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• Published on 26 July 2017
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Amazon Payments wants to "take out" the competition

It is getting harder and harder to keep up with Amazon.com, Inc. Just this year the behemoth online retailer already has:

• Introduced Prime Wardrobe Opens a New Window. , a fashion delivery, and return platform;
• Signed an agreement Opens a New Window. to simulcast Thursday night NFL games;
• Pondered a wireless deal Opens a New Window. with DISH Network;
• Significantly penetrated Opens a New Window. the do-it-yourself auto parts supplier market;
• Planned to create its own version Opens a New Window. of Best Buy's popular Geek Squad;
• Introduced products and begun to dominate in the the smart home Opens a New Window. market;
• Announced plans to acquire Opens a New Window. organic grocer Whole Foods Market;
• Filed a patent for a meal kit delivery service that will probably decimate Opens a New Window. Blue Apron Holdings;
• Worked on a new messaging service Opens a New Window. called Anytime;
• Agreed to sell Opens a New Window. Alexa-compatible Kenmore appliances from Sears Holdings on its website;
• Hosted its most successful Prime Day Opens a New Window. ever, increasing sales by more than 60% over its Prime Day.

Whew! Most companies don't entertain that number of new ideas in a decade, much less the first half of a year. With all this going on, investors could be forgiven for missing the company's latest bit of news. Earlier this month, Amazon announced a new feature for its mobile app, Amazon Pay Places. The new Amazon Pay platform will now allow customers to order ahead at participating retailers and pay through their Amazon accounts.

The feature is being given what amounts to a glorified test run with select T.G.I. Friday's locations in Boston, Philadelphia, Baltimore, Washington D.C., Richmond, VA and Wilkes-Barre, PA. The function will be found inside Amazon's app in the drop down menu under the "Programs and Features" section.

Amazon Payments is going "Places"

Amazon Payments is a digital platform that allows customers to make online or mobile purchases using their payment information from their Amazon accounts. In a February press release, Amazon gave investors a look behind the curtain at the platform Opens a New Window. . Though it has surely grown in the interim, at the time of the release more than 33 million customers had used Pay with Amazon to make a purchase. Though we weren't given total payment volume, the company did state it had almost doubled in 2016. Its merchant coverage growth was even more impressive: Vendors accepting Amazon Payments increased by 120% year over year. The press release proclaimed more than half of the customers who used the platform were also Amazon Prime members.

Amazon Pay Places is a significant expansion for Amazon Payments, ushering the platform into the world of brick-and-mortar retail. In an interview Opens a New Window. with PYMNTS.com's Karen Webster, Amazon's Vice President of Amazon Pay Patrick Gauthier said:

One of the things we've been doing the last couple of years is thinking about how to connect merchants with the Amazon customer base, knowing they are very active connected shoppers whether online or on mobile. With what we are taking the lid off today — we are enabling merchants to instantly reach people who are highly mobile and very desirable as customers — without having to worry about app distribution.

One potential snag

While Amazon Payments continues to show explosive growth, it will probably eventually hit a wall. After all, it's hard to imagine that too many retailers will want to share their sales data with a deadly competitor like Amazon. At the 2017 Bernstein's Annual Strategic Decisions Conference, PayPal Holdings Inc's CEO Dan Schulman stated PayPal was able to significantly increase its merchant coverage after being spun off from eBay for the same reason until then, rival retailers were wary of eBay having access to its data. Schulman said:

...the real difference is we're a neutral third party now ... I did not realize how much that was holding back eBay ... PayPal being associated with eBay, you have merchants who just naturally thought of eBay as a potential competitor, and therefore, were reluctant to put a payment scheme in that takes data and information that might somehow be shared back with eBay. And so being a neutral third party, tremendously valuable.

Re-disseminated by The Asian Banker from Fox News