Reviewed: Google Checkout Payment System

Ian Lurie Jun 29 2006

Google released their new Google Checkout payment system today, and I took it for a test drive, as a consumer and as a merchant.

A quick note about the test case: I used the simplest version of Google Checkout – their ‘buy now’ button. The ‘buy now’ button takes the customer to checkout.google.com to complete their purchase. Google does offer a complete API, where you can integrate their service directly into your own site, but I wimped out.

Setting Up My Store

I decided to add a Google Checkout button to my book page. I already have a Google account, so it took me about 20 minutes, start-to-finish, to input a product (my book) and place the Google ‘buy now’ button on my site.

The process was pretty straightforward, with two exceptions: One, when you set up your account as a merchant, it’s very easy to wander back into the consumer side of things and get lost. I had to stop the signup process and start over again when I somehow ended up moving from creating a merchant account to setting up my consumer account. Two, the Google Checkout system doesn’t let you save the buttons you create; if you want to edit them, you have to create a new button. That’s merely annoying for me, since I have one product. It would be maddening for anyone with several products. But PayPal suffers from the same problem, so I can’t complain too much. All in all it was absolutely simple – anyone who can handle even the most basic web page editing can use Google Checkout.

Two major features are missing, though: I didn’t see any way to control where the customer lands after completing their order. That’s a major deficiency when compared to PayPal. And there didn’t seem to be any way to integrate shipping into the process. I went to look at the Google Checkout Blog, but at the moment that site appeared down.

On the plus side, though, if you spend $1 on Google Adwords, you can process $10 in sales for free. So, if you spend, say, $3000/month on Google Adwords advertising, you can sell $30,000 in goods through Google Checkout at no cost. That is a huge advantage over PayPal.

Also, by linking your Adwords account to Google Checkout, you get a slick little Google Checkout badge next to all ads you run for that site. That might generate higher purchase rates – we’ll see.

Making a Purchase

Next, time to test it all out. I used a separate Google account, set up my purchasing options by entering in my default credit card, and bought a copy of my book.

Checkout was super-simple. The cart gave me the option of receiving e-mails from Portent Interactive, and purchasing was basically a one-click procedure. Google Checkout did just dump me on their own ‘thank you for your order’ page.

The Verdict

Google swears they’re not trying to compete PayPal and eBay through this service, but it looks to me like they’re going to go head-to-head. Their system lacks a couple of features that PayPal has, and that could hurt them in the short run.

In the long run, though, Google’s ability to integrate Checkout with their advertising network and hopefully their analytics tool could make them a force to be reckoned with.

Test drive of their more advanced Checkout integration options coming soon…

A Quick Update

I linked my Adwords account to my Checkout account. That is supposed to show small checkout badge in my Adwords ads, and indeed my Adwords account shows that ‘Google Checkout Badges are active’. It also shows the badges in Adwords. But 12 hours after that message showed up, I still don’t see any badges in Google search results. Hmmmm. More bulletins as events warrant.

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tags : conversation marketing

23 Comments

  1. I would have to disagree, I think that it is great that google came out with this, finally some one who will not freeze your account for nothing! (Paypal!)

  2. David Green

    David Green

    I had a look @ Google checkout today and I have to say that after so much hype I am dissapointed. I mean they are only really selling it on password storage convenience, sure not a bad idea.. but I was expecting much, much more from Google. I really hope they do start competing with PayPal and start developing an electronic form of payments that is truly international.
    The other thing that concerns me is the overall Google style of business, which usually does not bother dealing in people for smaller accounts, but rather in robots. I can just see so many small merchants getting burned by google for all sorts of reasons and then just recieving some computer generated letter saying that their account has been suspended. We’ll see, maybe I’m just being cynical.

  3. Shariq

    Shariq

    thanks a ton for your review..
    one thing I had to ask..
    if you can’t control where the customer lands after ordering.. how do u fulfil their order???
    like if it’s a digital ebook (.pdf) that the customer was supposed to download after ordering..
    is contacting him by email the *only* option to deliver the product?
    strange.. ainnit!?
    still.. thanks a ton for your review!

  4. ian

    ian

    Hi Shariq,
    The checkout process for the most basic ‘buy now’ button ends with you sitting on a Google ‘thank you for your order page’. That sends an e-mail notification to the customer and the merchant, but yah, that’s it.
    As I read up on the API, I’m coming to believe Google is staking a lot on it, rather than the quick buy now button. The API allows much more natural shopping cart interaction.
    Ian

  5. You can use Google Checkout API for integrating the shipping and the page-you-go after the sale…
    It’s a true Google Passport..

