PayPal Holdings Inc. helped contribute to the cornucopia of checkout buttons available on online sites. Now the company says it’s going to do something to cut down on clutter.
The payments giant announced Thursday that it would be giving online retailers the ability to introduce “smart” payment buttons on their sites, which will dynamically change the buttons to reflect what a user is most likely to pay with. Users who’ve paid with PayPal
or Venmo in the past will see those buttons on a merchant’s site, but users who’ve never explored Venmo won’t see that as a payment option.
“What we learned is that giving too many choices, especially those that aren’t relevant, can actually drive conversion the other way,” PayPal’s chief operating officer Bill Ready told MarketWatch. “If a user shows up and there are 20 different options, that’s going to drive down conversion.”
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Assuming merchants roll out the dynamic buttons, their introduction could increase usage of Pay With Venmo, an option that lets Venmo users shop with their balances or preferred payment methods on e-commerce sites. Pay With Venmo is part of PayPal’s efforts to start monetizing the popular peer-to-peer service, but it’s largely required users thus far to know that PayPal and Venmo are part of the same company.
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PayPal will also introduce buttons for local payment methods, such as Bancontact in Belgium and MyBank in Italy. Previously, users of these local services would see the local option within their PayPal wallets, but the new technology will enable PayPal merchants to render specific buttons for the relevant services depending on where a user was when doing his or her shopping. If the site senses that a shopper is in Belgium, it might show the Belgian local option but not any of the other regional choices. Ready said this will help drive conversion without creating clutter.
According to Ready, PayPal will take into account “a basket of information,” including geography and history of product use, in determining which buttons to show which customers. PayPal won’t expose user data to the merchants, he said.
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The company has explored dynamic buttons in the past through a limited release, but Ready said the company is now “taking it into full view.” Merchants will be able to add a small bit of code to their sites if they wish to use the new buttons.
PayPal shares are up 49% over the past 12 months, while the S&P 500
has gained 11%.