Visa Checkout Gives Visa Toehold in Crowded Digital Payments Space

Look Out for a Big Presence at the Olympics

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Visa and Virgin America are pairing up for a co-branded push using Pinterest's cinematic pins.
Visa and Virgin America are pairing up for a co-branded push using Pinterest's cinematic pins. Credit: Visa/Virgin America

Visa is retooling its efforts to prepare for the second wave of its Visa Checkout push following the initiative's early success. The online-payment system has carved out a niche for Visa in the crowded digital payments space, despite growing competition from companies like MasterCard, PayPal and Google.

"When we looked at the world … we just felt like we weren't in the mobile ecommerce space the way we wanted to be," said Chris Curtin, chief brand and innovation officer at Visa. "Now, we are literally everywhere," he said, referencing the brand's tagline: "Everywhere you want to be."

Visa Checkout, which is available in the U.S., Australia and China, stores credit card and shipping information so customers can checkout across more than 125,000 retailers with a few clicks. "We're trying to replicate the same ease that you would associate with Visa in the physical world in the virtual world," said Mr. Curtin.

Four million users have registered for the web and mobile-payment solution since it was introduced last July, and the service partners with 140 major retailers and 260 financial institutions, the company said.

On top of strong adoption figures, Visa Checkout shoppers also completed 69% of their shopping cart transactions, according to a new report from ComScore. PayPal Express Checkout customers completed 62% of their purchases and traditional checkout customers complete 41%. The data suggests that the ease of Visa Checkout is getting more shoppers to actually buy things, a draw for Visa's brand partners.

"Visa Checkout is a product that at its core is architected to produce better conversion for merchants and a better buying experience for consumers," said Mr Curtin. "It's early success is confirmation of the fact that the product is working the way it was architected to be."

The initiative was one of Visa's top marketing priorities in North America last year, according to Mr. Curtin, and it will remain a key focus this year.

Visa spent $474.4 million on advertising in the U.S. in 2013, according to the Ad Age DataCenter. And in 2014, the company spent about $4.2 million promoting Visa Checkout, according to Kantar Media.

"In year two, we want to replicate what we did in year one and even amplify upon it," said Mr. Curtin.

Starting this summer, Visa plans to leverage more of its brand partners and sponsorships like the National Football League as it gears up for key selling periods including back-to-school and holiday. "We had a great year but we're also very hungry," said Mr. Curtin. "We're building, we're growing … and we're eager to do that with like-minded partners."

Like last year, Visa will ease into phase two of the marketing campaign for Visa Checkout, kicking off in the summer and ramping up in the fall and winter months with a mix of digital and TV. "Our digital got a lot better as we got into the fall and into the holidays," said Mr. Curtin. "We were at our best when we needed to be."

Visa's merchant partners were critical to last year's effort. Retailers including Pizza Hut and 1-800-Flowers linked up with Visa for co-marketed pushes to promote the service, which helped the company spread the word to more consumers. Visa is currently working on "large-scale" pushes with new partners Dunkin' Donuts and Williams Sonoma. The company is also working with Virgin America and children's retailer Crazy 8 to promote the service with Pinterest's new "cinematic pins" -- an animated ad format rolling out this summer.

Visa's sponsorships are also at the core of its marketing campaign. Its partnerships with the NFL and the FIFA Women's World Cup, which it will expand on this year, will be at the center of the campaign.

Next summer, Visa's long-time sponsorship of the Olympic Games will also play a role. The 2016 summer games -- to be held in Rio de Janiero, Brazil -- will mark the 30th anniversary of Visa's partnership with the Olympics and the company is already preparing for the big event. "Be on the look out for a big presence from Visa in the Olympics," Mr. Curtin said.

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