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Looking to attract more small businesses that just want to process online payments, e-commerce kingpin Amazon.com Inc. is rolling out a new, streamlined version of its 6-year-old Amazon Payments service.
The new platform, which includes a simplified application programming interface, front-end widgets, and a testing “sandbox,” minimizes integration time by stripping away payments-related features available with the regular Amazon Payments product, says Tom Taylor, vice president of seller services for the Seattle-based company. These important but non-core functions, summed up as “order management,” include pricing, shipping, and inventory-control integrations. With the new version, “all we’re doing is processing payment,” Taylor tells Digital Transactions News.
The older Amazon Payments platform, including order management, is still available. “We’re just releasing a new option,” he says. Integration time for the new platform, he adds, depends on how complicated the merchant’s site is, and how many sites it operates. “It could be as short as a day,” he says.
What is not new is that the streamlined service relies on payment credentials, shipping addresses, and other information Amazon has stored on its servers for some 215 million customers to reduce payment to three clicks on a PC keyboard or mobile device. Pricing for all Amazon Payments services except the Flexible Payments platform (which has its own pricing schedule) starts at 2.9% plus 30 cents and descends from there as volume builds, bottoming out at 1.9% plus 30 cents, in line with fees from other processors such as PayPal Inc.
Amazon will not disclose how many online merchants use Amazon Payments, nor will it say how many have already signed up for the new platform, which went live commercially mid-summer. “We went out with a beta a few months ago with a few sellers and got a good response, so we opened the doors a few weeks ago,” Taylor says.
The company did pass on to Digital Transactions News the names of some client merchants, along with comments. SewingMachinePlus, for example, told Amazon that the service quickly became the preferred method of payment on its site, though it isn’t the only wallet-based method. Visual Apex, which sells home-theater gear, said half of its orders are now on the platform. The Clymb, a seller of outdoor apparel, reported a 10% lift in its conversion rate by adding the service.
While the streamlined service may well appeal to small sellers because of the easier integration and a built-in mobile interface, some observers wonder whether it will put off as many potential clients as it attracts, since some will be looking for the order-management integration.
“[Amazon] may be thinking this is the way to get us positioned with a larger number of merchants, which may or may not work,” says Beth Robertson, an independent payments-industry analyst. Up to now, she says, Amazon Payments “has appealed more to small businesses because of the inclusion of those [non-core] features.. Historically, it is what has helped them attract share.”
One supposed obstacle won’t be hampering the new version of Amazon Payments, says Taylor. Ever since the Web juggernaut launched its payments service for other online merchants in 2007, critics have said it would struggle to sign up business because potential clients would distrust Amazon as a competitor and would balk at sharing sales information with it.
But Taylor says the only information the platform requires merchants to pass on is the total amount of the sale. “[That distrust] hasn’t really played out in reality,” he notes. “There isn’t any information to be worried about sharing.”
These days, he says, he doesn’t hear about this alleged problem from the marketplace. “I hear it a lot from the press,” he adds.
