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PayPal Mobile Payment Trial Tripped Up By Lack Of Training

Written by Evan Schuman
January 23rd, 2013

As retailers struggle with how to get shoppers to try mobile payments, PayPal has been experimenting with different approaches. Last month, for example, PayPal set up a booth at a very large New Jersey mall and offered shoppers $10 to try its mobile payment system. But the trial ran into the same issues that have tripped up so many mobile trials: lack of associate and store manager training; an approach that made it awkward for some shoppers (already rushed during December holiday shopping at an extremely crowded mall) to get the incentive; and no reason for customers to try it again after the promotion.

The trial at the 2.1 million square foot Garden State Plaza (about 300 stores) involved six chains and managers at each of the stores discussed the trial, on the condition of anonymity. The chains involved were American Eagle Outfitters, Jamba Juice, Nine West, Champs, Aerie and Foot Action (part of the FootLocker chain). On the plus side, all of the stores reported that some shoppers tried using the app. On the down side, far from all of them were able to do so.

PayPal is arguably getting the most traction from its mobile payment efforts and certainly has the largest footprint among major chains. Google Wallet, after a promising launch, has slowed way down. ISIS was late in launching its only trial and its retail partners are small. And MCX is still a year or two away from any serious usage.

But PayPal is still running into the challenges of any new technology, mostly getting shoppers to change their behavior.

The trial ran into a practical problem, as one booth was set up in the middle of the very-spread-out mall, with no physical presence in any of the participating stores. The process involved shoppers leaving the booth, going to a participating store and then having to come back to the booth to get their $10. The stores that were farther away from the booth suffered the most, but the question remained why a presence in the stores wasn’t attempted.

That way, people who already wanted to shop at, for example, Jamba Juice, could be given the incentive in the store. They could then get the incentive without having to walk all the way back. Then again, that could be part of the test, to see how much shoppers would go through to get $10. A marketer might want to know if anyone opted to go to one of these stores solely because of the mobile trial.

There was also some question about the nature of the incentive, but PayPal seemed to get that one right (other than the incentive being a lot smaller than it needed to be). One store manager said his shoppers would have been much more motivated had it been a percentage off, rather than a static $10. Given that it was a PayPal—rather than a retailer—trial, PayPal couldn’t have guaranteed to pay the shopper a specific percent of whatever they chose to buy. It was unlikely that PayPal was getting a percentage of any trial-fueled purchases (beyond the usual PayPal fee).

One shopper who participated in the trial said the lack of restrictions on the incentive were baffling, as someone at the booth suggested buying shoelaces for $2 and then profiting $8. But that’s not a hole in the system. The $10 was to get people to use the mobile app and, if they did, PayPal should have cared what was purchased. (From a bigger picture perspective, it would have been nicer if shoppers made large purchases, because that would have given PayPal more evidence to convince other retailers to join.)

One store manager said his store saw a lot of customers using the mobile app, but stressed that his store was right near the PayPal booth. “It was a one-minute walk,” the manager said.

The promotion only lasted through Christmas Eve. When asked how many shoppers had used the PayPal app after the promotion ended, he said, “Not that many. Hardly any.”

The biggest consistent point for many of the managers was a lack of understanding of how the PayPal mobile app worked. That meant that when customers had questions, they couldn’t help.


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2 Comments | Read PayPal Mobile Payment Trial Tripped Up By Lack Of Training

  1. Gerard Says:

    Why did PayPal need a physical booth at the mall for mobile payments? Mobile payments are not supposed to require live agent assistance. I don’t understand what the kiosk was doing with users walking back and forth

  2. ed Says:

    “But they were having a lot of difficulty with it, so they all just paid” with cash or Visa or MasterCard.”

    This statement is the #1 reason mobile payment implementation in the USA is a cognitive dissonance tragic comedy and in some ways, discriminatory.

    Worldwide case studies of mobile commerce success demonstrate the target audience are primarily unbanked and/or live in high density areas. Research shows the average m-commerce consumer will spend 80 of their money in less than a 3 mile radius of small purchases under $25. Narobi, Kenya – Lagos, Nigeria – Seoul, Korea – Tokyo, Japan – London, UK – all are high density urban zones where m-commerce thrives.

    But here in the USA for some strange reason, these “mobile experts” are targeting highly banked suburbanites and then I see statements like:

    “But they were having a lot of difficulty with it, so they all just paid” with cash or Visa or MasterCard.”

    yeah, ok…..

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