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12.06.16

Can PayPal, Google Holiday Promotions Spur Long-Term Adoption?

paypal-holidays-p2pPayPal and Google’s Android Pay are making the holidays more festive with new promotions, but will they lead to more consumer usage? PayPal says it’s making its P2P payment service “more personal and heartfelt,” while Android Pay is offering U.K. users a free gift when they use the mobile wallet for purchases.

Android Pay is offering a free gift every time a consumer uses the m-wallet in a store or on the Transport for London network until the end of the year as part of its “shop. tap. reward” program. The in-app gift appears in the form of a virtual cracker. Consumers tap on the crackers to reveal their prizes. A physical cracker is a cardboard paper tube, wrapped in brightly colored paper that’s twisted open to reveal what’s inside. When the tube is twisted it makes a popping or cracking sound.

Prizes include virtual coins, which can be collected and redeemed for a coffee shop gift card, or a gift card to myriad merchants, such as a £500 (US$636.76) House of Fraser gift card, a £500 Currys PC World gift card or a gift card for a pair of tickets at ODEON Cinemas.

Android Pay launched in the U.K. last May, mobile wallets are competing against entrenched user behaviors and habits, according to Zilvinas Bareisis, senior analyst with Celent’s banking practice. “Given that their value proposition so far has not been much better than the established alternatives—in fact, tapping a contactless card is easier than using a contactless mobile payment—incentives play a big role in trying to get the customers to try and start using new instruments,” he tells Paybefore. “I expect to see a surge in mobile transactions over the promotion period, but only time will tell whether that will produce a desired lasting effect.”

More than 60 percent of Americans prefer cash instead of presents during the holidays, according to a recent PayPal study, but 63 percent of consumers don’t give money because they worry the gift isn’t personal enough. To solve this conundrum, PayPal commissioned designer Jonathan Adler to create several designs for virtual cards to help consumers in the U.S. and Canada personalize P2P gifting. Consumers log into their PayPal accounts, select Send Money, pick a virtual card design, choose the amount of the gift and press Send.

Holiday designs for P2P gifting are available in 17 countries. While U.S. and Canadian consumers will be able to choose Adler designs, the other countries—Australia, Austria, Belgium, Denmark, France, Germany, Italy, the Netherlands, Norway, Poland, Russia, Spain, Sweden, Switzerland and the U.K.—can choose non-Adler designs created specifically for their markets, according to PayPal.

“Our partnership with Jonathan is unlike anything we’ve ever done, and helps consumers stress less,” said Patrick Adams, chief marketing officer, PayPal North America. “His unique holiday card designs make sending money easy and fashionable—something that gift cards and traditional holiday cards simply don’t provide.”

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Image Credits: PayPal

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