Since before the turn of the century Paypal has been ubiquitous with online payment. Now Amazon is hoping to change that.

The problem is that Paypal is as likeble as a camel on Wednesdays, and if you’re an online merchant it’s very likely you’ve either had a negative experience with Paypal or at least know someone who has.

In fact there are multiple websites just dedicated to collecting camp fire stories of users’ experiences:

Stories of funds being frozen, transactions being reversed, and money simply vanishing are all too common. On Reddit, user bhavicp gives a relatable story of a retailer wishing to wane from his Paypal addiction but simply cannot:

Online business owner here. I would LOVE to get rid of PayPal on our website. Fact is, over 70% of our users use PayPal even though we have multiple other options, including but not limited to 2 checkout, credit cards (directly), skrill (moneybookers) and bit coins.

Given this crusade it’s shocking that a suitable replacement hasn’t surfaced yet in over a decade, although many have tried (most notably Google Wallet), but Amazon is hoping to finally break from the pack.

Amazon is hoping to be to ecommerce what Facebook is to the entire internet. Namely giving users the ability to pay with their Amazon credentials on any retail site that supports it without the user ever leaving the site.

Currently one of the biggest barriers a user has in purchasing from a new site, whether it’s a boutique clothing shop or a large retailer like Staples, is that they generally have to register on the site, fill in their name, address, credit card, childhood pet’s name, etc.–or use Paypal.

Amazon pushing for an alternative solution could potentially change the ecommerce landscape in a major way.

The program hasn’t launched quite yet, so below we’re going to speculate as best we can on the pros/cons of the program:

Pros  (Amazon)

  • Amazon boasts 215 million active Amazon account holders, Paypal “just” 132 million active accounts, giving it an inherent advantage in adoption rates
  • Your customer won’t ever have to leave your site if they are logged into Amazon, creating a better user experience, compared to Paypal where you’re taken off-site and back in
  • It’s not Paypal

Pros (Paypal)

  • It’s likely already installed on your site and everything is linked up properly
  • Despite its flaws it is a proven, working model that retailers and customers are comfortable with
  • Similar to Facebook, customers (and retailers) might be weary of giving Amazon access to all their browsing/purchasing habits

So for perhaps the first time since its inception, we have not only a potential legitimate alternative to Paypal, but one that has the ability to possibly take it over one day (note our words of caution).

If implemented properly there’s little reason to think that Amazon Login can’t be wildly successful, given of course Amazon’s name doesn’t become tarnished as Paypal’s has.

How Shoppers Browse and Buy CPG Products Online And Offline

The Consumer Packaged Goods Shopper Survey 2017
 

About the AuthorTien Nguyen is a co-founder of CPC Strategy and deals with data feeds in his waking hours and often in his sleep. He spends his free time with Rubik's cubes while rooting for the underachieving Raiders and UCLA sports teams where he graduated with a mathematics/economics degree. See all posts by this author here.