assume will get charged a fee by Visa/MC when PayPal is linked to a credit card. And they pay a fee to PayPal. Which basically just means anywhere PayPal can be used will have all sales go up in price. Thanks guys, that's really nice. Now, please, stay out of the real world.
RE: How much have they thought about this?
2/15/2012 12:18:58 PM
yep. not sure how adding an additional layer, and additional expense, is going to be useful to the consumer enough to make it worthwhile to paypal.
but having additional choices is welcomed.
RE: How much have they thought about this?
2/16/2012 4:20:38 PM
I agree.... add to that the fact that Paypal has a pretty bad rep. It seems like a better deal for the retailer because they get the shopping habit details, but not for the consumer.
I don't think (?) that the credit card companies share consumer shopping habits with retailers?
Either way, I use Paypal only when I have to and I won't increase that.
"Nowadays you can buy a CPU cheaper than the CPU fan." -- Unnamed AMD executive
AT&T Readying Systems for Shared Data Plans
February 13, 2012, 10:28 AM
PayPal Sues Google for Misappropriated Trade Secrets/Contract Violations
May 27, 2011, 11:41 AM
Netflix Announces 7-to-1 Stock Split, Eyes Explosive Overseas Growth
June 23, 2015, 8:18 PM
Sources: Hack on Fed. Database Lost 4.1M Social Security Numbers, Personal Info
June 11, 2015, 9:11 PM
The Big One: Chinese Hackers Steal Records of 4 Million U.S. Gov. Employees
June 4, 2015, 8:13 PM
Tutorial: Here's How to Force YouTube or Vimeo VIdeos to Embed as HTML5
June 3, 2015, 10:14 PM
Google Finally Fixes Maps Bug That Was Giving Racist, Profane Results
May 21, 2015, 1:43 PM
The Pirate Bay Loses Its Iconic Swedish Dot SE Domains
May 20, 2015, 6:31 PM
Most Popular Articles
Windows XP, Vista Users Can Get Free Windows 10 Upgrade Thanks to Loophole
June 23, 2015, 2:23 PM
SanDisk's 200GB microSDXC Card Turns Smartphones Into Enviable PMPs
June 26, 2015, 2:02 PM
U.S. Navy Spends $9M USD to Cling to Windows XP, Office 2003
June 24, 2015, 2:03 PM
Under the Hood: Digging Into Sony's New CUH-1200 PS4, 1 TB Ultimate Player Ed.
June 23, 2015, 10:33 AM
Xbox Outsold 108-to-1 By PS4 in Japan, Weekly Sales Fall to 100 Units
June 22, 2015, 1:54 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2015 DailyTech LLC. -
Terms, Conditions & Privacy Information