With Honey Deal, PayPal Joins Customer Journey Sooner
With Honey Deal, PayPal Joins Customer Journey Sooner by Christine Love
Online and mobile payments platform PayPal has taken what many observers might consider a bold move by spending $4bn on the company behind Honey, a deal-finding Chrome extension that debuted sometime around 2012.
The purchase seems to suggest that PayPal wants to expand beyond its core payment business, a plan hinted at by a recent conference call involving the company that described the Honey deal as a “springboard” for future commercial endeavors.
Much like many of the world’s greatest inventions, Honey had its inception in a desperate bid to buy a less expensive pizza. Creator and entrepreneur Ryan Hudson was unable to find a coupon online to get money off a takeaway and so threw together a prototype of the Honey browser app one evening. With the help of co-founder George Ruan, Honey would eventually become one of the most popular deal-finding tools available online and a darling sponsor of many YouTube channels.
But why Honey? And what does the move mean for PayPal’s future mission? It’s possible to answer both questions by considering where in the customer journey PayPal joins the transaction – the very end. The acquisition of Honey, which is usually accessed by consumers much earlier in their shopping experience, means that PayPal bookends the entire purchasing process, making the company something of a shopping companion rather than a mere payment option.
In its recent press release, PayPal wrote that Honey would increase “sales and customer engagement for its merchants.” It’s likely then that PayPal merchants will soon be able to become preferred deal providers in much the same way that PayPal owners eBay offer the Top Sellers badge to long-serving and especially lucrative stores. PayPal imagines playing a “more meaningful” role in customers’ lives – even despite the vast reach it already has.
It’ll be no surprise to web users that PayPal is one of the most popular payment methods in the world, and has even recently begun to break into niches that had previously focused on more traditional plastic options, like the gaming industry. In addition to other payment options, an online casino platform like NetBet, for instance, utilizes PayPal’s billing agreement feature to provide instant processing of deposits, without the requirement for repeated logins over different play sessions. Much the same applies to popular MMO Runescape as well as other titles across the video gaming spectrum.
It’s debatable whether PayPal’s recent interest in social commerce, i.e. items sold through businesses on social networks, has anything to do with the acquisition of Honey. However, the company expects social purchasing to double in overall value before mid-2020. The idea does align with PayPal’s desire to capture consumers’ attention in the places they go for inspiration (e.g. Facebook, Pinterest), to paraphrase senior director Nicola Longfield.
Being able to stimulate the appetite for shopping and direct the customer through to a completed purchase would be a powerful e-commerce tool indeed. After all, the ultimate beneficiary is likely to be the consumer. As we very well know, there isn’t a person on earth who would turn down a tool that finds them $1 off an emergency pizza.