June 7, 2012, 1:37 PM

67% of mobile shoppers pass on plastic when checking out

Two-thirds prefer PayPal and other alternatives that require less data entry than cards.

Bill Siwicki

Managing Editor, Mobile Commerce

Lead Photo

67% of mobile shoppers pay for purchases using PayPal or another alternative payment method while 33% pay by credit or debit card, finds a study by ShopVisible of 23,000 web and mobile client transactions, thousands of which were mobile. In standard web transactions, the results were reversed: 62% of buyers pay by credit card and 38% by alternative payment methods.

Alternative payments overcome part of the barrier to greater use of mobile commerce sites and apps, ShopVisible says, by sharply reducing the amount of data a customer must enter to complete a transaction.

“These results decipher some of the code to unlocking the potential of mobile commerce,” says Sean Cook, CEO of e-commerce and m-commerce platform provider ShopVisible. “Mobile is a different animal, as this research shows. Lacking a simple alternative payment method could crush any retailer implementing a mobile commerce strategy. Even if alternative payment methods don’t constitute a large percentage of your existing web business, you should reconsider the relative importance when it comes to your mobile strategy.”

Some retailers have concluded PayPal can be a potent presence in m-commerce. TigerDirect redesigned its m-commerce site in September 2011 and as part of the revamp included PayPal Mobile Express Checkout to speed purchasing for mobile shoppers. Vitacost.com Inc. added PayPal and Bill Me Later to its m-commerce site in March. TigerDirect is a unit of Systemax Inc., No. 25 in the Internet Retailer Top 500 Guide. Vitacost.com is No. 86.

Sucharita Mulpuru, a Forrester Research Inc. analyst, recommends PayPal Mobile Express Checkout as a way to bypass form-filling during checkout on a mobile device. “The conversion is much lower on phones than online, but we do know with PayPal Express Checkout the conversion is higher,” she says.

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