By Alistair Barr
SAN FRANCISCO May 21 PayPal, the online payment
operation owned by eBay Inc, will increase marketing
spending to support its push into physical stores, President
David Marcus said on Tuesday.
"You'll start seeing us amping marketing up later this
year," Marcus said in an interview with Reuters.
PayPal is trying to become a common way of paying in
physical stores, a much larger market than its online roots. The
company expects to be in 2 million merchant locations by the end
of 2013 and it is working on ways to persuade consumers to use
PayPal rather than their usual credit and debit cards.
Customers would use PayPal via smartphone app. In addition,
shoppers at the checkout counter can use PayPal by typing in a
mobile phone number and a four-digit PIN that has to be set up
online beforehand into the merchant's system. They can also use
a PayPal card that links to their account.
"Swiping a card in a store is not hard," Marcus said during
a meeting earlier on Tuesday with reporters at PayPal's
headquarters in San Jose, California. "We really have to bring a
lot of value to consumers to change that behavior."
Marketing will be a big part of this push. PayPal has
already run several online video ads starring movie actor Jeff
Goldblum to promote its payment service.
EBay ran a big TV ad campaign in 2011 which helped revive
its online marketplace. EBay waited to fix consumer problems
with the marketplace before it spent heavily on such marketing
and PayPal's Marcus is taking a similar approach now with the
expansion into stores.
"We want to make sure we have enough density of consumer
experiences before we do a lot of marketing," Marcus explained.
"We have really only one chance at this and we do not want to
PayPal has been testing a way for customers of smoothie
store Jamba Juice to order ahead using PayPal's
smartphone application and pick up their drinks at a separate
PayPal has been testing this at seven Jamba stores in the
San Francisco Bay area but will roll it out at more Jamba stores
across the United States. It expects to announce similar
line-skipping deals with other companies soon, Marcus said.
Also on Tuesday, Marcus announced a new partnership with
RadioShack Corp that will introduce PayPal into all of
the electronics retailer's stores starting this month.