Pago Mobile is designed to be a new way for businesses to interact with customers through their mobile devices by allowing them to browse, order and pay for local goods through their devices. Pago is rolling out today to over 50 businesses in Mountain View, Calif. and the Hard Rock Hotel and Casino in Las Vegas.A new local e-commerce application wants to bring local merchants in your town to your smartphone.
What problem does Pago solve? That is a fair question for any application coming into the e-commerce vertical. Pago has three things going for it - local, mobile and payments. From a merchant's perspective, there are not a lot of good options to getting their wares into the phones of the consumers around them with the ability to pay on the spot. Zaarly has attempted to jump into the local, mobile e-commerce bubble but its model of bids and deliveries rub some the wrong way. Pago is much more straightforward.
Attempting to Cut Back on the Hassle for Local Merchants
From the merchant side, Pago allows businesses an easy-to-start method of getting into consumers' smartphones. It is free to set up and is available through smartphones, tablets or browsers. Once the mobile storefront is set, consumers can buy and pay through the application. Pago uses Verisign payment technology and payment information is encrypted through 256-bit Secure Socket Layer. Pago also notes that it "adheres to industry standard best practices set forth by the Payment Card Industry." Pago can integrate with merchant's existing point-of-sale system to make the payment process as painless as possible.
Merchants can also advertise their deals and discounts through the application, giving it an aspect of the daily deal market that has exploded onto retailers the last several years. How is this better than Groupon or LivingSocial or Yelp or Google Offers or any type of deals that can be found through Foursquare, Facebook or Twitter? Because it is not up to some external sales team to get the local merchant to bid and promote some daily deal that may or may not be advantageous to the business. Many local merchants do not have time to deal with all the sales calls from the likes of Groupon, especially when they do not understand exactly how the deal (in terms of payment schedules, expirations etc.) are supposed to work. In theory, Pago could give them the ability to advertise their discounts through the application as easy as it would be to make a sign and hang it in the window or updating its Facebook status.
Will Consumers Use It?
On the consumer side, Pago is supposed to eliminate a lot of the hassle involved with shopping at local merchants. The company pitches itself as "stop waiting in line, getting botched orders." That is a dubious claim because it is hard to gauge real world effects of external technologies on merchants. I may call my local pizza shop to go pick up a pie, but when I get there, I have to wait to get to the counter just like everyone else. Pago also allows for social sharing through Facebook and Twitter with the ability to send gifts to friends. It will be available through iOS, Android, BlackBerry and Windows Phone 7.
Will it work? Maybe. Affluent urban areas with a high rate of smartphone penetration could benefit from Pago, especially if Pago and the merchants can figure out effective local marketing and awareness campaign. Yet, this is certainly not a national service any time soon. It will be interesting to see if consumers even want to shop and pay at brick and mortar locations through their smartphones.