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Money20/20: PayPal COO on Facebook Messenger Integration, Contextual Commerce

PayPal HQ 2015Fresh off announcing a plan to bring PayPal payments to Facebook Messenger, PayPal Inc. Chief Operating Officer Bill Ready said the move was part of the company’s larger push to serve what he called “contextual commerce”—enabling mobile payments to take place in areas outside of the traditional checkout environment.

Announced in a blog post on Monday, the Facebook integration will enable U.S. consumers to select PayPal as a payment option across more of Facebook’s commerce experiences, such as Messenger. Users with linked accounts also will receive messages from PayPal via Facebook Messenger, including e-receipts.

Speaking to a jam-packed ballroom at Money20/20 in Las Vegas on Monday afternoon, Ready outlined how the integration—which builds upon an existing relationship between the companies—fits into PayPal’s strategy of integrating payments into mobile experiences, such as messaging and other social platforms. “Consumers and merchants are going to meet one another in a lot of places other than the traditional checkout, and in those places it’s important to create a connection so they can seamlessly transact,” Ready said. In some markets, such as China and other Asian countries, payments already are widely integrated into messaging services, such as WeChat—which have become in essence payment services, Ready noted.

While messaging and payments have yet to become that closely connected in the U.S., plenty of what Ready called “organic commerce” already is happening in the American market, he said. “If you look across social platforms, like Facebook and Instagram, you see a lot of individuals posting photos of things they’re selling or things they’ve made,” he observed. “So the question is how do we as a payments ecosystem start to enable [social platform purchases] to happen in a more seamless way, because users are there already.”

PayPal processing subsidiary Braintree Payment Solutions made an early move in that area in 2015, partnering with Pinterest to enable consumers to make purchases directly from Pinterest posts, noted Ready, who served as Braintree CEO until PayPal acquired the company in 2013.

In his address, Ready also highlighted the success of PayPal OneTouch, the company’s one-click mobile checkout service. Just over a year after exiting beta, OneTouch has more than 30 million active users and 15 million participating e-merchants, according to Ready. The service has increased conversion rates significantly by solving a particular pain point for consumers and eliminating the need to enter payment information when making a mobile purchase. “Consumers tend to adopt solutions to pain points really quickly,” he said, citing Uber and the Starbucks mobile app as examples.

But there’s plenty more work to do to improve the process of mobile purchasing, said Ready. He noted that, depending on the data source, between 60 to 70 percent of e-commerce shopping takes place on mobile devices—but only between 10 to 30 percent of actual purchasing happens on those devices. “Over time shopping and purchasing should start to happen at the same rate,” he said. “People are just waiting for the buying experience to catch up.”

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