Google Checkout and Amazon

My take on the newly launched Google Checkout, the company’s payment service:

  • Contrary to all the pre-launch chatter, it isn’t really a direct threat to Paypal/Ebay. It is more of a merchant service than a replacement for one-off person-to-person payments
  • It is, however, a potential problem for Amazon. Looking at my own behavior, the main reason I buy from Amazon is that I trust it (mostly), and that it has my credit card information already. I trust Google about as much as I trust Amazon, so if I have credit/delivery info stored at Google and can make a purchase cleanly through a Google Checkout-affiliated non-Amazon merchant then I’m happy to do it.
  • Unlike almost all of Google’s recent errant launches, this one does lever the company’s core ad business. Why they spend so much time on nonsense like Google Spreadsheets, and don’t launch things like this soooner, I have no idea.

Related posts:

  1. Amazon Layoff Watch
  2. Amazon: I Was There
  3. Amazon Renovated URLs?
  4. Google Sez PayPal is Safe. It Isn’t.
  5. Why No Live Amazon Associates Data?

Comments

  1. a says:

    I don’t buy from amazon because I trust their payment system. I buy from amazon because I trust them to ship what i ordered and take it back if there is a problem. google’s trustworthiness doesn’t make me trust other vendors.

  2. Agreed, and I don’t think I’d broaden my buying to just anyone. But there is a broad group of merchants — BN.com, Buy.com, etc. etc. — that I rarely buy from, and that have good return/ship policies, mostly because I couldn’t be bothered inserting payment info.

  3. Bruce Boston says:

    “Contrary to all the pre-launch chatter, it isn’t really a direct threat to Paypal/Ebay. It is more of a merchant service than a replacement for one-off person-to-person payments”
    I think this statement presupposes that Paypal makes the majority of their revenue from P2P payments and not merchant services….before we conclude that GCO is or isn’t a threat to Paypal, has anyone verified the validity of that assumption?
    -bruce

  4. Franklin Stubbs says:

    Could the combination of Adsense and Checkout lead to a functional pay-per-sale model? Now that would be interesting…
    Also, re Paypal, doesn’t every paypal merchant have an incentive to give Checkout a shot, risk free? And if Checkout delivers the good, wouldn’t they have an incentive to favor Checkout thanks to significantly lower charges?
    I seriously doubt Meg Whitman is breathing a sigh of relief right about now…

  5. Good question, Bruce. I know that used to be the case, but I don’t have current data.
    Franklin: I don’t doubt that Whitman is still rightly nervous, but the near-term impact on Paypal shouldn’t be nearly as dire as predicted in some quarters.

  6. PaulSweeney says:

    Given that Google is about better search, would google be in a position to gather better data on our credit worthiness, and make offers based on now just browse, but browse to buy behaviours? by category? I can’t tell you how many shopping carts I’ve left in bargain book sites because the shipping just wasn’t attractive. If those shopping cart environments “could tell” that hey this is one hell of a book buyer, then “the cart” could enhance the offer, based on actual buying behaviour recorded by Google. Just a thought.

  7. PaulSweeney says:

    Just seen this blog: much more comprehensive than my poor effort:
    http://blogs.forrester.com/charleneli/

  8. Rocky says:

    Aside from form fill, I’m not seeing the user value here. If I have a problem with a merchant, who would I rather call AMEX (or Citibank or MBNA) or Google? AMEX has always been good to me about handling disputes. I wouldn’t have that same level of trust with Google.
    The value of Paypal is that it lets me securely pay individuals who don’t take credit cards.
    When I buy on eBay and the merchant gives me a choice of Paypal or AMEX (or VISA or MC), I always go with AMEX.

  9. Steve says:

    have you noticed the trend? everything that Google does is hyped so much and predicted to be a killer of this and that. In reality, it turns out that Google mostly fails to gain ground in everything they do except for search. It’s a one trick company.
    The outcome of this will be that PayPal will become even better and Yahoo and probably MSN will try to follow Google and incorporate payments into thier search. Yahoo already signed up with PayPal and I doubt that MSN will try to develop payment system (they are much more likely to use dominant PayPal). In terms of market share, Yahoo search + MSN search is just a little bit under Google. But if Yahoo incorporates PayPal into their search, I see this as a very good reason for millions of loyal PayPal users give preference to Yahoo search. I will defenetly switch back to Yahoo search from Google if I can see there who accepts PayPal.
    As for me, I checked out Google checkout and since I am a rather heavy PayPal user, I absolutely see nothing atractive about Google payments. PayPal is incomparably more complete solution and is accepted at over 150K merchants off ebay and several millions on ebay. Google has what? mere 100.

  10. John K says:

    I disagree with the PK CW here.
    GCheckout is a huge problem for eBay. Especially when combined with all of eBay’s other huge problems.
    Let’s see, GCheckout offers:
    - central pay system for 50% of the internet
    - lower cost for sellers
    - history + privacy + insurance for consumer
    - integrated with dominant ad system
    - includes coupon codes!
    - price incentives for big AdWords users
    That’s all great for rapid uptake. But the big secret feature that will really hurt eBay will be Google’s ability to build a portable reputation system around this. They should have the best trust/reputation system for shopping, and it’s gonna be global across the internet.
    That goes to the heart of eBay’s value. Google is cutting a ton of margin out of eBay’s heart right now, and they’ll take away the one thing eBay had done well in it’s walled garden and democratize it.
    So now that the glue piece is actually here, does Base, Froogle and Co-op start to make sense? Yes those are still primitive but they are all a set up for a very dominant sibling to Google’s one-trick pony.

  11. Franklin Stubbs says:

    As for me, I checked out Google checkout and since I am a rather heavy PayPal user, I absolutely see nothing atractive about Google payments. PayPal is incomparably more complete solution and is accepted at over 150K merchants off ebay and several millions on ebay. Google has what? mere 100.
    Are you on crack? The service just launched. What is with this goofball hatred of Google? Are you a Paypal employee? Note: I have no affiliation with Google and don’t own Google stock. I’m just surprised and curious at the “trend” of intensely short-sighted reaction. The NYT seeks to paint Google as a high tech version of the NSA stalking your privacy. ZDNet is on this weird crusade to make Google ‘predatory’ that is totally out of left field. Where are these utterly hostile and utterly irrational reactions coming from? Why not step back, see what happens, and observe whether the product succeeds or fails?

  12. The_Lex says:

    The “just entering into the market and no one else uses it” isn’t necessarily a valid argument for not switching over. Sure, it does in the short sight, but if it’s good enough, plenty of people will switch over.
    I amde the same argument about Mozilla Firefox when I first heard about it. Now, I use it all the time and only use IE Expolorer when the page looks noticeably off or something. Otherwise, thought, Firefox is, by far, safer and faster to use, so I use it all the time.

  13. I should think price and availability are a big factor in online shopping. That is why I often shop Buy.com and BN. If Amazon is cheaper, I shop there – but never just because they have my credit card info.
    – Faisal Laljee