by Tyler Cowen
on October 8, 2013 at 3:35 pm
in Uncategorized, Web/Tech |
The site is here, and they call it Amazon Payments, it seems. Instead of PayPal, I suppose. Who will win that competition?
For the pointer I thank a loyal MR reader.
I actually paid money towards a Kickstarter project using Amazon Payments (it was a couple of months ago, I think). For me, it was much easier from a peace of mind perspective to pay in this way than it would have been to either provide Kickstarter with my credit card information or the particular Kickstarter project’s company.
Cool that Jeff Bezos is a loyal reader. Planet Money just did a fascinating podcast tracking the 5 day delay in their cash transfer from Amazon Payments to Chase Bank. Not using the Paypal-like feature mind you, and the slowness is the banking systems fault.
This has been around for several years – maybe 5-6 years. It doesn’t have the flexibility to handle the many different types of transactions that PayPal does. It really only works for plain vanilla ecommerce companies. Amazon gave us some heavy sales pitches earlier, with some good incentives to try it. But it just can’t handle the payment needs of our website.
As an ecommerce exec, I have mixed feelings on it. On one hand, I think it would reduce purchase friction for a lot of customers and could potentially boost conversion rates. I like that. But it also means feeding our purchase information through Amazon. I have heard of numerous examples via marketplace and partnerships in which Amazon has used the purchase information of partners to compete directly and undercut prices. So I would have to think long and hard about whether I’d wanted to use this service on our website, even if the product was robust enough for our needs. The fact that it has been around for so long without gaining traction makes me wonder if others feel the same way.
But paypal is such a shitty company. I refuse to use paypal unless its absolutely necessary.
But you are such a shitty commenter. Why pay attention to you?
The companies Stripe(http://stripe.com) and Square(http://square.com) are actually PayPal’s real competitors for online and offline payments respectively. Amazon Payments is pretty much an also ran with the exception of Kickstarter.
Other than Amazon’s name I couldn’t see why anyone would decide to use Amazon Payments.
I can think of about six reasons – among them fluency of the process, reluctance to share card details with yet another organisation, the fact that delivery addresses – for yourself or for gift recipients – probably won’t have to be retyped, the fact that I feel comfortable doing things I have already done successfully in the past.
But “other than Amazon’s name” is a rather demeaning way to dismiss the importance of trust and reputation. “Other than the Archbishop of York’s name, I don’t see why I should prefer to buy a used car from him than from a random man I have just met in the pub.”
All the reasons you listed are actually great reasons, but they’re reasons to use Amazon’s API, not reasons to not-use PayPal, if that makes sense. It’s a developer API, so you’re right as a developer I would probably choose them if I was shipping physical items. But if I was looking for a PayPal style service I would be looking at Square and Stripe.
Sorry for the confusion I was really saying I couldn’t see why a developer would integrate with Amazon Payments. Not why a customer would find them appealing.
“Who will win that competition?”
Do prison commissaries accept bitcon? That’s where the whole thing is headed.
I sure hope you are kidding. Bitcoin has as many chances of succeed as a general online paying system as bottle caps. We’d have better results using Apple general stock as a medium of exchange.
Given that PayPal are running a scam there they don’t release money for 3 weeks, in effect getting an interest free loan, for which they charge extortionate fees, I hope anyone wins except PayPal.
I trust Amazon more than Paypal. If I have to choose between three online retailers, one using Amazon, one using Paypal, and one processing payments themselves, I’ll go with the one using Amazon.
As others have mentioned, this isn’t new. And PayPal isn’t the only competition. Google Wallet and American Express Serve offer similar services.
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The point here isn’t Amazon Payments, and neither is that the new thing. The new thing is that this combines Amazon Payments and OAuth, so that you can allow people to log into your web site with their Amazon account (just like those “log in/sign up with Google” or “with Facebook” buttons you see everywhere nowadays). So by integrating your site with Login with Amazon, you get both an authentication system and a payment processing system simultaneously. It turns on Amazon’s existing, large, reputation as a “site you have accounts on”, not its much smaller reputation as a payment processor.
As someone who’s done some payment processing integration, and read some Amazon documentation, I’m mildly skeptical of their claims that this will speed time to development (it’s not like Stripe and OAuth are hard, and have you ever tried to read Amazon documentation?!) But I *do* think there’s some there there, particularly given that different sites have different demographics they’re trying to reach, and different payment processors have different uptake demographically.
What I’m REALLY interested in is what Amazon is looking to get out of this. All of a sudden they have a lever for tying their knowledge of you as an Amazon customer into your login and purchase habits on third-party web sites? That must be faaaaaascinating, particularly given that Amazon is stuffed to the gills with data ninjas.
I’m certain Amazon is getting the better end of this deal. But it is new and interesting.
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As someone who runs an ecommerce website more as a hobby than as a full time business, I think this is really interesting. I hate the paypal checkout experience and I think our conversion rates are lower because of it. I think you definitely could have a higher conversion rate with Amazon over paypal. And there are some intriguing bells and whistles. For instance, you can setup rules to offer additional items to people during the check-out process to try and upsell. You can do that either with your own products or through Amazon and collect their 8.5% referral fee. That is something that paypal doesnt offer out of the box.
However, i loathe the idea of having to change out my order workflow and payment / order notification interface. So, not sure at the end of the day it is cool enough to make me switch. but cool enough for me to write a comment!
I disagree with people who say Amazon Payments is old.
It may have existed before but I only saw it for the first time when it was added to the Gogo (inflight wifi) payment options. Then a week later I see that Café Press is using it too. I think both of these are very recent.
It was almost too easy. I am a dedicated Amazon customer but I can see this becoming too dominant quickly for a lot of medium-sized sellers. Is Amazon threatening both those sellers (with the information Amazon learns) and the credit card companies that probably get higher fees from small venders like Café Press than they do from Amazon?
Amazon. Why? The lack of friction for their customers. Their check-out process is superb. I’d love to use that to sell stuff from my website.
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This is the old Amazon Payments system without requiring order detail handling by Amazon, as I understand it. So, Amazon knows nothing more than the amount of money being approved for the purchase.
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