The problem with handcuffing a mobile wallet to an operating system (or hardware set) is it that it makes getting to scale among both consumers and merchants really, really hard.
“To even remotely stand a chance of winning the ‘war,’ a mobile ‘wallet’ can’t be captive to just one mobile operating system or device and the set of customers that that particular operating system has gotten on board its platform – and then the subset of those consumers who have decided to download and activate its ‘wallet,'” MPD CEO Karen Webster wrote in her commentary this week about the potential winners – and losers – of the now-all-of-a-sudden-fashionable- again “mobile wallet wars.”
And while the article itself made a very data-centric case about the modern consumer and her digital lifespread across a variety of devices, operating systems, and interfaces and the necessity of reaching them on as many of those contact points as possible – this week’s commentary brought along with it two big surprises. The first is that MPD CEO Karen Webster is apparently a Star Wars fan.
The second – arguably more relevant surprise – is that PayPal apparently agrees that the mobile wallet wars will ultimately be won by the provider who figures out how to bring the battle to as many fields as possible – and then win those battles while they’re there.
PayPal announced yesterday (April 28) on its blog the rollout of One Touch for Web. Similar to the mobile version of the product that PayPal introduced last year, that works in native mobile apps – One Touch for Web allows consumers to pay without user IDs or passwords (after the first log-in) on websites – be they mobile or desktop.
“We have seen such fantastic results in One Touch, that we realized we needed to figure out how we take it to the Web for both the mobile Web and desktop Web so people can have the same great experience of all those places that they are already having a great native mobile experience,” PayPal Senior Vice President Bill Ready (and former Braintree CEO) told Webster shortly before the news was announced yesterday. “Honestly, we think rolling out PayPal Web will be the biggest upgrade to eCommerce since PayPal launched 15 years ago.”
Ready acknowledged this to be a bold statement – but noted that One Touch has already seen dramatic results in the native only apps it’s already in – with some merchants reporting conversion rates upped as much as 50 percent.
“Those are best-in-category mobile buying experiences,” Ready noted. “Those numbers in the world of payments are unheard of. The merchants that implemented One Touch for native mobile are over the moon on this, because as you know, in the world of payments, conversion rates are very hard to move.”
Ready noted that the results in the Web version of One Touch may be less dramatic than on mobile – since the friction of entering in card and shipping information is a bigger pain point on mobile than on a traditional computer. That said, Ready noted, it’s still a two minute process that drives consumers away – and considering the vast majority of shoppers on mobile that are transacting through the mobile Web and not native apps – it is a pain point well worth fixing.
“It’s a huge upgrade to the buying experience,” Ready told Webster. “It’s cross platform – whether it’s iOS or Android or on your laptop or desktop – it’s the same experience.”
And though, perhaps even better – it’s an upgrade to the consumer who won’t require that merchants do anything to benefit from.
“For the majority of the PayPal experiences out there, this will be available without the merchant having to do anything,” Ready told Webster – noting that the narrow exception might be some very longtime legacy merchants that might require an additional step.
And while it does not require a major investment on the part of the merchant to take advantage of this, Ready does think that this step is an important part of helping retailers integrate the mobile device into the entirety of their business – as opposed to just the eCommerce end of things.
Webster asked – given how easy it will now become for a consumer to pay with One Touch on a mobile device, why can’t she just use this in a physical store and have it — her phone and her One Touch — become the POS? And while noting that this was an obvious oversimplification of what’s required to make that happen, Ready did note that it was a good question that a lot of smart people had been searching for an answer to for quite some time.
“An entire industry has wrestled with this for years; as you know, it’s something that’s clearly hard to do in the physical world,” Ready said.
He further noted that it was a question that PayPal, particularly through its acquisition of Braintree and, more recently, Paydiant, was formulating an answer for, and that the answer had to do with helping merchants build their own mobile experiences.
“You’re starting to see this upgrade of buying experiences,” Ready told Webster. “We believe that merchants have a big role to play in driving the kind of experiences that will create real engagement in their stores and we’re going to provide great infrastructure for that. One Touch knocks down one huge barrier for that. As much as it has been very difficult for the whole industry to address mobile in-store, we think that there is a huge step forward here in terms of us really being a key enabler for the merchant. We think great merchants apps are going to drive a lot of great experiences at the store beyond just tapping at the register.”
And though Ready acknowledges this is, and has been, a formidable challenge, it’s one that PayPal – an apps-based and device agnostic payments solution, is well suited to taking on.
“PayPal is very unique in the industry,” Ready said. “We have major scale on both the consumer and the merchant side of the network with deep integration on the merchant side and a real connection to the consumer that makes us pretty uniquely positioned to drive something like this at a rapid pace.”
The One Touch for Web experience is already rolling out for a select handful of PayPal users that Ready assured Webster was random. The plan is to continue to roll out the new platform to an extended user base over the next few months across the U.S.
One Touch for Web is also eventually destined to follow One Touch for mobile into cross-border sales, but for now it is available in the U.S. only.