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Paypal vs. Google Checkout in the UK
December 19, 2007
Last week my colleague Heather Dougherty posted about the success of alternative payment providers in the US this Christmas. While Bill Me Later hasn’t yet launched in the UK, the other two major players - Google Checkout and Paypal - are both well enough established that we can compare their success in the UK. As the chart below illustrates, Paypal was in the lead for the first couple of months of the holiday shopping season, but Google Checkout overtook it two weeks ago and has maintained a marginal lead since.
Although the two sites are competitors, they have quite different sources of traffic. As you would expect, the majority (59.1%) of Paypal’s traffic comes from its parent, eBay (combined UK and US sites), with another 12.4% from Google (UK and US sites again). A further 11.7% comes from a combination of email providers, social networks and banks; but just 2.2% comes from non-auction Shopping and Classified sites. This compares with 45.3% for Google Checkout, which helps explain the large number of retailers in the table below llustrating the top 20 upstream sites visited before Google Checkout last week.
Most of these are smaller independent retailers, although two larger retailers (Vodafone and Dabs) also appear. Dabs accepts payment via both Google Checkout and Paypal, but currently sends 16 times as much traffic to former than the latter. However, visits do not always mean purchases. When Heather Hopkins posted on this topic earlier in the year, there was some discussion in the comments section about what people did once they got to the shopping cart.
While I can’t provide abandonment data, it is likely that people visiting another retail site after either Paypal or Google Checkout may have not completed their purchase. In other words, a lot of downstream traffic to our Shopping and Classifieds category could be used as a proxy for abandonment rates. As the graph below illustrates, more people currently visit another Shopping and Classifieds site after Google Checkout than after Paypal, and that the gap is widening.
Posted by Robin Goad at 03:00 PM
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In Categories Christmas | Financial Services | Retail | Shopping and Classifieds
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Links to weblogs that reference this entry:
- SearchCap: The Day In Search, December 21, 2007 (Search Engine Land: News About Search Engines & Search Marketing)
Below is what happened in search today, as reported on Search Engine Land and from other places across the web.... [Read More] - Google Checkout Overtakes Paypal In UK (AccuraCast Search Daily News)
A recent report from Hitwise found that traffic to Google Checkout has overtaken PayPal in the first two weeks of December and has held its lead since then. The number of downstream visitors from Google Checkout has also grown rapidly, which might indi... [Read More]
Comments
Thanks for your comment, Tim.
The numbers don't exclude return visits to the same retailer, and it is inctersting to see that the top retailer before visits before Google Checkout (Goldmiths) is also the top retailer after. However, looking at the upstream and downstream clickstream it's clear that each retailer is sending more traffic to Google Checkout than vice versa, plus there is no guarantee than it's the same visitor going to retailer a both times.
The same is also true with Paypal and eBay UK, which is currently the most popular site visited both before and after Paypal. So it seems that some of this traffic may be curious people using the checkout basket as a way of finding information and then going back to the retailer. I've always assumed that this was the case, and that a large proportion of people who 'abandon' shopping carts were only there in the first place to calculate the final price or work out the shipping charge. I do this a lot myself, often because its the only way of working out the final price, and then go back to the site to continue shopping before returning to the checkout page.
Robin
Posted by Robin Goad | December 19, 2007 05:30 PM
They solicited me and offered one year no fees no charges so I left paypal and saved about $3500. They approved my business a year ago. Only one chargeback and they handled it horribly. No big deal but Paypal was and is more professional along those lines.
A year to the day they told me that as a dog breeder, I am in violation of their policies on acceptable products. It took Google checkout a year to figure that out. I went back to Paypal several weeks ago and have not looked back. Google checkout customer service stinks.
Decided to stop spending $2250 a month with them as well on adwords. Shifted those dollars to yahoo and actually had more daily visitors of the same quality.
Posted by Rich Martel | December 20, 2007 03:43 PM
Hi Robin,
could you also list the different sources of traffic for Google?
And would a similar picture also be available for other countries such as Australia?
Posted by inga | January 15, 2008 04:39 AM
In my opinion anyone that uses the slow, hanging, won't refund, won't help, difficult, frustrating, annoying, unfair, rigid Paypal system is mad. Google is quicker and easier.
Posted by Allan | January 23, 2008 02:42 AM
We recently posted about the success that Google Checkout had by assisting with the Burma charity campaign here:
http://weblogs.hitwise.com/robin-goad/2008/05/burma_myanmar_google_charity_donations.html
Thanks, Robin
Posted by Robin Goad | May 13, 2008 05:18 PM
Google checkout is great but still paypal has more advantage like they are accepting payment from 55 countries and google only from two.
Posted by tech news | October 23, 2008 10:02 AM
The information about where people are going after Google checkout is extremely interesting.
Quick question: are you ignoring a return to the original merchant's site? That would be a very normal behaviour and to be expected.
Assuming that you are ignoring that and the figures show sessions going from merchant A to Google Checkout and then on to merchant B, then I would also consider the time of year. I wonder if we're seeing evidence here of people doing the online equivalent of heading for Bluewater for a 'get it over with in one go' session? Perhaps you can throw some light on that?
But I also wonder if people are clicking the unfamiliar Google Checkout button just to see what it's about, without then making the purchase. It is a new feature, after all. Until the huge convenience factor is understood (and that will itself encourage the multiple shopping sessions, I believe) I think many people may only be looking out of curiosity.
Posted by Tim Leighton-Boyce | December 19, 2007 05:05 PM