Amazon is launching a PayPal-like service, hoping to greatly expand its Amazon Payments program. Dubbed the Amazon Payments Partner Program, it is being made available to merchants in the U.S., U.K., Germany and Japan.
With 304 million customers, Amazon brings an enormous base of signed-up, ready-to-pay consumers to merchants who join the program. Like PayPal, it eliminates the need for consumers to set up an account with each merchant, potentially providing better security and fewer hassles.
It also brings Amazon's popular one-click ordering system to thousands of new merchants, notes Tom Caporaso, CEO of Clarus Commerce, an e-commerce solutions provider which owns FreeShipping.com.
"Amazon is perhaps the most trusted retailer in the U.S. The certification process will help spread that trust to participating merchants, which is very valuable, especially for smaller retailers," Caporaso said in an email to ConsumerAffairs. "They’ll also benefit from the one-click payment process, which offers speed and convenience to customers — yet another benefit of shopping with Amazon, even when people aren’t shopping at Amazon.com."
No cost to consumers
There is no cost to consumers for using the service. Merchants pay 2.9% plus 30 cents per transaction, which is similar to PayPal's charges.
Besides offering the program to merchants, Amazon is proposing to integrate it into existing "storefront" programs that retailers use to manage their online businesses. One of the more popular storefront programs, Shopify, provides online services for 243,000 merchants, all of whom will have the option to include Amazon Payments on their sites.
“Our merchants want to offer their customers a payment solution that is trusted, easy and familiar,” said Brennan Loh, Director of Business Development at Shopify. “We’re excited to be a Premier Partner in the Amazon Payments Partner Program, enabling our merchants to offer Pay with Amazon."
Besides its immediate benefits, the Global Partner Service will help Amazon expand its grip on the e-commerce marketplace.
"Amazon will ... be able to collect and analyze even more data on its customers, which will help it further tailor offers and services to individual customers and larger demographic groups. Customization is a key step in building loyalty," Caporaso said. "This is further proof that Amazon doesn’t just want to be the 'Everything Store;' it wants to be the 'Everything Business.'”
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