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Goodbye Google Checkout, hello Google Wallet
Google wants one payment platform for consumers and merchants.
Topics: aite group llc, Android, credit card, Debit card, Digital wallet, divya agarwalla, eBay, eBay Inc., Google, Google Music, Google Wallet, m-commerce, Mobile, mobile commerce, mobile payment, Payment processor, PayPal
Google Inc. is changing the name of Google Checkout to Google Wallet, using one brand for consumers who make online payments and merchants who accept them. Google Wallet is the digital wallet the company launched this year for use with smartphones.
“This is an important first step in creating a single wallet so consumers can have a simple and consistent way to pay whether they’re shopping in-store or online," a Google spokeswoman says. Google announced Google Wallet this year as a place to store payment information on some smartphones so consumers could make in-store transactions. A registered shopper uses the service by tapping her phone against a contactless reader at a checkout counter.
Consumers logging into their existing Google Checkout accounts are redirected to a notification screen informing them of the name change. Any information they stored in their Checkout profile, such as credit and debit card numbers and shipping and billing addresses, is still there, Google says.
Upon checkout at a participating merchant, including Shoebuy.com,TigerDirect.com and Buy.com, the consumer enters his Google Wallet user name and password to complete the purchase. Merchants need change nothing, Google says, other than to display new artwork that won’t be available until after the holiday shopping season.
Google also tweaked how merchants can use Google Wallet as a payment choice for their mobile commerce sites. “The expanded service means merchants can retain control of their payment processing,” says Divya Agarwalla, Google Wallet product manager. Previously, all Google Checkout transactions had to be processed through Google, she says. Participating merchants have the choice of sending a Google Wallet mobile transaction to their current payment processor or using Google, she says. This change only is available for mobile commerce sites. Google eventually will make the service, in its new guise, available to e-commerce sites.
With the new payment processing option, Google sends the stored payment card data from the consumer’s Google Wallet account in an encrypted format to the merchant. Upon receipt, the merchant decrypts the data and sends it to its payment processor for approval. Merchants pay Google no transaction fees in this scenario. Otherwise, for merchants with monthly Google sales between $3,000 and $9,999, Google charges 2.5% plus 30 cents for each transaction it processes.
Currently, Fandango.com and MovieTickets.com accept Google Wallet via their m-commerce sites. Google Wallet especially should make mobile transactions easier for consumers, Agarwalla says. Consumers often abandon mobile shopping carts when trying to enter 16-digit credit card numbers and shipping addresses, she says. After selecting tickets for a movie, the checkout page on either site displays a button to Pay with Google Wallet. A tap on it opens a new mobile web page where the consumer enters her Google user name and password to confirm the payment.
Google Checkout never achieved the success of its chief competitor, PayPal, a unit of eBay Inc., says Rick Oglesby, an analyst at research and consulting firm Aite Group LLC. “One of the keys to success for digital wallets is they need to be enabled on growing and thriving marketplaces,” Oglesby says. “PayPal would have been nothing without eBay.” Apple Inc. counts some 225 million accounts enrolled in its iTunes music and video store, he says. Google Checkout debuted in 2006. Google says there are "tens of millions" Google Checkout users, but declined to release a specific total.
Now, with the success of Google’s Android operating system for smartphones, and this week’s debut of Google Music, Google’s prospects for success improve, Oglesby says, especially by putting one brand on the payment service. “It’s the right strategy,” he says.