Android Apps

Google Wallet & Google Offers: pay with your phone and get shopping deals. “Your phone will be your wallet”

May 26, 2011 | by Andrew Kameka

Finance

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Google raised the profile of near-field communications in the U.S. when it introduced the Nexus S last year. Google hopes to raise that profile – and profits – even further by launching a new NFC-based service that will pay for items using Android phones.

Google announced today Google Wallet, a contact-less payment solution that lets consumers pay for items with an NFC-enabled phone. To sweeten the pot, it also announced Google Offers, a location-based service that offers deals and discounts like Groupon or LivingSocial.

Wallet is Google’s attempt to popularize NFC payments, which most Americans typically see only at gas stations. But by using Android phones with NFC and partnering with major retailers, contactless payments should become more commonplace. In addition to the register that handles traditional cash and credit/debit card purchases, consumers at participating stores can put a Nexus S on top of a receiver and make a payment. American Eagle Outfitters, The Container Store, Macy’s, and Subway are among the retailers participating in the Google Wallet launch.

Here are some important notes on Wallet:

  • Wallet will debut this summer, but a field-test is already under way in New York and San Francisco.
  • Phones can pay through a Citi bank account, MasterCard PayPass, or a prepaid Google card.
  • The app requires security through a PIN and credit card encryption. Data cannot be sniffed because information is stored securely until unlocked and fully active.
  • Rewards card information is stored electronically and automatically processes at purchase (Buy a product at Macy’s and your Macy’s Reward account is credited instantly).

Google Offers is similar to Foursquare Deals and Groupon discounts because it offers incentives for users to shop at certain businesses. Offers are delivered through Ads, Check-ins, and Search. When someone searches for Mexican food, an ad in the search result might say “10% off if you eat Ernesto’s.” That same deal might be available when someone reads Ernesto’s Google Places page; consumers may even get a free appetizer when they check-in at Places. Offers are also available when searching Google on the desktop, and can “Save to Wallet” to have the deal readily available when paying in-store.

Google Offers will be tightly-integrated into Google Wallet and will also be available in field-tests in select markets. New York, Portland, and San Francisco will be the first cities that support the program. You may also see advertisements in these cities that offers built into them through NFC tags.

CONCLUSION

Google diving head-first into near field communications should surprise no one. “How to NFC” was a popular development session at Google IO 2011, Executive Chairman Eric Schmidt said that the technology would be important to the company’s mobile strategy, and Google has already encouraged companies to beef up their NFC credentials. This new service allows Google promote NFC adoption and become a player in the mobile payment industry that is already processing more than $170 billion dollars each year. It now makes sense why the company supposedly offered more than $6 billion to acquire deals site Groupon.

Get more information on Google Wallet here. To learn more about how near field communications (NFC) works and possible use cases, read Androinica’s previous coverage on NFC here and here.