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Amazon Offers Deals for Using Payment Service Beyond Its Own Marketplace



With holiday shopping underway earlier than ever for many people this year, retailers and brands have been rolling out deals nonstop for weeks, trying to entice consumers to shop with them. Amazon is no exception to this, but the eCommerce giant also has another proposition: Shop at other merchants, and we’ll give you a deal if you use our payment service.

Listed on the Amazon Pay website, the deals include $10 off on Crayola.com, a free month of service from Nord VPN, and 30% off a purchase from Copper Compression, among discounts on other brands, with links leading away from Amazon’s core marketplace. The company also has a holiday gift guide, with most of those items also listed outside of Amazon.

Though the company has a nearly 50% share of the eCommerce market, according to PYMNTS proprietary data, the emphasis on Amazon Pay is a way for the Seattle-based firm to try and capture a piece of those sales that slip through to other merchants as digital purchases explode. PYMNTS research shows that 87% of consumers plan to do some shopping online this holiday season, a 10 percentage point jump versus last year.

See: Holiday Shopping Outlook Suggests ‘Amazon Christmas’ May Be Underway

Amazon Pay was launched in 2007 and allows consumers to use their Amazon accounts to pay for purchases on external merchant websites. The company last year also teamed up with Fiserv and ExxonMobil to offer touchless payments using Alexa at more than 11,000 gas stations across the U.S.

Read more: Amazon Pay Rolls Out Touchless Payments With Alexa At More Than 11,000 ExxonMobil Stations

Patrick Gauthier, vice president at Amazon Pay, told Karen Webster in an interview that one of the key things that the payment service provides to consumers is a sense of trust and assurance that has been built over the years of checking out on Amazon.com.

“The Amazon Pay button means: ‘You are protected against fraud and malfeasance, just like you are on Amazon,’” Gauthier said. “We use the same tools, and we also export the guarantees.”

PYMNTS research has found that 68% of millennials and 63% of Gen X consumers say reviews, recommendations and familiar checkout options give them confidence that a merchant they’ve never shopped with before is worth buying from.

Related: Amazon Pay’s Gauthier: No One Can Predict Retail’s Future, So Innovate Around What Won’t Change

Moving Into Stores

Amazon has also been integrating its payment service into physical locations with its Amazon One pay-by-palm technology, launched in September 2020. The tech is currently available in at least 50 locations, including some Whole Foods stores, with Amazon saying earlier this year it has “thousands” of customers enrolled.

Still, a promotion earlier this year that offered shoppers a $10 credit if they start using the palm-scanning payments method suggests that people may not be itching to use Amazon One. The biggest obstacle, perhaps, is privacy, with a large cohort of consumers wary about handing over biometric data to big companies such as Amazon.

Related news: US Senators Press Amazon On Palm-Recognition Security

At the same time, though, over one-third of consumers say contactless payment options would encourage them to shop at physical stores, PYMNTS researchers have found, including 38% of Generation Z and 39% of Gen X. And in terms of convenience, Amazon One doesn’t require tapping a phone, pulling out a card or scanning a QR code — just wave your hand and walk on out.

Gauthier told Webster that it’s key for retailers to leverage digital tools and experiences to reduce friction and build trust.

“My encouragement to any retailer is to think of: ‘What are the experiences where digital will create less friction, including omnichannel experiences that can be used throughout the journey of the customer to really reduce the tension and the anxiety and create a safe space?’” he said.




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