  6. Thanks for the review.
    Does it cost more to use the complete API version?
    As far as the verdict goes, Google always tries to say their no going head to head with different ventures, but they always end up taken over and dominating the market. What isn’t Google trying to compete at?
    Taylor

  7. ian

    ian

    Google Checkout is not a person-to-person payment system. It’s person-to-store. So it doesn’t really compete with PayPal, at least in that respect.
    I don’t think the API costs any more, except in sanity. I’ve spent a few hours working on it now and it’s not fun.
    Off to WoW for a little decompression…
    Ian

  8. cuush

    cuush

    Yeah, but Paypal’s bread and butter is in the eBay B2C market…not the WesternUnion style C2C market, that’s just a bonus feature.
    Google is swearing they aren’t in direct competion with Paypal because they are humble and cunning businessmen.
    Something Paypal could learn from, if they weren’t about to lose 50% of their market 80% share.
    Long live Google and the robot army!

  9. mike

    mike

    This was a great idea if brought out by nearly any other company – but looks like another looser from Google.
    I’ve read numerous blogs and reviewers who have labelled Google Checkout as a “PayPal killer” – It’s anything but a PayPal killer. Google’s inability to process international payments, purchase limits placed on some customers, and a “payout” limit Google has imposed on most merchants, are truly ridiculous.
    If you are a merchant with this limit, it is likely $500.00. This means that if you sell over $500.00 using Google Checkout during the month, you will only receive $500.00 from Google during that month – the remaining balance would be carried to the next month, and applied to that monthly limit.
    Example: let’s say you sell $750.00 through Google in July….you will receive $500.00 during July, with $250.00 held by Google, and not paid until August. When paid in August, that carry over $250 from July would also be applied toward your August “limit”, leaving only $250.00 in payments available for August sales.
    In a “real life” example, lets say you sold $1500.00 in July – you would receive $500.00 in July, with the $1000.00 carried forward to August. However, your cap is still $500 – so you would receive another $500 in August, and another $500 in September.
    What would happen to your revenue from sales in August and September you ask?..well, that would all be “carried forward” until your “limit” allowed payment.
    It’s alot like being paid an allowance by Mom and Dad – except they usually paid you!
    This is literally an interest free loan that Google has given itself from the revenues of it’s “customers” – which are other businesses.
    AND – they won’t pay interest on the money they are holding.
    Based on public records, Google made about $17M each DAY last year on advertising revenue…shouldn’t they be the ones giving customers a loan?!
    I was also at Google’s inability to answer some basic security questions in regards to it’s service, beyond providing a copy of their published FAQs.
    Nope – our company won’t use it, and we would highly recommend other merchants and shoppers read the FAQ VERY carefully, and ask all questions before providing your information.

  10. ian

    ian

    Regarding the previous comment – I haven’t gotten a response from Google yet, but I can’t find anything about a $500 limit in their Terms of Service. Would Timberland really use them if that were the case?….

  11. In Regards to your “limitations to the Google Checkout Buy Now button option” —-
    “Two major features are missing, though: I didn’t see any way to control where the customer lands after completing their order. That’s a major deficiency when compared to PayPal. And there didn’t seem to be any way to integrate shipping into the process. I went to look at the Google Checkout Blog, but at the moment that site appeared down.”
    I have found this really cool tool..
    http://www.googlecheckoutsecrets.com/button.html
    It allows you to do just what you said is missing…
    It allows you to set up a “return page” ASKA(Thank-you page)
    It allows for you to select the shipping/handling option.
    Also, after you try their script (for free) you can order their system which has alot of really good Video tutorials for the system, an easy to understand guide for the whole process including an account on how to use their API.
    not bad for their $197 price tag.

  12. Jason Channing

    Jason Channing

    I went to http://checkout.google.com/ and got:
    This service is temporarily unavailable at this time. Please check back again in a moment.
    Maybe the service isn’t quite ready for prime time.

  13. The re-direct is crutial i think but in general the free sales with adwords could be very attractive to heavy adwords users. Maybe not something i’d use quite yet but defo something to keep a close eye on to see what direction they go next.

