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EBay expects $8B in mobile commerce, $7B in mobile payments this year

January 13, 2012


EBay predicts significant increase in mobile shopping for 2012

This could be a mobile-tastic year for eBay, with the company predicting it will do $8 billion in mobile gross merchandise volume and $7 billion in mobile total payment volume in 2012.

The numbers, which come from a speech made by eBay CEO John Donahoe at the CES conference in Las Vegas this week, are up significantly from last year and point to the growing role that mobile is playing for eBay. The company also announced that PayPal exceeded expectations for 2011, reaching $4 billion in mobile payment volume and that EBay saw $5 billion in mobile gross merchandise volume.

“Consumers are using their mobile phones more and more to shop anytime and anywhere,” said Amanda Pires, senior director of global communications and experiential marketing for PayPal, San Jose, CA.

“Consumers are increasingly choosing eBay mobile and PayPal mobile because we provide a great shopping experience and a fast, highly secure way to pay,” she said. “With millions of customers globally, the brands are already trusted online so it makes sense consumers would chose eBay and PayPal on their mobile phones.

“We’re seeing many of our retail customers offer shopping experiences optimized for the mobile phone. And we expect that trend to continue.”

Mobile purchasers grow
The numbers point to the significant growth in mobile commerce and payments over the past year.

At the beginning of last year, eBay predicted total mobile payment volume would reach $1.5 billion but updated that figure several tiimes throughout the year as growth accelerated. In 2010, PayPal’s total mobile payment volume was $750 million.

The news follows the recent departure of PayPal president Scott Thompson, who jumped ship to become the new CEO at Yahoo.

The growth in mobile payment transaction volume is being driven by the success of PayPal’s mobile-optimized checkout flows and the rapid increase in consumer adoption of mobile shopping, according to the company.

PayPal currently has more than 17 million customers regularly making a purchase through their mobile phone, up from the eight million it reported in June.

PayPal continues to work with a number of retailers to deliver mobile shopping experiences for consumers to enable shoppers to scan their phone at the register or to pay on their phone. Some of the retailers it is working with include Starbucks, Pizza Express, Yorder and Fandango.

EBay has been building a multifaceted retail technology solution to help retailers address the pain points in their businesses, with mobile playing a large role.

PayPal is testing an NFC mobile payments application at two stores in Sweden as it continues to look for ways to expand access to its payments services.

PayPal has been experimenting with NFC for a while and recently incorporated NFC into the latest version of its Android app to enable peer-to-peer payments with two mobile phone users tapping their phones together to transfer money between them.

PayPal is also working on mobile deals using technology offering from eBay’s acquisition of Where earlier this year. The technology is being integrated into PayPal’s core technology to enable more targeted deals to be delivered to consumers.

“It is thrilling,” said Stephen Burke, vice president of the mobile practice at Resource Interactive, Columbus, OH. “It is validation of the deep level of penetration in the United States market that eludes most forecasters and analysts.

“It also underscores eBay’s ability to tightly integrate discovery with payment,” he said. “This is not something others cannot do – they already extract payment from consumers in a variety of ways and they just have to figure out how to integrate mobile more tightly.

“I think you will see a number from Amazon that is going to be in the same range. Add that to all the people in the middle and we are going to be around $15 billion in mobile commerce this year, which is  bigger than Japan.”

Final Take
Chantal Tode is assoc. editor on Mobile Commerce Daily, New York

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