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PayPal Trumps Google Checkout in J.P. Morgan Survey PayPal Trumps Google Checkout in J.P. Morgan Survey
By Jennifer LeClaire
January 19, 2007 10:34AM

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Google Checkout and PayPal -- in addition to lesser-known services such as Greenzap and BillMeLater -- are essentially reinventing the online payment wheel, according to some analysts, and doing that successfully depends on technology that works well, coupled with user-friendly interfaces on both the consumer and the merchant side.
 

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Google this week continued its aggressive efforts to woo online shoppers to its Checkout payment system with a $10 sign-up offer on its home page. But some consumers who have followed the search giant into the payment arena aren't glad they have.

Google Checkout ranked far below payment service PayPal in a customer Relevant Products/Services-satisfaction survey of online shoppers that J.P. Morgan released on Wednesday. In fact, only 19 percent rated Google's Checkout service as either "very good" or "good." The rest relegated Google's new offering to the "average," "poor," or "fair" categories.

PayPal scored higher marks. Nearly 45 percent said the eBay-owned service was "good" or "very good."

"Google may need to shore up its payment operations before building lasting user loyalty," the J.P. Morgan report stated. "[Checkout's] lower brand awareness coupled with its low satisfaction rate leave much room for improvement."

Checkout Complaints

Indeed, Google Checkout's official discussion forum signals user concerns over the product. Users report error messages in the checkout process, confusion over how the payout system works, problems with the user interface, and even trouble logging in with Internet Explorer.

"I have four orders in the queue, they are all stuck in 'Charging.' I cannot process or cancel them. Some have been in there for hours. My customers are getting ticked off, and I'll be losing some of the orders soon if they don't get un-stuck. What can I do?" asked one user in a post dated January 18. That user's questions were echoed by several other merchants in the forum.

Meanwhile, a user named "KT2240" expressed anger over Google's mediation efforts. According to forum posts, KT2230 paid for two DVDs through Google Checkout last November, but did not receive them.

"What kind of buyer protection does Google have?" Kt2240 wrote. "To me, they have shown absolutely none. This was my first purchase, and I have been sure to tell as many of my friends/family about my experience. I'm so frustrated... So Buyers Beware...big time!"

Google could not immediately be reached for comment.

Reinventing the Wheel

Google Checkout and PayPal -- in addition to lesser-known services such as Greenzap and BillMeLater -- are essentially reinventing the online payment wheel, according to some analysts, and doing that successfully depends on technology that works well, coupled with user-friendly interfaces on both the consumer and the merchant side.

Jupiter Research analyst Asaf Buchner recently bought a pair of sneakers through Google Checkout. He said the user interface wasn't difficult to navigate, but finding merchants that accept Google Checkout for payments was.

Although Google's new Checkout service is still in the early stages of operation, it does offer one advantage over PayPal, according to Buchner. "With Google Checkout, you don't need to provide the merchant with your e-mail address or personal information," the analyst noted. "That gives consumers assurance that they won't be bombarded with spam from that store."
 

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