A Business Technology Place

Thought readings 8

Each week I capture, mark, and comment on blog posts and news articles around the internet. This is a short-list of three links that I think others will find valuable for their thought lives.

  1. 6 ways to Increase Prices on Your ECommerce Site by Gagan Mehra of Practical eCommerce.  Pricing of products to maximize profits is an important topic and can lead to complex financial analysis. In this post, Mehra does a good job of reviewing some practical tips and ideas that could help eCommerce operators increase their average cart values.
  2. Is the Digital Wallet Going Analog? by Demitri Kalogeropoulos of the Motley Fool. Lots of companies are trying mobile payment solutions in the market. But what caught my eye in this article was the mention of Hope Depot having an option for PayPal payments at the point of sale in their stores. The customer doesn’t need a phone or plastic. They simply use the touch screen with their PayPal credentials to complete the purchase.  Could the future of payments not involve mobile devices?
  3. Wal-Mart to Offer Cash Option for Online Purchases by Christina Cheddar Berk of CNBC. Wal-Mart is trying a pay with cash option for online customers. If the customer elects to pay with cash then they have 48 hours to complete their purchase at a store location. They then choose if they want the merchandise shipped to the store or to their home. What this means is that the store cash registers must be able to pull information about the online purchase. Nifty integration. But will this be a hit with consumers? Seems to me like it eliminates the convenience of ordering online.

Let me know what links you shared, tagged, or commented on this week.

E Pluribus Unum and Change

New Penny
New TailPayPal gives Home Depot the Finger
PayPal gives Home Depot the finger. (A good thing.)

I don’t like clutter in my car. So after a family trip, a penny in my cup holder stood out along with a straw wrapper. Kelly’s milkshake.

I did not recognize the tail-side design. The familiar Lincoln memorial had been replaced by a thirteen stripe shield bearing “E Pluribus Unum.” Out of many, one.

I missed the change. (Get it?)

I think I missed the change (circa 2010) because I have gotten away from change. The two places where I used change most were the office lunch room cafeteria and the office vending machines. The former takes cash and checks, so to quit accumulating change, I went to checks using a secondary free checking account from Ally. Checks have gotten very efficient to process, getting converted quickly from paper to digital. Family checks are now deposited at the kitchen table using an iPhone or iPad. However, I doubt Ally is making much off my lunch money.

The second place I used change was our office vending machines. A little over a year ago, our vending machines got cellular antennas and magnetic / RFID card readers. The prices went up to fund the change, so my number of transactions went down, but I’ve been tapping my Amex smart chip ever since. No change.

These checks and these RFID card readers cost merchants money. There has been resistance in the U.S. to install new RFID equipment when “swiping” plastic works fine. What problem does tapping really solve? I think it solves the problem of card reader salesmen quotas.

Enter PayPal at Home Depot. I spotted PayPal at Home Depot just last week. What do I need? My finger, my phone number, and my PayPal pin number. I don’t need anything plastic, magnetic, paper, leather, and I don’t need a phone.

I don’t need batteries. My finger runs on food from the cafeteria and the vending machines.

What equipment do the merchants need to install? Nothing. PayPal ties into existing PIN pads. No RFID readers, no phone readers, no squares, and no triangles. It’s low tech. It’s simple.

There are a lot of companies and a lot of technologies out to transform the payment landscape: Square, Google Wallet, Apple’s iWallet, CashEdge, and even my company’s own DPXPay. But will PayPal’s simple finger, no battery, merchant-friendly approach beat them all? E Pluribus Unum? Out of many, one?

Guest blogger Jeb Cashin counts pennies at Harland Clarke by day… and often at night.

A note from Bob Williams – I’ve known Jeb for about 15 years and we share a common employer. He’s been a colleague, an internal customer, and my direct manager during that time. Many thanks to him for providing this thoughtful and entertaining look at the landscape of payments. 


Putting perspective on P2P payments

P2P payments are coming. But who is using them?
Just how ready are we for instant P2P payments? It’s all the buzz in the financial world and players are scrambling to get in the space. P2P, or person-to-person, payments have been around for awhile. I started using them with PayPal for some eBay transactions years ago.  PayPal has advanced the P2P features over the years. If you haven’t tried their mobile interfaces then it’s worth your time


The original P2P payment

I tried to get some family members using PayPal for P2P payments, but….
When I suggested some family members try PayPal with me for some money exchange you would have thought I was speaking a foreign language. Maybe so, but I didn’t talk about the technology as much as I did the benefits: Instant payment, no cash,uses email address, no fees. Habits are hard to change, and that includes how we make payments to other individuals. At least with those in my circle of relationships it appears they are  making P2P payments with cash and check.

Are electronic P2P payments impersonal?
I wonder if wider acceptance is hindered because this type of payment is viewed as impersonal? Giving cash or writing a check forces an interaction. It’s giving something you have. Almost like a personal mark. Sending a P2P payment could be invisible. The recipient just receives an email with notification of receipt.

Or is it a trust issue?
It could also be that people don’t trust the delivery of the electronic delivery of a P2P payment.  Cash and checks provide a physical artifact representing the payment. I’ve heard some of the older generation in my family use this argument when talking about electronic bill pay. They like the paper trail it generates. It gives them a feeling of security and trust.

Reality is, we don’t make many P2P payments.
How often do we pay someone versus paying an organization or a business? For me, not much. Even as I think back to college and high school days, I don’t remember large number of money exchanges with friends. Most times people paid their share.

So when I put this in perspective. I think P2P payments are a good option to have for financial transactions. But they are just a small part of a full range of payment options that we’ll all need to conduct our daily transactions.