Coauthored by Ben Carsley, Managing Editor (@BC_PYMNTS)
Welcome to What’s Trending In Payments – a weekly look at the most popular, irreverent and important stories the payments industry had to offer over the past five days. Which companies grabbed the most headlines – for better or for worse – this week, and which topics have the industry abuzz with intrigue, laughter or disbelief? Featuring breakdowns from the PYMNTS.com staff and commentary by Karen Webster, here’s our take on what all of you payments peeps thought.
TOPIC ONE: PayPal Moves Into Cash With MoneyGram Deal
Why It’s Hot
PayPal and MoneyGram stole many a headline this week thanks to the news they announced on Monday that U.S. PayPal account holders can now withdraw cash from their accounts at MoneyGram locations.
MoneyGram called the service “the first phase” of a larger rollout, and said that by the end of 2013, consumers will be able to add money to their PayPal accounts at MoneyGram locations as well.
It’s a unique proposition to be sure, and impacts how we look at banking, prepaid, underbanked services and more.
And who said cash is dead??!! I’ll be writing more about this next week but I think this is an amazing development. We’ve known for a while that the combo of digital + payments is a game changer, but this announcement I think foreshadows the future of banking. This isn’t just about changing prepaid or giving the underserved a new tool, it is about giving people an account that is capable of “transacting” using cards, a checking account and now cash. It is a pretty big deal for that reason, but for two others as well that you’ll just have to wait and read about next week!
This is certainly a fair assessment from Schutte, whose voice we’ve had on PYMNTS before. But PayNearMe tweeted back, stating “we haven’t seen PayPal as a competitor,” and noting that consumers could already add cash to their PayPal accounts via MoneyPak. This is just one small example of how it’s going to be interesting to watch those in the industry react (or shy away from) the PayPal and MoneyGram news.
TOPIC TWO: Groupon Impresses With Q2 Results, New CEO
Why It’s Hot
Groupon released its Q2 2013 results on Wednesday and appointed Eric Lefkofsky as its CEO. Lefkofsky had split CEO duties with Ted Leonsis, chairman at Groupon, since Andrew Mason’s departure in February.
Lefkofsky’s tenure started on a high note, with Groupon reporting a 7 percent jump in revenue, to $608.7 million, and “their strongest quarter ever in North America,” in the new CEO’s words. Groupon also revealed that nearly 50 percent of it’s North American transactions are mobile – an interesting tidbit.
The new leader, strong quarter combo led Groupon to rise to $10.90 before Thursday’s open – a $2.18 and 27 percent boost.
Well, you know how you always want your elected officials to be sufficiently wealthy and supremely confident when they enter office as a result of having accomplished other things in life so that they really don’t care about anything other than doing a great job for their constituents? Well, that sort of sums up how everyone should feel about Lefkofsky and Groupon, and os probably why the stock price went up when the announcement was made. The guy is a billionaire, and made his mark as a serious and accomplished executive well before Groupon – so he has nothing to prove but that he can help Groupon pivot away from its daily deal funk into something much more powerful. I have some thoughts about that too, which I will share soon, too and they have to do with a concept that is getting a lot of traction now as a result of the intersection of mobile + digital + payments. One thing’s for sure, though. Once he leaves his CEO post, I will bet money that Lefkofsky doesn’t make an album….
This Tweet highlights an interesting piece from CNN Money that advises against hopping back on the Groupon bandwagon just yet. But while the report argues that Groupon’s earnings aren’t quite as impressive as they seem, it also acknowledges that its continued pivot away from daily deals is a good thing. On that, I think we can all agree.
TOPIC THREE: Gone In 674 Second? UK Shoppers Get Impatient
Why It’s Hot
EMEA Editor Chanel Smith took a look at a crazy finding from her side of the world this week: British consumers only wait five minutes and 54 seconds on average before ditching in-store queues. Sixteen percent said they wouldn’t wait more than three minutes in a store, and in some parts of the country, Brits only wait four minutes and 44 seconds before leaving for greener (quicker?) pastures.
The study also found that the long-term damage long waits can have on consumer relationships is pretty serious, with over half of the consumers surveyed indicating they wouldn’t return to a store after a long wait.
I’m not sure why Brits are in such a hurry, but this certainly puts physical retailers in the country in a tough spot.
Wait, don’t these guys and gals don’t have their noses buried in their smart phones playing games or responding to emails while standing in line? Six minutes can clear an awful lot of emails … But seriously, this is an interesting finding and supports a number of the use cases contemplated by merchants for self-checkout via mobile and line busting applications. What’s particularly interesting here is the outsourcing of what used to be the merchant’s responsibility, checkout, but now via the mobile device, is an acceptable tradeoff for standing in line, particularly since the time it takes to scan items and bag items is probably a lot more than 6 minutes!
@Quinn_Western: I’m standing in line at the first Starbucks wondering “Why am I waiting this long for a coffee?” #journalism+coffeepic.twitter.com/DK7Xt2qo35I’m standing in line at the first Starbucks wondering “Why am I waiting this long for a coffee?” #journalism+coffeepic.twitter.com/DK7Xt2qo35
Yes, but would you have left after already waiting for six minutes? I guess we’ll never know, but people do crazy things for Starbucks.