Online marketplace eBay will now accept payments from Venmo, the second most popular U.S. payments platform, in a strategic move to attract younger consumers. In 2023, Venmo boasted 90 million users, with 28% of them falling within the sought-after 18 to 29 age group.
eBay expects the addition of Venmo will lead to more sales and less abandoned carts. Approximately 60% of eBay’s volume originates from mobile devices, making this a logical step in its initiative to attract digital natives.
“The ability to pay with Venmo at checkout continues eBay’s push toward tapping into a younger demographic with Venmo’s heavy adoption among Gen Z and Millennials,” eBay noted. “In addition to Venmo, buyers on eBay have the option to pay with a breadth of popular and relevant payment methods…including major credit and debit cards, digital wallets, and BNPL.”
Building Awareness
The move follows eBay’s announcement that it would discontinue American Express payments in August. One reason for moving away from Amex is because of the credit card company’s “unacceptably high” transaction fees.
Another reason was the growing popularity of alternative payment methods. Customers have begun to gravitate towards digital wallets because they support payments by bank account, credit card, or account balance.
Digital wallets can also be more convenient; in eBay transactions, Venmo users won’t have to continually enter their payment details for each purchase. After a transaction, users can share their eBay purchase on their Venmo feed. eBay hopes this social aspect will build awareness of both its sellers and its marketplace.
Winning Endorsement
The recent news is a win for Venmo after Amazon dropped the payments platform in December. The e-commerce giant never gave a clear reason for moving away from Venmo, but there was speculation that Amazon customers simply didn’t use the payments platform enough.
There are still two million businesses that support Venmo, including Starbucks, Hulu, and Doordash. While the integration into eBay won’t change anything for seller, consumers will see the option to pay with Venmo starting next week.