Google Checkout

Thursday, June 29, 2006 | 06:45 AM

Google_checkout The initial reports were wrong. The new service is not, as was previously stated, G-Buy or Google Wallet, but Google Checkout.

And the goal seems to be less of creating a direct competitor to PayPal than another way to generate targeted advertising search revenue, and improve the data and specificity of targeted search results. The San Jose Mercury News reports:

"If Google Checkout is successful, the company could reap big rewards. The transaction data for each person who makes a purchase, combined with their search history, could lead to advertising that takes into account their favorite stores and preferred brands. The more targeted the advertising, the more advertisers are willing to pay."

Since Google will waive the transaction fees for vendors who buy AdWords, the goal may simply be to create more search advertising. If Paypal gets dinged in the process, they are collateral damage.
>

Google_650

Google2_650

>
Her's the cost structure: Sellers pay Google 2% of each transaction, plus a 20-cent fee. That's less than what they would pay MasterCard or Visa, who charge 1.95% plus 30 cents per transaction. PayPal charges a 2.9% plus a 30-cent fee (but Paypal's fees decrease when merchants sell over $3,000).

Google appears to be subsidizing transactions. The reason is ad sales: For every $1 in fees a company spends on search advertising, they will waive fees on $10 worth of purchases. That is about a 20% rebate on advertising spending.

As we noted previously, this is likely to inure to the benefit of consumers.

BusinessWeek reports

"this battle is bound to benefit consumers and merchants. By providing new and cheaper alternatives to credit cards for buying items online, these and other new online payment services could give buyers more confidence in a wider range of e-commerce sites. And coupled with e-commerce services from eBay, Google, Amazon.com, and others, they're likely to help smaller merchants who can't afford a credit-card merchant account to compete with bigger players."

>

There is a short video tour of Google Checkout at the demo sit (halfway down the page).

click for video

Gc





Sources:
Google Aims to Speed the Online Checkout Line
SAUL HANSELL
NYTimes, June 29, 2006
http://www.nytimes.com/2006/06/29/technology/29google.html

Google launches Checkout service to compete with PayPal
Elise Ackerman
Mercury News, Wed, Jun. 28, 2006
http://www.mercurynews.com/mld/mercurynews/business/14926295.htm

Google's eBay Challenge
Robert Hof
Businessweek, JUNE 28, 2006
http://www.businessweek.com/investor/content/jun2006/pi20060628_081708.htm

Thursday, June 29, 2006 | 06:45 AM | Permalink | Comments (9) | TrackBack (0)
de.li.cious add to de.li.cious | digg digg this! | technorati add to technorati | email email this post

bn-image

TrackBack

TrackBack URL for this entry:
https://www.typepad.com/services/trackback/6a00d8341c52a953ef00d8349d0a6453ef

Listed below are links to weblogs that reference Google Checkout:

Comments

is EBAY ok then????

What about PALM today?

Do people like the new TREO??

Gotta get back to formulating my inflation expectation

Posted by: SINGER | Jun 29, 2006 7:58:43 AM

The comments to this entry are closed.



Recent Posts

December 2008
Sun Mon Tue Wed Thu Fri Sat
  1 2 3 4 5 6
7 8 9 10 11 12 13
14 15 16 17 18 19 20
21 22 23 24 25 26 27
28 29 30 31      

Archives

Complete Archives List

Blogroll

Blogroll

Category Cloud

On the Nightstand

On the Nightstand

 Subscribe in a reader

Get The Big Picture!
Enter your email address:


Read our privacy policy

Essays & Effluvia

The Apprenticed Investor

Apprenticed Investor

About Me

About Me
email me

Favorite Posts

Tools and Feeds

AddThis Social Bookmark Button

Add to Google Reader or Homepage

Subscribe to The Big Picture

Powered by FeedBurner

Add to Technorati Favorites

FeedBurner


My Wishlist

Worth Perusing

Worth Perusing

mp3s Spinning

MP3s Spinning

My Photo

Disclaimer

Disclaimer

Odds & Ends

Site by Moxie Design Studios™

FeedBurner