In Depth

Did PayPal And Macy’s Just Deliver The Future Of Omnicommerce?

The theory of omnichannel is great. Consumers can shop how they want, when they want to buy what they want wherever they want to. It all sounds so liberating — and with smartphones in just about everyone’s hands, it seems so tantalizingly achievable.

Reality has not always borne out the sunnier parts of the theory, however, as those transitions between online, offline and mobile are often clunkier than they are convenient, and can involve a switch of payments systems midstream — especially given that many retailers have checkout processes that vary quite widely depending on whether the consumer is standing at a POS, tapping an app or navigating through a Web browser. Integration is a nightmare, and that’s on a good day.

“Omnichannel – is dead,” wrote Linkable Networks CMO John Caron just about a year ago. “There, I said it. Someone had to.”

The concept behind the buzzword is right, Caron noted, but the conceptualization of what omnichannel actually is is wrong. Omnichannel is not something a retailer “does” but is instead something they build.

[bctt tweet=”Omnichannel is not something a retailer “does” but is instead something they build.”]

“Over time. A long time. Trying to build an omnichannel experience for consumers is akin to trying to finish the roof at the same time you’re pouring the foundation of a home,” he wrote, noting that omnichannel done right is a painstaking and detail-oriented process.

“In other words, like building a house, building a seamless consumer experience requires a solid foundation, framing and exquisite finishing. All of which occur over time.”

PayPal and Macy’s have each put their time into the omnichannel “house” project – albeit working different parts of the job site.

Their common cause, however, is delivering a seamless and frictionless consumer experience across all shopping channels – and using technology to enable it.

And, as we saw and heard yesterday, that project is complete.

In something that is the first of its kind, PayPal customers shopping at Macy’s or any one of its brands will be able to use PayPal pretty much how they use it today online, standing in the store.

“We are powering Macy’s app for online mobile transactions but also for an in-store experience, and we are also mirroring those functionalities on PayPal app,” PayPal’s Vice President of Large Enterprise Retail Sales and Partnerships Robert Clarkson told MPD CEO Karen Webster in a conversation pre-launch.

Going forward, any consumer who wants to use their PayPal or Macy’s app using the PayPal payment method, can enable that transaction the very same way across all of those channels.

The in-store experience is made possible by PayPal’s Payment Code technology – which allows customers to “check in” to Macy’s store locations via geolocation technology. Once items are selected and scanned at the POS, with a tap of the screen the consumer gets an authorization code or a QR code to scan. From there, the consumer either gives the code to the clerk or scans the QR code – and the transaction is done.

Easy peasy.

“By the end of the month we will be at 100 percent of the experience at Macy’s retail properties and locations. It’s obviously very exciting for us because Macy’s is an enormously influential and high-end retailer that appeals greatly to our consumers,” Clarkson noted. “But they also share our vision in using technology to make the consumer experience easier and better.”

The key to bringing that shared vision together, Clarkson noted, was PayPal’s commitment to partnering with Macy’s in laying the omnichannel tracks that matched their vision – and didn’t confuse the consumer at the same time. This, Clarkson said, was only possible because of the flexibility of PayPal’s technology platform.

“There isn’t a lot of behind-the-scenes functionality that isn’t apparent to me as a consumer, and we think there is a lot of comfort in that,” Clarkson said. “Consumers don’t wonder if they paid twice or scanned things twice — there is a comfort factor there in just how easy and transparent the payments process is.”

The ability to provide the customer with that level of certainty and comfort is a big part of Macy’s vision, Macy’s spokesman Orlando Veras noted. But beyond being secure, he noted, the platform that Macy’s and PayPal are enabling for the consumer brings something perhaps just as important to the omnichannel equation: familiarity and sameness.

“This isn’t just about another payment method, but about a way to make omnichannel really streamlined and a singular experience,” Veras noted. “We know customers love to shop — in our stores, online and via mobile — and increasingly they are blurring the lines. They start looking online and then go to the store and touch and feel and buy there. Or they see it in store and decide to buy online, or buy it in the app. So what we want to be able to do with this partnership is offer the opportunity to pay with PayPal no matter how they decide to finish off the transaction with us, no matter where they decide to finish off the transaction the very same way.”

But, because of the customization, Veras noted, Macy’s also preserves parts of their in-store interaction with their customers that they believe is vital – albeit in an upgraded form.

“The interaction with us is still there, they still need to go to a register and have it scanned and such, and have the chance to engage with our sales associate,” he said. “But we are increasing the efficiency and the security of the mobile payment, because they aren’t exchanging credit card information with us.”

The last piece of the puzzle for the Macy’s/PayPal joint assault on omnichannel is Macy’s integration with PayPal’s One Touch network, which allows one-click shopping on desktop and mobile Web — joining more than 50 percent of other Internet Retailer Top 500 firms like Eats24 and Overstock.com, who have enabled this simplified checkout capability.

“We are significantly reducing the number of clicks and steps that the consumer has to go to between want and have,” Clarkson noted.

But more than just reducing the taps, Macy’s and PayPal have truly pulled off something that’s been pretty elusive for all of the years that omnichannel has been a buzzword — a shopping experience that is the same, even across very distinctly different environments.

“This mimics PayPal’s and Macy’s passion to have a continuum of the buying process be really seamless and making it easy for the consumer at any point — in store, out of store, on the way to store or even sitting on the couch to complete the purchase,” Clarkson explained.

[bctt tweet=”PayPal’s and Macy’s passion is to have a buying process be really seamless for the consumer at any point”]

It’s a tall order, but one that both has every reason to believe is attainable.

“Half of U.S. consumers said they would do more mobile if it were easier – and clearly our job is to facilitate the easy,” Clarkson noted. “Macy’s job is to make sure they have the inventory and experience that is right for their consumers. If we can capture that momentum and that pent-up demand, that’s powerful for both of us.”

And maybe even the blueprint retailers have been waiting for to build a powerful and secure omnichannel experience.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out the February 2019 PYMNTS Financial Invisibles Report

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