June 28, 2011
How Google Wallet will Impact eCommerce Retailers
MasterCard, Citi, Sprint and FirstData are all working with Google to change consumer payment behavior, PCI compliance and security through new payment technology. If this becomes popular, it is likely to affect eCommerce. The Vice president of Commerce and Payments for Google released a statement indicating the company’s collaboration to create the next generation of mobile payments.
Using NFC Technology
Google is attempting to form an open commerce system that will allow consumers to pay using near field communication (NFC) technology while acquiring promotions. This activity will occur with the simply tap of phone against a reader in an offline manner.
Shoppers at land-based stores will be able to make payments using the card stored on their Android phone. Shoppers will wave the smartphone near the NFC equipment which accepts the transaction. The device will then transfer back any promotions and deals.
Affect on the eCommerce Industry
Despite targeting physical retailers and other services providers, the technology will affect how customers shop, the payments they use and how transaction data is managed. If a fast, secure system is developed, Google Wallet could become an instant success.
Affect on Customers
Once implemented, the application will change the expectations of customers. The technology is expected to eventually replace credit and debit cards. Therefore, since the average American carries over seven payment cards, Google Wallet could eliminate these from their wallet altogether. Also, the application could spread payments across multiple cards.
Integration with Google Offers
Google is also planning to integrate its new Google Offers service which is a direct competitor of Groupon and LivingSocial. Shoppers will easily be able to redeem deals and promotions instantly from the application. Google has currently been testing numerous consumer deals that range from a 20 percent discount on boots to a “deal of the day”.
Additional Features
Since the Wallet is a mobile application, Google intends to have more features than a physical wallet and credit cards. For instance, it can be used for store loyalty information, track gift card purchases and integrate with personal finance software. This is far more convenient than standard credit cards.The Google Wallet could change the way customers shop, interact and live their lives. This is one of those inventions that is game changing. As long as Google can maintain a high level of security and effectively process transactions, this application will be one of the most useful inventions ever created.
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