Dive Brief:
- PayPal, which has expanded its cashback rewards program to boost customers’ in-store use, has observed an increase in rewards claimed for groceries and gas since the program’s expansion late last month, the company’s CEO, Alex Chriss, said during an investor conference last week.
- The digital payments pioneer also rolled out a new advertising campaign this week pitching the cashback offer, with comedian actor Will Ferrell using his phone to pay for goods and services anywhere and featuring Fleetwood Mac’s song “Everywhere.”
- The San Jose, California-based company is also seeking to increase consumer use of its peer-to-peer payment tool Venmo for in-person purchases by pushing a debit card tied to the accounts and pitching it as a way to pay local contractors like dog-walkers and babysitters, Chriss said during the presentation.
Dive Insight:
Chriss, who has been in the company’s top post for about a year, called the past 12 months a “fun grind” during his conversation with an analyst at the Goldman Sachs’s Communacopia + Technology Conference last Monday. Since he was hired as CEO, Chriss has overhauled the management team, revamped the company’s organization and remade its business strategy.
The CEO's feedback on progress so far show the "potential for both stronger in-store volume and habitual usage," RBC Capital Markets analyst Daniel Perlin said in a note to investors last Tuesday.
The cashback reward program is aimed at prompting consumers to use PayPal for purchases other than those made online, to expand the company’s reach to more settings. Using PayPal to pay for gas and groceries is a departure from its typical past online use cases.
“It’s an expansion of the daily use habituation that we want people to start to think about when they think about PayPal,” Chriss said at the conference.
The new PayPal Everywhere advertising campaign features Ferrell reveling in the chance to use PayPal to make payments anywhere, from lemonade stands to at a high-end boutique’s point of sale.
The company is offering up to 5% cashback, in certain circumstances, when consumers use PayPal’s Mastercard debit card. The program can be tapped either through PayPal’s app or with a classic card.
The company is also seeking to prod consumers to see Venmo as a payments tool in an effort so it can better monetize that business, Chriss said. In addition to more deeply integrating a debit card into the Venmo app, the company is making that payment tool more generally available online, he added.
The CEO also noted that part of making PayPal more widely available includes its current partnering with Apple and Google to make PayPal’s tools available in those digital wallets. Apple was pressured this year in Europe to allow third-party developers to work within its near-field communication payment technology.
PayPal also plans to use that NFC contactless technology to make its payments services available in an “omnichannel” way, Chriss said.
“We'll start with one country in Europe, likely this fall, and then continue to expand over time, and if it happens to work in in the US, we'll do that,” he said.
