PayPal is Serious
PayPal invited 1,500 developers to their Innovate09 conference in San Francisco on Nov 3-4, 2009. The company is very serious about competing in the financial marketplace.
High-Level Business Summary
On Nov 3, 2009 PayPal opened its application programming interface to the developer community. You might think of the API as a doorway that allows authorized software to interact directly with PayPal’s payment system. One benefit: If you’re building a web site and you want to accept PayPal payments without sending visitors away from your site, the API will let you do this. More benefits are listed below.
The Developer Community: X.com
X.com is a very cool URL, like the ultimate vanity license plate! PayPal uses the URL to support the developer community with peer-to-peer forums, sample code, and instructional information. Naveed Anwar of PayPal gives a brief intro below. Anwar ends with a very compelling invitation: “Let me help you make money.”
Pre-Approved Maximums and Adaptive Payments
Companies sell more when they make it very easy for customers to spend money. That’s the whole idea behind credit cards. PayPal takes this to a new level with Adaptive Payments. Let’s say your business runs a pinball game that charges ten cents per pinball. Under the old PayPal system, your customer would have to log into PayPal and pay for a ball each time they pulled the plunger. Very cumbersome!
However, with the Adaptive Payment feature, PayPal pre-approves a maximum dollar amount with one API call. That way, your customers can play continuously, fattening your bank account with each round.
We could have used a more serious business example here, but you get the point!
Adaptive Accounts
Web usability studies have shown that the more you ask a customer to type, the more likely they will abandon a purchase for something else. All of us are lazy to some degree.
PayPal’s Adaptive Accounts feature reduces the amount of customer typing by accepting customer information directly from the merchant’s existing database. So if your site already has customer profile information, they won’t need to retype when they purchase through PayPal. Your site can send the info directly to PayPal through the API.
Micropayments
Consumers in the developing world are very adept at using their mobile phones for purchases. Phone companies understand this, so they are aggressively moving into the micropayment space.
Of course, developing nations can become developed nations very rapidly. Observing this trend, PayPal execs had to ask themselves this question: As these consumers move up the economic ladder, do you want them to be acclimated to PayPal or the phone companies?
PayPal can now accept micropayments through their newly available API. Of all the new features, I’m betting that this one will generate the greatest ROI over the next ten years.
Charity Frag: Gaming Meets Giving
Games are a waste of time and they don’t help anybody, right? Not necessarily so. A company based in the UK has created game that benefits charity. Charity Frag was born at London’s Charity Hack in September 2009. The developer team blended an open source version of Quake 3 with code that leverages PayPal’s API. Opponents shoot each other in the game. When a player dies, his PayPal account donates ten pence to the shooter’s charity. Here’s a clip from the game:
So… take out your frustrations and help a charity with the PayPal API.
Netbook Giveaway
Every attendee received a complimentary Asus 1005HA netbook pre-loaded with PayPal software. Imagine the logistics of distributing netbooks to 1,500 people! One great thing about the netbook: Although it’s running Windows XP Home Edition, the hard drive is split into two 72GB partitions. Perfect for a dual-boot (yes, Linux!) configuration. One guy tweeted about his success with the new config before the end of the conference.
Music & Networking
The Tuesday night party was a nice touch with great food. The downside: Loud music. I certainly enjoyed loud music as a teenager, but when I’m in a room full of developers I’m more interested in networking and sharing ideas. PayPal can help its API movement by giving developers plenty of opportunities to interact and brainstorm together. That’s what they’ve done with X.com, and they should do the same outside of cyberspace.
Vendors and the PayPal Team
Every PayPal person I met at the conference was engaging and enthusiastic about the offering. That’s a plus. The vendor area was well-staffed with people who were ready to demo live apps and answer questions.
Evolution of Economic Exchange
Human commerce has gone through three transitions in the past ten thousand years:
- From barter to coins.
- From coins to paper (including checks).
- From paper to plastic.
We are now in the midst of the fourth transition: From plastic to electronic. PayPal is not alone in recognizing this trend. By launching Innovate09, PayPal shows that it takes this latest transition very seriously.