PayPal is pressing forward with its offline strategy, giving retailers another way to tie together e-commerce and retail payments. The company announced a new partnership with VeriFone Systems Inc. and Equinox today. The deal includes a comprehensive licensing, marketing and implementation agreement that advances PayPal acceptance at large retailers nationwide, said Don Kingsborough, VP of retail and prepaid services at PayPal.
PayPal entered into a similar agreement in January with POS manufacturer Ingenico.
"PayPal's vision for the future of shopping includes people making purchases anytime, anywhere and over any device," Kingsborough said in a press release. Deals with POS makers are helping PayPal realize the company vision of putting its payment method in stores and at the point of sale, he said.
With VeriFone's customer base encompassing 80 percent of the top 200 largest retailers in the U.S., the agreement gives PayPal access to more than 1 million high-volume points of sale. As participating retailers take advantage of VeriFone's software upgrade and services, shoppers will use the existing spectrum of PayPal payment methods at checkout, including using a PayPal Access card and PIN or entering a phone number and PIN. The VeriFone solution is future-proof so that adding new options, such as NFC, will be easy to implement when they become available.
"VeriFone's extensive customer base and strong technology make it a natural ally for PayPal as we continue to deliver on our strategy to bring intelligent electronic payments and value-added offers to brick-and-mortar stores," Kingsborough said.
Hoping to spur consumer demand for the new payment experience, VeriFone will layer PayPal's "digital wallet" interfaces and user experience at select U.S. merchant locations alongside traditional payment forms. Long-term, however, VeriFone will allow PayPal acceptance natively as part of new services and solution packages offered to its retail customer base.
Merchants sign up
In a post on the company's blog (and at a press event earlier today) PayPal named 15 merchants who will accept PayPal as a payment method at the point of sale. The company had been piloting the program at Home Depot stores nationwide.
Joining Home Depot in accepting PayPal are Abercrombie & Fitch, Advance Auto Parts, Aéropostale, American Eagle Outfitters, Barnes & Noble, Foot Locker, Guitar Center, Jamba Juice, JC Penney, Jos. A. Bank Clothiers, Nine West, Office Depot, Rooms To Go, Tiger Direct and Toys"R"Us.
New company president David Marcus said the company's efforts demonstrate how easy it is for innovative retailers to improve the shopping experience, extend loyalty programs and better engage with their customers.
"With PayPal, retailers don't need to rip and replace, install NFC or conduct a massive upgrade to bring innovation to their customers," Marcus said in a blog post. "PayPal works seamlessly with a retailer's existing point of sale hardware. This simple integration allows consumers to pay quickly, easily and securely."
Marcus said the company has made deals with POS makers targeting smaller retailers as well, companies like Leapset, ShopKeep, Vend and Erply.
"These companies already work with 50,000 mid-market businesses offline," Marcus said. "With the flip of a switch, their merchants could use PayPal in their stores without ripping out and replacing their existing systems and investing in new or expensive upgrades."
And according to Marcus, new ways for consumers to pay are only part of what PayPal hopes to offer.
"We're helping merchants connect with consumers at every stage in the shopping cycle," Marcus said. "Before they come into the store, while they're in the store, or even after they've left. We're able to drive consumers through a retailer's doors with relevant offers, coupons and discounts, then maintain a relationship with that consumer that keeps bringing them back to the retailer, in store or online."
For more stories like this, visit the payments research center.
Cherryh Butler contributed to this article.