On Monday, PayPal officially began trading as a standalone company on the Nasdaq. In the lead-up to its detachment from eBay, PayPal CEO Dan Schulman divulged some of the company’s biggest strategic priorities going forward in eBay’s Q2 2015 earnings call.
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- Focus on mobile: Schulman wants turn PayPal into a mobile-first platform through the development of new mobile products and the enhancement of existing ones including Venmo, Braintree, and Xoom. Mobile already accounts for 30% of the company’s total transactions, up 1 percentage point from Q1, and up 42% YoY.
- Driving engagement through mobile: Part of PayPal’s mobile-first strategy is offering features to boost engagement on mobile platforms. To do this PayPal is expanding its one-click checkout feature, One Touch, to a majority of its clients by end of the year. The feature takes the friction out of the checkout experience which can lead to lowered shopping cart abandonment. Further, PayPal has revamped its back-end technology leading to a 50% increase in payments processing speed.
- Mobile in-store efforts materialising: PayPal also wants to strengthen its mobile in-store business, partially by riding on the success of its subsidiary, Paydiant. The Paydiant-backed Subway app was the second-most downloaded food and beverage iOS app in the US in June. The app can be used at 30,000 Subway stores.
PayPal is focused on mobile commerce because it’s the fastest growing channel. Mobile commerce gross sales volume (GSV) rose 48% YoY in Q2 2014 — three times faster than the growth in desktop-based e-commerce. Although mobile commerce is still a small share of e-commerce volume — 13% in Q4 2014 according to our estimates — it’s poised to dominate commerce in the long run.
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