How Google Pay morphed into a customer service tool

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CHICAGO — It took a few years for mobile wallets to get past the aura of just a "cool technology" looking for a problem to solve, but Google Pay and its peers are clearly finding their niche as a way to embed payments with customer engagement tools.

Accepting payments has long been a basic fundamental of operating a business, but in a digital age merchants now want to be able to engage with their customers wherever they are, said Jack Connors, head of commerce partnerships for Google.

"Five years ago, there was a lot of talk about whether mobile wallets were competitive with merchant mobile apps, and even at that time they were not, they were complementary to those channels," Connors said Wednesday at the annual Mobile Payments Conference. "But over the last couple of years, merchants have discovered that the mobile wallet is a perfect place to engage and is not at all competitive with what they are trying to do."

For their part, merchants at various times in the past six years have eyed the creation of a common mobile wallet through the now-disbanded Merchant Customer Exchange or focused on branded closed-loop payment apps they feel address their customer base and the experiences they want to deliver. But generally, they continue to accept most mobile wallets and take advantage of any customer interaction tools that result in more sales.

Google Pay has traveled a sometimes rocky road with pivots designed to improve its model as a digital engagement tool. The original Google Wallet eventually became Android Pay, and then Google Pay.

Google ultimately attached its mobile payment capabilities into various other parts of its digital ecosystem — including Gmail, Google Maps, virtual transit tickets and loyalty cards.

From a time when a mobile wallet was simply a way to make a payment through a smartphone, that wallet is now capable of helping merchants streamline their operations. It can do so by helping a user navigate an airline boarding process, enroll in merchant loyalty programs and accept special offers, Connors said.

"A core strategy at Google Pay is to create a smart airport," Connors said, referring to ticketing and other aspects of the airline experience taking place within the Google Pay app.

The ability to purchase movie tickets or enroll in a loyalty program to obtain a virtual card are other examples of how Google Pay can facilitate the interaction between consumer and merchant.

"With cinema tickets, the merchants are seeing four times faster checkout, and those with loyalty cards are seeing twice as many saved to Google Pay," he added.

In the coming months, Google plans to include the capability for a Google Pay user, within the app, to add value to different loyalty or prepaid cards that are part of the Google ecosystem. The new tool will also address those who currently possess digital stored-value cards, but have to jump through hoops to add more money to them, Connors added.

With the ability to transfer money within the Google ecosystem, the user can add value from a prepaid account to any other card stored in the app.

In addition, Google Pay has advanced its fraud-prevention tools in digital settings by using dynamic visuals or rotating QR codes in those instances in which consumers are downloading a QR-code based offer to present for redemption, Connors said.

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Google Pay Mobile wallets Mobile payments Prepaid cards Loyalty and rewards Google