Remember when Google launched Froogle? Stockholders kept an eye on Google shares in anticipation of the company’s clean sweep over eBay as the Froogle checkout system gave PayPal a run for its money. It’s almost like they expected the product to be so revolutionary that the e-commerce market would implode instantly upon launch. Five years later, Google has dumped the Froogle name for the less whimsical “Google Product Search“ title, and eBay and PayPal have held their ground.
After reading Pro PayPal E-Commerce by Damon Williams, manager of PayPal’s Developer Program, I see clearly how PayPal has remained vital. While Google sticks with its clean and minimal approach to business, PayPal has proven that, when it comes to merchant services, developer tools are the trick.
According to a conversation with Williams, “PayPal’s developer community is a key factor in the growth of our off-eBay business. We not only give developers the technical tools they need to successfully integrate PayPal payments, but we also educate them on the business benefits that PayPal provides so that they know why it’s a great idea to build PayPal into any e-commerce website.”
PayPal has also partnered with various software providers to help out its small- and mid-sized-business customers. Transactions can be automatically fed through products like Microsoft’s Office Accounting, Intuit’s Quickbooks, and Blinksale. PayPal’s customer-friendly way of doing business has also made online commerce painless for businesses like Harrods, DHL, Pixmania, Meetic, and Boots Retail, and has led to an international expansion that has 35 million European customers.
During round two of the fight between Google and Yahoo!, PayPal stepped into Yahoo!’s corner to help the yodeling titan launch a product to rival Google’s checkout system. Merchants that offer transactions through Yahoo! Checkout get discounts on their Yahoo! Search Marketing costs and free payment processing services from PayPal through the end of the year. The deal places Yahoo! on even ground with its competition while allowing PayPal to add to the already 1.3 million transactions it processes each day. Cha-ching!
For Google to dominate the online transaction market, it may need to look into switching to a customer-focused development team that can deliver widget-styled tools, especially tools that don’t require users to be advertising clients. For now, PayPal still leads the pack. Its partnership with Yahoo! adds to the list of reasons merchants would pass on Google’s online e-commerce offering.
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