As recent announcements from Apple Inc. (NASDAQ:AAPL) and Amazon.com, Inc. (NASDAQ:AMZN) show, Paypal Holdings Inc (NASDAQ:PYPL) is experiencing tough competition as many tech companies that have the payment card information of millions of consumers try to muscle in on its turf. This escalating competition may be related to the decline in transaction volume recently recorded by PayPal. To counter the threats, PayPal has in the recent times introduced a number of mobile-friendly payment services. This, together with the company’s familiarity with consumers, could enable the online payment giant win the fight.
Recently, the company said that the One Touch payments solution which enables user to buy without keying in their log in details every time they do so is being used by over 50 million accounts. This represents an increase from the 21 million that was recorded as of last April and translates to a quarter of PayPal’s 200 million total active accounts.
The company also say more than five million merchants now support One Touch. The company also claims that according to comScore study, the solution’s conversion rate is an impressive 87.5%. One Touch is mainly used by mobile phone users who find it very uncomfortable entering their details every time they want to make purchases. They solution is also available on PCs. This explains why despite most sites reporting big traffic from mobile phones, a big number of online orders recorded by online retailers come via PCs.
According to estimates from Adobe Systems Incorporated (NASDAQ:ADBE)’s analytics arm 56% of Thanksgiving weekend site visits come from mobile devices. In the fourth quarter of 2016, PayPal handled a total, of $31 billion in mobile transactions, representing 53% increase. This is however just 31% of the company’s total transaction volume.
Apart from One Touch, Venmo, PayPal’s social-oriented payment system enables users to easily and conveniently send money to family and friends, split bills and share whatever they are purchasing with others. This has boosted the company’s mobile payment platform.
THE MORNING REPORT
Start your workday the right way with the news that matters most.