Pay with Amazon from Your Mobile Phone?

Posted Tuesday, October 29, 2013 in Online, Mobile & IT by Patricia Seybold

Sometimes when my spider-sense tingles, it’s hard to back it up with concrete evidence. So I may be going out on a limb this week by suggesting that Amazon’s rebranded payment service (yawn) “Pay with Amazon” could become a major player in mobile commerce.

Pay with Amazon logoWhy do I think that this seemingly innocuous announcement, which took place at a payment systems conference, Money 2020, on October 8th, 2013, is an important 3D chess move by Master Bezos? First, I’m not the only one who found this announcement significant. Nigel Powell of RedFerret fame blogged that Pay with Amazon “will completely change the face of online retail.” But I’m sticking my neck out a bit further (with no real evidence) to say that I believe that Pay with Amazon is coming soon to your mobile phone.

What I like about the idea of using Pay with Amazon on my phone to pay for things I buy is that it leverages the investment I’ve already made in entering all my credit cards and payment info and account information into Amazon—a trusted shopping partner I’ve been using for years. And I won’t have to worry about the fact that, if I lose my phone, someone can gain access to my money or my credit cards. They remain securely locked away in Amazonland.

Why am I highly likely to be completely wrong with my prediction (although I rarely am)? Because in order for Amazon to be really successful as a payment partner on my mobile phone, it would need to be easy for physical retailers to be happy to accept those payments. There’s the rub. Large big-box retailers like Target and Wal*Mart aren’t going to want to accept payments from Amazon. Independent bookstores also won’t want to have anything to do with Amazon. On the other hand, millions of local merchants would no doubt be delighted to have an easy way to accept payments through Amazon as long as the transaction fees are competitive. Amazon provides good fraud protection, good customer service, Pay with Amazon is likely to promote more impulse buying, and it ties in well with Amazon Local.

But, even if small retailers were happy to accept Amazon payments, HOW would they do it? What modifications would need to be made to their Point of Sale systems? How easy would it be to request, accept, and acknowledge electronic payments from Amazon via a mobile phone? And, judging from the discussions taking place on the developers’ forum on the Amazon Payments site, it doesn’t appear that Amazon is currently doing a good job of supporting developers who are trying to integrate its payment services into their offerings.

So there are plenty of unknowns. That’s why this is a pretty shaky assertion I’m making. But what intrigues me is the logic of it. We all think that Amazon is planning to roll out its own mobile phone next year. (It’s obviously too late for this year.) Certainly such a phone would have Pay with Amazon integrated into it—ideally for purchasing physical and digital goods from anyone, not just from Amazon. But how to build enough traction for competing retailers to be willing to accept Amazon Payments? Why not start by becoming one of consumers’ preferred payment providers on as many mobile phones as possible? Then, when Amazon launches its branded Kindle phone with tight integration to Amazon goodies, it won’t be a walled garden, but an extensible platform.

Here's my review on this:

Why “Pay with Amazon” Is a Big Deal
How Amazon’s Payment Services Will Impact Mobile E-Wallets
By Patricia B. Seybold, CEO and Sr. Consultant, Patricia Seybold Group, October 25, 2013

(Read the short sample and download the full article in PDF.)



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