PayPal is moving away from the Honey brand, a $4 billion acquisition it made in 2019, with today’s launch of PayPal Rewards. The new program will replace “Honey Gold” – a rewards program for users of the Honey browser extension, which allows users to redeem their points for cash, gift cards or credit for PayPal purchases. With PayPal’s new rewards, consumers will be able to track and redeem their points directly in the PayPal app and have new ways to earn, the company said.
The deal with Honey was supposed to give PayPal a better position in the face of increasing competition in the payments space from bigger rivals including Apple, Google and even Facebook (now Meta). The battle for consumer acceptance of online and mobile payments has moved away from the checkout page itself to compete with all the other places people go to discover, browse, be inspired and search for deals – including merchant websites and platforms. social media. like Instagram, Pinterest and today TikTok.
A rewards program, like the one offered by Honey, works to attract customers by offering promo codes and coupons to favorite retailers while driving them away from Amazon for better prices. Features like a price tracker “droplist” also help shoppers find the best deals on items they’re considering. And with the redesign of the PayPal app last year, personalized offers and rewards have also become a bigger part of the mobile experience.
This year, PayPal customers have saved nearly $200 million through Honey’s cashback and rebate program, PayPal says.
With the launch of PayPal Rewards, the company now combines the rewards it offers PayPal customers across multiple PayPal products, including the Honey browser extension, the PayPal app and, in the future, various card products. Rewards will also have their own special place in the new section of the PayPal app, where customers can track and redeem their points as they earn. When users want to redeem their points, there will be no limit on account level or minimums, the company notes, and points can be converted to cash back at a rate of 100 points, which is equivalent to $1.
Once redeemed as cash, the funds can be transferred to a linked bank account, deposited into a PayPal savings account, donated to charity or sent to someone else as a peer-to-peer (p2p) payment.
With the new in-app hub, users will also be able to earn points through personalized in-app PayPal engagement, with a browser extension, and can be stacked with rewards earned from their card payment programs.
This personalized engagement introduces a new way for a customer to earn PayPal Rewards points by doing things like linking a debit card or bank account to PayPal, for example. If the user has already done this, they can be offered another action to take.
The company is announcing the move ahead of the 2022 holiday season and traditionally the biggest quarter for online shopping.
This year, however, the e-commerce landscape looks a little different, with more spending starting earlier, thanks in part to Amazon’s decision to host a second Prime Day event in October, prompting other retailers to follow suit. Still, Adobe predicts that consumer spending will still grow this year by 2.5% between November 1 and December. 31, reaching 209.7 billion US dollars.
“With the financial challenges people face today, caused by rising prices and the need to cut budgets, it can be frustrating to shop for everyday necessities or plan a vacation,” Greg Lisiewski, vice president, president of global procurement and postpaid, said in a statement. “PayPal Rewards makes it easy to find promotions, discounts and great deals when you shop with PayPal — through cash back, discount codes or other rewards,” he said.