Google Pay: Can merchants afford not to get on board?

On 8 January 2018, Google announced it would be enhancing Android Pay and re-naming it Google Pay. What does this mean for consumers? More importantly, how will it benefit merchants at the checkout?

Google Pay’s aim is, first and foremost, to simplify users’ lives by delivering a more streamlined experience. Or, as its lead product manager put it: “With Google Pay, it’ll be easier for you to use the payment information saved to your Google Account, so you can speed through checkout with peace of mind.”

From Android Pay to Google Pay: What has changed?

Despite the rebrand, the objective underpinning Google Pay hasn’t fundamentally changed. Like Android Pay before it, Google Pay is essentially a container that stores consumers’ payment details securely. It then transmits them to a payment processor such as Paysafe via an encrypted envelope when a consumer uses it to pay.

From a merchant standpoint, Google Pay can significantly reduce shopping cart abandonment especially on the mobile web or within an Android native app. With 10 lines of code and a Google Pay button, merchants can be up and running in under a week.

That said, Google Pay differs from its predecessors and also from competitors — in two key ways.

Firstly, Google Pay isn’t tied to a single operating system. Consumers can use it across the web from any device and with any browser and within native Android apps.  About the only place you will not find a GPay button is within an iPhone App.

Secondly, and more significantly, Google Pay removes two crucial friction points from the equation — the need to sign up for an account, and the need to actively upload your payment information. 

Making onboarding invisible

Google Pay’s biggest advantage is that it works with consumers’ existing Google Account credentials.  With one in five people around the world already having a Google Account  — and 61% using Google Chrome as their main web browser— the vast majority of consumers don’t have to sign up to use Google Pay.

Even better, most users tend to be already logged in to their Google Account on whichever device they’re using. And this makes for payments that are faster and more convenient than ever before.

Google Pay’s Head of Business Development Steve Klebe notes: “Users don’t have to stop what they’re doing to log in. Or hunt around for misplaced credentials. Most of the time, they can complete a transaction in as little as two clicks.”

Speed of payment aside, there’s no need to upload financial information, either. Preferred payment details are collected organically over time.

Chrome Autofill automatically asks for permission to save payment details whenever consumers pay online in a Chrome browser. These details are then stored on Google Pay securely and made available for future purchases online and in-store.

Less friction, more action

With this level of ease of use and the sheer number of users already on board, it’s no surprise that more and more consumers are using Google Pay.

Google is serving a captive audience. One that’s already familiar with the brand, trusts it and is comfortable using its services. In turn, merchants who accept Google Pay stand to reap significant benefits.

One of Google’s earliest partners for GPay, hotel booking platform HotelTonight, found that consumers who had Google Pay selected as their preferred payment method were 65% more likely to complete a booking. By contrast, the average hotel website conversion rate is 2.2%.

But, conversions aside, accepting Google Pay can also lead to increased customer acquisition and, more importantly, better customer retention.

Case in point, during the last year, 68% of photography store B&H’s Google Pay transactions were from new users. And 24% of those users went on to create a B&H account.

Similarly, following Google Pay integration, movie ticketing company Fandango saw its in-app orders increase by 30%.

Looking ahead: Are you ready?

There are two billion active Android devices in the world today — more than 75% of devices currently in use. But, more to the point, Google’s widespread availability across platforms means Google Pay could gain significant market share even amongst Apple users.

Google Pay, it seems, has resolved the chicken and egg problem. Google’s user base has already reached critical mass. At the same time, Google services are ubiquitous — most people use one or more of them every day. With that level of comfort, familiarity and trust already in place, it’s not a big leap for consumers to add Google Pay to the growing list of services they use on a daily basis.

Clearly, Google Pay has never been more relevant for merchants. Millions of customers across the globe are all logged in and ready to pay with it. So, the real question is: will merchants pass up this opportunity, or will they catch the wave?

Jeremy Altman, Paysafe’s VP of Strategic Partnerships, comments: “At Paysafe, we’re proud to have been one of the first payment processors to partner with Google and offer Google Pay APIs. Merchants can enable web and app payments with a single API. Plus, there are no transaction fees due to Google and integration is straightforward to complete.”

Want to learn more about how you can leverage Google Pay to get a competitive advantage and make more sales?

Talk to us today.

“At Paysafe, we’re proud to have been one of the first payment processors to partner with Google and offer Google Pay APIs. Merchants can enable web and app payments with a single API. Plus, there are no transaction fees due to Google and integration is straightforward to complete.”

Jeremy Altman, VP of Strategic Partnerships, Paysafe