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Paypal enters daily deal market

December 19, 2011 | Online Marketing

EBay's PayPal business, aiming to challenge Groupon Inc. and LivingSocial.com in the market for online daily deals, plans to start offering coupons tailored to users’ buying habits and mobile-phone locations.

The company will make its first foray into mobile deals in the first quarter of 2012, partnering with some of the top 200 U.S. merchants, PayPal President Scott Thompson said. PayPal is chasing a daily coupon market that may more than double to $4.17 billion by 2015, according to research firm BIA/Kelsey.

Thompson said PayPal can use its knowledge about customers’ preferences to do coupons better than LivingSocial and Groupon with targeted offers that arrive on users’ smartphones as they’re passing stores. By moving into deals, PayPal can seek to make more money from its 103 million members, helping it close in on a goal of revenue as high as $7 billion by 2013, compared with $3.4 billion in 2010.

“The experience is going to be completely different than anyone else’s through and through,” Thompson said in an interview at PayPal’s headquarters in San Jose, California, last week. “We’ll only give you something that we think fits the category of unique and relevant. Everyone else is going to bombard you.”

Get the full story at Bloomberg Businessweek

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