Paypal Ms Case in Harvard Business Review

1253 Words Sep 15th, 2011 6 Pages
PayPal Merchant Services: Harvard Case

Services Marketing

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Introduction

PayPal

• Founded in December 1998, PayPal is a leading global online payment company.

• Purchased by eBay in October 2002.

• Over 100 million registered accounts globally and available in 55 markets.

• PayPal has a local presence in 13 countries outside the US, including UK, Canada, Australia, Austria, Belgium,France, Germany, Italy, Spain, Ireland, Netherlands,Switzerland and China.

• Supports payments in U.S. Dollars, Canadian Dollars,Australian Dollars, Euros, Pounds Sterling,Chinese Yuan

• Regulated by the FSA.

• Passported License to 25 EU countries.

• Becoming a major player in the Merchant (off-eBay) space.

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For Off-eBay merchant services PayPal can target both existing users as well as New Users.

1) Existing users

2) New Customers

In the new world,a lot of people are involved in internet.Many people are transferring money over the internet.

Many small companies,bloggers,web publishers earn money through their sites and advertisements. PayPal offers them a quality and secure way to manage and transfer their money.

Product changes:

Many off-ebay customers are not attracted towards PayPal because of the fee based revenue model.People mainly prefer free services.Even credit cards offer a interest free credit period in which money transfer/transaction can be done without paying any extra money.Paypal should also think on modifying its service on the similar lines.

1) Paypal should try to give service free for a limited number of days else some fee or interest should be charged

2) Paypal should concentrate on revenue through advertisements on its PayPal portal,sponsorships,bulk deals, special promotions.

3) PayPal can use differential model for fees.e.g. First few transactions can be made free and some money can be charged over a certain limit or vice versa.

Q4: On the merchant side, to what extent should paypal emphasize the recruitment of large, established online retailers versus small and midsized merchants? what changes, if any, should be made to pricing terms, product features and other policies ?

PayPal should
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