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Google Checkout Fees Now Identical to PayPal

The free lunch is gone!



6:35 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

Google Checkout will increase their fees to the EXACT same structure as PayPal, beginning May 5, 2009:


for reference, here are PayPal's fees:


Interestingly, since PayPal offers an eCheck option, limited to $5 per transaction, max, customers spending over about $250 by eCheck make PayPal the cheaper option for the vendor.

And the Google-waived fees for related AdWords spends are now totally gone.


7:14 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

Was nice while it lasted.

I imagine we'll remove it as a payment method in May. I never really liked how they forced you to integrate it, anyway.


7:17 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

I moved away from paypal as Checkout Fees were cheaper. Now I'll go back to offering both options. I think this is a premature move for G - at least here in the UK. Don't know about elsewhere but I think here in the UK the average business and the average punter are more familiar with Paypal and are happier to pay by Paypal. There is now no incentive for businesses to favour Checkout. Paypal will be laughing right now.


7:27 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

Right - for me, it's one more point of confusion and maintenance and a potential to redirect customers elsewhere. Plus, it gives them the option to opt-out of marketing emails, which I don't see as a positive for my company.

I'm pretty sure we'll drop them on 5/5 also. If we hear from customers that this is an issue, maybe we'll reconsider, but I doubt it.

Frankly, since GC and PayPal now use the same tiered pricing, financially, I should only take one so that I can try to get as many of these off-site payments into the same basket and get the best tier. So, of course, I'll go with the one with more sales currently. That's PayPal, hands-down.

I wonder if PayPal will be the big winner here. They're probably pretty happy with this news.


7:33 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

This doesn't seem like a well thought-out move on Google's part. Because of the low fee's we've actively pushed Checkout as our preferred payment method, but now that will end.

I can't imagine many of our customers using it at all after we stop pushing it. In fact, we may even remove it because my primary CC processor fee's are actually lower than the new Google fees.


11:14 pm on Mar 11, 2009 (gmt 0)

10+ Year Member

Well, they may figure that they bought their market share, and now they want to let it run and try to reap some profit from it.

Sounds like, as a whole, they'll be losing some vendors.

Anyone plan to keep it?


11:37 am on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member 5+ Year Member

We still will offer it, but it will not be our first "go to check out" button we display.

Currently we pay much lower rates with autorize plus their customer service is better.


12:00 pm on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member Top Contributors Of The Month

The only advantage they had was cheaper fees and AdWords bonuses.

The way they force you to have their "buy with Google Checkout" buttons under your own Add to Basket buttons is ridiculous. It is hard enough getting people to order without having two different buttons to purchase.

I have offered for some time as an alternative payment method (like PayPal) but have only had a very limited number of orders. Less than 0.1% have chosen it.


2:03 pm on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member encyclo is a WebmasterWorld Top Contributor of All Time 10+ Year Member

Google Checkout fees in 2009 [googlecheckout.blogspot.com]
Now in our third year of helping merchants increase sales and attract user interest, we're announcing the decision to move from our previous standard fee schedule to a new tiered pricing model where rates decrease as merchants process more transactions through Checkout.


2:04 pm on Mar 12, 2009 (gmt 0)

10+ Year Member

I can't wait to be done with the 15 minute holding period.

Also, we have pick-up customers who place big orders and drive over. But sometimes we get stuck where they arrive before their order is chargeable. No more!


2:05 pm on Mar 12, 2009 (gmt 0)

10+ Year Member

encylo - that quote is great, because it carefully sidesteps the fact that, to 99% of merchants, this is a price increase.

Probably only 1% of merchants can see a potential decrease in prices here, and even so, it will be minimal.

But they make sure to use the term "rates decrease" in there, in a very misleading way.


3:32 pm on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member vincevincevince is a WebmasterWorld Top Contributor of All Time 10+ Year Member

We will be dropping it.


6:09 pm on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member 5+ Year Member Top Contributors Of The Month

Is anyone worried that dropping Google Checkout will hurt CTR because you will no longer have the Google Checkout icon next to your ad? I fear dropping this icon will lower CTR and raise CPC prices. For me, it sounds like it makes sense to keep it for that reason and because very few customers use Google Checkout so our fees won't go up much.

Also I thought I was reading recently that people think that having Google Checkout is helping people with Froogle/Google Base. That is something we also do not want to potentially jeopardize.


6:13 pm on Mar 12, 2009 (gmt 0)

10+ Year Member Top Contributors Of The Month

I'm surprised they've done this. I rejected them as a payment option last month after spending time reading through their terms, and looking at feedback from other merchants. And that was despite price being a major consideration for me.

Mind you, I'd still have rejected them at the proposed rates, so maybe they have some logic there. :)


6:36 pm on Mar 12, 2009 (gmt 0)

5+ Year Member

Theres now basically no good reason to use Google checkout. Paypal always produced the best ROI for me anyhow.


8:45 pm on Mar 12, 2009 (gmt 0)

5+ Year Member

We will not use them as an option anymore either - the fee-free period was the only draw for us.


8:59 pm on Mar 12, 2009 (gmt 0)

10+ Year Member

It doesn't seem to be a wise move just yet, at least in the UK. Most of our customers have never even heard of Google Checkout, but a good percentage have heard of PayPal.

We probably take four or five times as many orders through PayPal than we do with Google, and the ones do process through Checkout are usually higher value customers that have been 'gently persuaded' to use it so we can take advantage of the cheaper processing.

So we've now got the option of either:
a) Leaving Google Checkout as a payment option and offering the customers a choice of payment methods.
b) Removing GC totally and trying to move into a more profitable tier with PayPal.

