PYPL Stock: This Could Be Big for Paypal Holdings Inc

PYPL StockPaypal Holdings Inc (NASDAQ:PYPL) wants to make it a lot easier for you to buy things online. Paypal, the leader in e-commerce payment systems, recently launched a new serviced called “Paypal Commerce” that could end up being big for PYPL stock.

Paypal is touting Paypal Commerce as the next-generation online shopping experience that brings merchants and consumers together anywhere online. The new service, which is in closed beta testing, is part of an expanding segment of e-commerce called “contextual commerce.” That just means that a consumer can make a purchase anywhere they see a product they like.

This means that merchants will be able to place a “buy” button anywhere a consumer will see their product, such as an e-mail, social media post, blog, article, or ad from their computers or mobile devices. Paypal is hoping that by creating buy buttons anywhere, consumers will be more enticed to make a purchase, especially when it’s an impulse buy.

The market for contextual e-commerce is just getting started, so Paypal is hoping to jump ahead of the pack. The market is hard to quantify at the moment, but the potential is in the hundreds of millions of people who are online everyday, visiting social media sites and other web sites where products pop up all the time. With a huge potential market, other companies are, of course, jumping on the bandwagon and working on their own versions of contextual payments.

Alphabet Inc (NASDAQ:GOOG) announced a feature last summer called “Purchases on Google,” which will enable consumers to buy products directly from mobile search ads. Facebook Inc (NASDAQ:FB) has already started to add its own buy button to ads on users’ newsfeeds.

Paypal has already dipped into the market through its Braintree payments platform (Paypal acquired the company in 2013). Last December, Braintree announced that it is the launch partner of Facebook Messenger’s new transportation services division that will allow users to order and pay for an Uber ride in “Facebook Messenger.” Facebook users will be able to use Uber even if they don’t have an Uber account.

The advantage Paypal has, at least right now, is that it is the leader in e-commerce payments, with thousands of partnerships with merchants around the world.

The Bottom Line on PYPL Stock

What does all of this mean for PYPL stock?

With contextual payments still in their infancy, it’s a bit too early to gauge how fast the market takes off with consumers. In theory, it should be well received, since it provides an easily accessible and seamless shopping experience, especially on mobile phones where commerce is growing. With its already established brand as the online payments processor, Paypal Commerce has the potential to be a game-changer for the way consumers shop and for PYPL stock.