Google opens the Checkout

By Matt Whipp

Posted on 29 Jun 2006 at 15:49

Anyone who remembers Microsoft's plans to get its massive Hotmail userbase to sign up its collective credit card details to a Passport account, enabling fast online purchases will recognise Google's latest announcement: Google Checkout.

This time around it's a Google account you need. And for most users it should make buying through participating stores, which include Levi's, buy.com and Timberland, a simpler process.

Once your Google account is primed with your credit card and delivery address information, you won't need to enter it each time you make a Google Checkout transaction. From a security point of view, users will benefit as they don't have to share that information with retailers.

What's more, all such transactions are securely archived, so you have a history of your activities, and you can filter out emails from stores you buy from, so they don't end up in your personal inbox.

Having all that information not only on search activity, but also on purchasing activity will give Google plenty of data to crunch, and a window into the operations of retailers signed up to Checkout. It will be able to track, for example, the conversion rate of search sessions that actually lead to a sale - data that some companies might hold dear, probably including Google.

However, it's clearly not the PayPal killer on the tip of everyone's tongues right now, but Checkout has been carefully tweaked to elbow PayPal in other ways.

Merchant fees run at 20 cents and 2 per cent of the transaction for using the service - something like two-thirds of PayPal's charges. To integrate the service is straightforward: apart from being free to use, retailers can add Checkout options with a simple bit of copy and paste code, or can more tightly integrate it via a published API. But more subtle is how tightly Checkout is tied with AdWords.

AdWords advertisers using Checkout have a small shopping trolley icon displayed alongside their listing in search results, and every dollar spent on AdWords clears $10-worth of Checkout fees.

This will make Checkout fees for AdWords advertisers negligible - an encouragement to sign up to the service, of course. With Checkout icons on the results pages, this will encourage searchers to use the service. So, it is likely that being a merchant that hasn't signed up could turn out to be a disadvantage, if the service becomes successful.

More information is available at checkout.google.com.