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Posted by Denée Carrington on September 5, 2013
Today, PayPal launched a redesign of its mobile digital wallet in the US, Australia, Canada, China, Hong Kong, Japan and the UK[i]. Although the digital wallet marketplace welcomes new or evolving competitors regularly, others - like Google Wallet- have gone back to the drawing board. To date, no third-party wallet provider has yet to achieve “broad-scale adoption” with both consumers and merchants, or, said differently, “success” with proximity or in-person mobile payments.[ii] Although most consumers around the globe have used PayPal’s online digital wallet, and some may have heard of or perhaps even used its mobile digital wallet for in-person payments, adoption is still a long way from mainstream. Google Wallet helped to drive awareness of mobile digital wallets — a useful byproduct for all competitors — yet it failed to deliver consumer adoption or merchant acceptance. With the latest wallet update, PayPal is poised to accelerate adoption by embedding value-added services designed to give consumers a reason to use the PayPal wallet across multiple categories and give merchants a reason to consider adding yet another payment method.
Some of its value-added services include:
Even with its cool new features, winning consumer adoption and merchant acceptance (the “success” equation) won’t be a slam dunk. PayPal must:
Nothing will dampen consumer curiosity and enthusiasm faster than failed attempts to use loudly touted cool new features and services. PayPal is facing the proverbial chicken and egg situation of mobile payments. PayPal says it has been very focused on demonstrating and delivering value to merchants, but only time will tell if it receives the required return on its investment to soon claim “success” with in-person mobile payments.
So, what do you think? Does the new PayPal mobile digital wallet have the winning formula for success in driving consumer and merchant adoption at scale?
[i] Some features are not immediately available in all markets.
[ii] Starbucks’ closed loop, stored value, mobile payment app is the most successful mobile digital wallet for in-store payments to date.