  14. Martin

    Martin

    Hello all,
    nice to see that some more people out there looking into Google Checkout.
    From a company like Google I was hopping to get the ultimate checkout function with highest security features available. However, the oposite is the case. This checkout is so bad, that no user should ever use it.
    I do have a google account and so I tried the checkout function by buying a DVD from buy.com.
    1) At buy.com I had a different shipping price than at Google Checkout
    2) I was not redirected to buy.com and just stuck on the Google page….very strange that not even buy.com is using the feature to link back to the buy.com page and letting you know that the order is in process.
    Now, I went to another merchant to try the Checkout function. I got a server error when clicking on Google Checkout…and tried another with the same error
    Finally I found another merchant with a working Google Checkout button. I bought a SD Card and logged on to Google Checkout. Before finalizing the process I went to my settings and changed the password WITH NO PROBLEMS OR ANY SECURITY QUESTION!!!
    I changed the shipping address and finalized the checkout and was again on this Google page just saying that I purchesed an item.
    Now, in case someone gets my username and password this person can log on, change the password AND I HAVE NO CLUE ABOUT IT, as the email of the password change goes to the gmail account that is hijacked. Now the hacker can use and buy anything he wants without my notice at all. How do I get my account back???
    I am sure that there will be many hijacking pages out there to get you Google account and as the site does not have ANY security feature at all (The most simple design ever) and not even a clear URL “checkout.google.com”, the user will have no idea if he/she is realy on Google Checkout or not as the URL could be something like “checkout.google.xxx.com”.
    I send a letter to one of the co founders but did not get anything back regarding all those issues. I mentioned that on the first page of Google Checkout they are saying that in case something goes wrong with your account you will be reimbursed. That alone tells you that not even Google is sure about hteir own security!!
    So, keep away from Google Checkout.
    Regards,
    Martin

  15. Matt

    Matt

    I have used google checkout twice now and I must say I am dissapointed. The ease of use and functionality is fine, it’s just that there is a huge wait time between google checkout and the merchant you are buying from. Twice now when using the google option the merchant did not even recieve my order until four days later. If you add this to standard ground shipping both of my oders took atleast 14 days to arrive. Not to mention that the google order number is completely different from the merchants order number making tracking almost impossible. In my opinion their is far to many questions google has to work out with the merchants but honestly I don’t think they will ever do so, the issues are to many and to widespread.

  16. owen

    owen

    UPDATE on Google Checkout. It’s december and these guys have no idea what they are doing. They took my order and just sat on it. The vendor couldn’t do aynthing, and i couldn’t order from someone else because i didn’t want to end up with two $600 cameras. I finally got the vendor to cancel the order and THEN they charged me $600. Google claims no responsibility for any part of the transaction and has been no help at all. so exactly what do they do???

  17. ddcyr40

    ddcyr40

    I signed up for the Google checkout mainly because of the $10 sign-up bonus. I was ordering a book, and with the bonus, it would have only cost around $3, so I figured why not. Well, I placed the order, which was through textbooksrus.com, went fine, I received the order today in the mail, and it Google was very quick to charge me the full price, and it has been over a week, with 5 emails sent to the, no responses, and no $10 sign-up bonus. I would not recommend AT ALL! Not worth the hassle. They’ve got some things to learn.

  18. Lis

    Lis

    I had the same experience as ddcyr40. No sign on bonus applied to my purchase, no reply to my emails. Never mind, I’d skip it.

  19. Jeff

    Jeff

    I signed up for Google Checkout and was to receive $10 off of my first purchase. Google refused to give me the bonus it offered. What a scam! Please advise other customers that PayPal may be the way to go.

  20. James

    James

    In my opinion Google Checkout is very young system and it can’t compete with PayPal at all right now. It has a lot of restrictions in its use and some strange policies of how you need to place their buttons is a little bit frustrating. So I think it’s better to use PayPal than Google for handling your orders.

  21. To follow up to the comments above… Most of the problems outlined above have now been fixed.
    If you search for paypal you will see the horror stories so I think we should all support google checkout so paypal gets some competition to sharpen them up!
    On of the brilliant benefits of google checkout is the benefits you get if you are an adwords user.

  22. Google Checkout has improved somewhat, but if you take a look at their forums, you still see people struggling with some fairly basic issues. Though PayPal and Google are the ones most actively promoting their services, Amazon Payments is, in my opinion, going to become a formidable presence. The rates are fair to the merchants and, due to the fact that are already 80 million Amazon Payments accounts (anyone who has ever purchased something from Amazon.com automatically has an account), it eliminates the need for consumers to have to sign up for yet another service; as several people point out above, this requirement, while seemingly minor, can create a significant barrier. As a developer who has recently integrated all three into a service for sending online invoices, we were pleasantly surprised with the ease of use. Still, both Google and PayPal have the advantage of momentum, so it will be interesting to see how this plays out.

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