Got until May to decide that anyway.

Is there perhaps something else going on here? Are Google avoiding potential accusations of anti-competitive behaviour? Or maybe there's a deal with eBay that would involve seeing GC on eBay? Or maybe it is just Google trying to get some money back on a loss making service.


9:10 pm on Mar 12, 2009 (gmt 0)

10+ Year Member

I agree that I would have expected Google Checkout to become more entrenched and ubiquitous before they raised prices like this. But if anyone remembers the $X off $Y promotions, as they progressed, they got substantially worse. I think the last one we did was $10 off maybe $60, and we ate $8 of it, and they ate $2. So if $2 was the cost of a customer acquisition, they were doing pretty well by that point.


10:28 pm on Mar 12, 2009 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

Bad move by Google. We used this extensively. Now we will be moving back to Paypal. Checkout has pretty limited features. There is no Virtual terminal option.

But it was good while it lasted. Saved few thousand dollars every month (in processing fees ) for last 18 months :)


10:53 pm on Mar 12, 2009 (gmt 0)

I hope Paypal won't increase their prices now..


7:55 am on Mar 13, 2009 (gmt 0)

WebmasterWorld Senior Member 5+ Year Member

Somehow I don't think Paypal will raise prices. eBay owns paypal and they've been enjoying some new perks recently.

Namely: Yahoo! is getting out of the auction website business in the UK and has begun promoting ebay on their homepage (you've seen it if you've been shown the upcoming Yahoo! templates in advance).

Yahoo! is now an ebay affiliate, all the ebay links on the upcoming yahoo homepage are affiliate rover links complete with a new tool for their email users to track ebay.

Search and auction seem to be headed for friendship imo. Paypal is part of that. Perhaps Google has seen the new eBay yahoo! partnership and is aligning themselves because of it?

[edited by: JS_Harris at 7:56 am (utc) on Mar. 13, 2009]


9:45 am on Mar 13, 2009 (gmt 0)

10+ Year Member

I thought being cheaper than Paypal was their USP. Doesn't look like they have one anymore.

I guess the gap in the market is for a payment provider with customer support!


12:33 pm on Mar 13, 2009 (gmt 0)

5+ Year Member

Does Google Checkout works in Asia, especially in Singapore? Paypal Singapore supports money withdrawal option for both checking Bank a/c or credit card.


3:29 pm on Mar 13, 2009 (gmt 0)

10+ Year Member

GC is only available in US. Maybe they plan to go worldwide?


3:51 pm on Mar 13, 2009 (gmt 0)

5+ Year Member

Too bad...I will stick to Paypal.


4:21 pm on Mar 13, 2009 (gmt 0)

10+ Year Member

eBay did rule out Google Checkout as an official method to pay for auctions, but in general, I really don't think PayPal sees Google Checkout as a threat. And, especially now, PayPal probably couldn't care less.


9:14 pm on Mar 13, 2009 (gmt 0)

10+ Year Member

"GC is only available in US. Maybe they plan to go worldwide? "

It's available in UK


1:06 am on Mar 14, 2009 (gmt 0)

WebmasterWorld Senior Member 10+ Year Member

Ultimately, I'm sure they approximated the anticipated bell-curve of drop-off vs increased revenue through increased rates and saw that they would benefit. We'll have to wait and see if their math works out, but let's face it... outside of search they haven't been all that stellar.

I don't use GC but I do have a question... how are chargebacks? Maybe the higher cost is a premium to counter the costs associated with having a large amount of chargebacks?


6:40 am on Mar 14, 2009 (gmt 0)

5+ Year Member


Keep an eye on your individual orders. I don't suggest shipping orders that are not flagged by "Covered by Payment Guarantee". Most are, some may not be.

Watch out for "reserves". Obviously, this is a separate account that is held for future chargebacks. Try no to let this reserve get to high. A google rep informed me that an account has to be closed for 6 months to recover the funds. The reserve does not incur interest. To the best of my knowledge, refunds and chargebacks are initially deducted from unpayed payouts anyway.

As far as the fees, I saw this coming months ago when PayPal sent me an update of their terms. I believe I actually had to sign off on this one. I saw the bank Wells Fargo in their terms. Wells Fargo, I believe owns, First Data at least that's what my USBank banker blushingly told me when I informed him I signed up with First Data. He could be wrong.

I have no problem with Wells, First Data, Paymentech or their alliances with other companies like Google or PayPal but if you Google "First Data Paymentech Wells Fargo" or even "First Data Paymentech" you may see a pattern. I believe things are just normalizing now. I thought this would actually happen around 1/1/09.


9:49 pm on Mar 14, 2009 (gmt 0)

10+ Year Member

Re Chargebacks:

We only had one with them, and they really couldn't have done a worse job on our behalf. They basically gave the money back even without demanding a return of the merchandise. It was a complete joke - they were clearly novices in this area.

Unfortunately, when middlemen have to deal with chargebacks, they just don't care. It's not in their financial interests to care either way, just to spend as little time as possible.

PayPal, at least, has established rules and knowledgeable personnel. Google was really nothing more than some auto-reply emails that didn't apply to our situation.

The more I think about the problems I've overlooked for the free processing, the more I'll be glad to be done.

For example, have you ever tried to reconcile their fees? They get assessed and then somehow credited back into the previous day's batch. Further, they don't take back the free processing on credits, so you actually make money on credits if the original charge came under your free umbrella.

I hadn't really thought about it, but the poster who said that outside of search, Google hasn't been that stellar, really had it right. This is a mess, and I'll be glad to be done with it, even in spite of the few hundred a month I'm currently saving on it.

This 42 message thread spans 2 pages: 42

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