Last month I met with PayPal at the Money 20/20 conference in Las Vegas. First, let me say this is one impressive company. It started in 1998, simply helping people pay for things and get paid. Since, it has become the leader in the rapidly changing and growing FinTech, mobile pay and digital payment space.
PayPal CFO John Rainey told CNBC in an October interview, the e-commerce marketplace today is roughly 10% of the $25 trillion global retail market. He also said the sector is growing at double digit rates and that PayPal continues to grow in excess of that rate. That sounds like a very strong, rapidly growing and quickly changing space.
Digital payments, FinTech, mobile pay, e-commerce, all growing rapidly
With all the new competition, Rainey said PayPal has been growing in the 25% to 30% range by focusing on digital payments. This may have been their best quarter ever, and Rainey said PayPal is looking for more ways to give its consumers more choices.
PayPal sees the online shopping experience from a unique perspective. It looks like wireless innovation in the digital payment space is fueling this growth wave for PayPal and for others in the space. This is a very exciting time as the entire space continues to grow and to change.
PayPal predictions for the 2016 holiday shopping season
PayPal claims 59% of Americans find holiday shopping to be stressful. So much more stressful that they would even rather go to the dentist. That’s what fuels online shopping and days like Cyber Monday.
They also say more shoppers are using their mobile devices to simplify their shopping experience. Shoppers use services like PayPal One Touch, which can be used to purchase items online with just a few clicks on the “Checkout with PayPal” button using their smartphone, tablet or computer.
PayPal says they saw a 56% year-over-year increase in mobile payments this last quarter and expect more during the holiday shopping season.
They also note online shopping is not just for stocking stuffers any longer. They predict the largest holiday transaction on mobile will cost more than $64,000. Hey, just wondering, does Tesla take PayPal? Let me check their site.
How and where customers shop is also changing just like how they pay is changing. According to PayPal, 22% say they will shop on the toilet. That’s right. On the John. And that’s a 7% increase over 2014. I didn’t even know anyone was counting. Nobody asked me.
“Second screen” is also rising. Half of all Americans and even more millennials (59%) plan to holiday shop while binge-watching TV. PayPal predicts consumers will spend more than $141 million on digital music and entertainment subscriptions. You remember the movie “Back to the Future” when Marty McFly was watching countless TV shows at the same time on his big-screen TV, years before there were big-screen TV’s.
In another example of how technology is bursting onto the scene in more ways than we expect, PayPal says don’t be surprised if guests at your holiday table are also shopping on their smartphones to grab a bargain. The company claims 35% say they will do that if they could get a good deal. PayPal said in general, one in five millennials already shop at the dinner table with friends and family.
I’m not sure how I feel about this. If my wife and I spend the day over a hot stove, I want the kids to be there, mind and body. Of course, I can see the benefit as well. While grandma and grandpa may not understand what is happening, the young are really into this new way of celebrating the holiday.
PayPal says peer-to-peer payments like their Venmo are helping to eliminate holiday hassles. Gifting money is also a growing industry segment. They say 35% plan to collect money from friends and family using P2P services. PayPal also said the gift box emoji will be used more than 350,000 times on their Venmo service alone this holiday season.
Charitable giving is also on the rise. PayPal said last year they helped set the Guinness World Record for money raised online for a charity in 24 hours. The company said it raised $45.8 million for charities on #GivingTuesday, more than doubling the previous record, and noted 62% of us plan to make a charitable donation this holiday season. I wonder what they have in store for us this year?
Mobile donations are also rising using in-app donations in the PayPal app, which was launched earlier this year. The company predict a 45% increase in donations using #GivingTuesday on mobile. I hope they are right.
PayPal said young boomers will be the most generous this holiday seasons making the largest donations averaging $416. They also said the generosity of millennials will edge Generation X giving $245 compared to $230.
Mobile growing in importance during holiday shopping season
All that being said, it looks like mobile technology is rapidly growing as a platform not only for messaging, web surfing, app using, money managing and more, but also as a real player in the holiday shopping season. And year after year it seems mobile is growing in importance.
So, mobile is not only saving us time and avoiding crowds by shopping from the comfort of our own toilet seat, but it’s also growing into an easy way to make charitable donations to help the world. So maybe, just maybe the future isn’t so bad after all even if the kids are shopping on their iPhones and Android devices at the Thanksgiving dinner table. Happy Thanksgiving.
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