There used to be a time when e-commerce was the buzzword associated with online shopping. In the early dot-com days, many wondered if consumers would build enough confidence and familiarity to buy products online. That all changed in 2010 with Black Friday and Cyber Monday sales figures. According to comScore, Cyber Monday 2010 posted sales of $1.028 billion in online spending which represents 16 percent increase over one year ago and the biggest online spending day in the history of humankind. Santa couldn’t be happier with all the deliveries his team will have to make this Christmas season.
Even online merchant providers such as Paypal have noticed gains unseen in previous years. Paypal announced a whopping 300 percent increase in December up to December 15th with its mobile payments compared to the same period last year. However, it had already broken records in November 2010 with a 310 percent increase in mobile shopping.
Paypal is an established name for transactions on the Internet. The company handles approximately 16.5 percent of all online transactions in the U.S. alone. On Black Friday alone, Paypal experienced a 27 percent increase in mobile payments which is most attributed to the fact that more consumers are connected through their smartphones and are now more comfortable making purchases from their mobile phone.
Paypal’s President of Platform, Mobile and New Ventures even stated that within the next five years, it will be commonplace for consumers to pay for purchases via their mobile phone as more retailers offer mobile storefronts to sell products and services.
Paypal’s own mobile service has evolved significantly since it entered the market in 2006 with an SMS solution. While the SMS solution allowed users the ability to text friends money, it failed miserably due to unfamiliarity with SMS and other limitations such as the cost to send text messages. Today, U.S. telecom providers provided unlimited text bundles which would have helped Paypal with better adoption of its SMS solution.
The arrival of the iPhone in 2007 changed the ball game for mobile payments. Built on years of use and familiarity with the iPhone user experience, users are now accustomed to the idea of downloading and using apps on their smartphone. In December 2010, Paypal Mobile released a new version of its Paypal Mobile app which allows users to send and receive money with their existing Paypal account. Users still must create new accounts online and follow the necessary steps to get verified. However, once all those steps are fulfilled, the Paypal Mobile app provides a seamless experience to view account history, add funds, withdraw fund, and add additional credit cards.
One of the newer features in Paypal Mobile allow two users with Paypal accounts to bump their iPhones and seamlessly deliver funds between each other without the need to follow several authentication steps. A split bill feature allows users to divide the cost of a bill which includes the food cost and tips among several people what an ice breaker feature to stop individuals for acting like the Grinch at the dinner table.
Perhaps the most favored feature is one that notifies the user of any deposits made to their Paypal account. If you’re an online small business that relies on Paypal to transact, there is nothing better than receiving a notification pop-up on your iPhone to give you the “cha ching” willies with each deposit that is made. This feature is a personal favorite.
Overall, the Paypal Mobile app experience is very good and has been designed to follow common user experience protocols established by Apple. As a result, it is no wonder that Paypal experienced the surge this holiday season with mobile shopping transactions. When technology marries convenience, simplicity and accessibility into one convenient device and app, the tipping point to success is achieved rather quickly.
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