Scribd
Upload
128 views1 page

Pay Pal

PayPal has enjoyed success in online commerce due to its customer-focused and growth strategies such as allowing anyone to easily send and receive payments online without sharing financial details. While Google Checkout may pose a threat, it currently lacks many of PayPal's versatile merchant services features. PayPal offers more payment options, virtual terminals for retailers, APIs for integrating payments into business systems, and direct payments from non-PayPal users. Given these advantages, PayPal's merchant services need not be threatened by Google Checkout at this time.

Uploaded by

Rekha Bhatt
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
128 views1 page

Pay Pal

PayPal has enjoyed success in online commerce due to its customer-focused and growth strategies such as allowing anyone to easily send and receive payments online without sharing financial details. While Google Checkout may pose a threat, it currently lacks many of PayPal's versatile merchant services features. PayPal offers more payment options, virtual terminals for retailers, APIs for integrating payments into business systems, and direct payments from non-PayPal users. Given these advantages, PayPal's merchant services need not be threatened by Google Checkout at this time.

Uploaded by

Rekha Bhatt
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

PayPal Merchant Services

In April 2006, PayPal is closely monitoring the launch of Google Checkout, an online
payment service. PayPal has enjoyed its success so far in online commerce even before its
integration into Ebay because of its several strengths. The main of them have been simple
customer focused and growth strategies. PayPal allowed any individual or business with an email
address and credit card/bank account to send or receive payments online. Setting up account at
PayPal and takes less than 5 minutes and provides ease of transaction to PayPal account users
without them revealing their credit card or personal information to third party. In addition, to
individuals or small businesses that were unable to accept credit card payments from consumers,
it provided a quick and more convenient transaction method. The initial success of PayPal was
also influenced by the aggressive marketing campaign that gave incentives ($10 per) for each
referrals and new user account applications deposited directly to their PayPal accounts.

The company grew significantly through forging strategic partnership (Ebay), recruitment
of large accounts and through international expansion.

Google’s payment initiative is potentially a serious threat to PayPal since it directly


competes with PayPal’s market. Google has offered a limited trial of its payment service
alongside its beta test of Google Base. This will provide ease for Google buyers to pay using
their credit cards and for sellers to process payments since this is free to buyers and inexpensive
for sellers compare to other options.

However, upon analyzing the case our team finds that Google Checkout lacks several
features that make PayPal more attractive to merchants. PayPal is more versatile in terms of
merchant services. Especially for small merchant features, PayPal is vastly superior to Google
Checkout.  PayPal offers more flexibility with option for credit card, debit card or deduction
from bank account, while with Google payments can be made only using debit or credit card.
PayPal sales can not only be processed online by the customer, but also by the retailer through a
virtual terminal. There are no virtual terminals for Google Checkout. PayPal’s Application
Processing Platform (API) allowed merchants to integrate PayPal into their back office system,
including accounting, order management, shipping/tracking and returns. It allows merchants
to keep track of their inventory. Google has no such feature. PayPal’s Payment Pro allowed
sellers direct payment from buyers who did not have a PayPal account. With 2.5% fee for sale
compared to 1.9-2.2% of PayPal, for heavy volume merchants, the actual low transaction cost of
become irrelevant. Also, in international market PayPal has more strategic presence.

Therefore, we recommend that in terms of merchant services, PayPal need not be


threatened by Google Checkout. However, it will need to remain competitive in terms of
transaction cost, offering new features.

You might also like