For eCommerce platforms — with Amazon and PayPal among the most visible examples — checkout is evolving as part of the glue that holds ecosystems together.
For these two firms, the opportunity lies in easing friction as consumers check out, but also in realizing new revenue streams as checkout/processing services boost additional revenue streams gleaned from the merchants serving those consumers.
During the conference call with analysts to discuss earnings, PayPal’s new CEO Alex Chriss said the company’s “end-to-end consumer experience with checkout at the center that will bring value to consumers with every single purchase.”
The comments come in the wake of the May conference call with analysts, where then CEO Dan Schulman said TPV (total payment volume) from PayPal’s branded checkout “meaningfully accelerated” to 6.5% growth, while unbranded TPV was up 30% on an FX-neutral basis.
And during the most recent earnings call with analysts, discussing third-quarter results, Acting Chief Financial Officer Gabrielle Rabinovitch noted that “we’re seeing very healthy trends in our checkout business. We’re heading into the heart of Q4, and we really see no meaningful shifts in our performance or our demand environment.”
In the most recent period, global branded TPV volume checkout growth was 6%. That rate was 5% in the second quarter.
Those growth rates were eclipsed by the double digit rates for its unbranded processing business, where company materials show that volumes accelerated sequentially, growing about 32% on an FX-neutral basis, compared to 28% growth in the second quarter and 30% in the first quarter of this year.
Separately, Chriss said on the call that PayPal Complete Payments, which helps smaller firms accept a range of payment options and customize the checkout experience, “means we can auto fill payment information for consumers and streamline guest checkout for our merchants.”
Amazon, for its part, has recently expanded the reach of Buy with Prime. As reported here, the expansion lets merchants integrate the function directly into their websites (off platform) and shopper conversion rates for those merchants have increased by as much as 25%. The company also announced the capacity for sellers to integrate Buy with Prime into their Shopify accounts.
And as reported just this week, in a nod to its straddling of both online and physical commerce, Amazon is continuing to add traditional self-checkout kiosks to its Just Walk Out stores. The “Just Walk Out ” option, aided by FFID and palm recognition, is being scaled out to apparel and food/beverage stores.
Shopify earlier this year made its Shop Pay checkout available to enterprise retailers as a standalone component, through which shoppers with Shopify accounts in place have their details pre-filled when visiting a retailer’s site. And company presentation materials from the most recent conference call noted that 100 million buyers opted into Shop Pay. The company’s Shopify Checkout has also been redesigned to a one-page streamlined presentation.
PYMNTS Intelligence, in collaboration with Splitit, found earlier this year that 73% of consumers have stated they will move their business elsewhere when a brand does not deliver the checkout experience they expect. And 67% say that a satisfying checkout experience is “very or extremely” influential as a factor governing whether they will shop at a merchant again.