BRENTWOOD, Tenn. -- Emphasizing security priorities and PayPal's history as a payments-focused entity, officials at Mapco detailed their decision to use the mobile-wallet provider as a solution in its loyalty application.
In a deal that tentatively bypasses the current Apple Pay versus MCX (Merchant Customer Exchange) debate, the 276-store retailer described planning its mobile-payments strategy more intently starting about two years ago, when the overall landscape was still a question.
"We couldn't pick a pony at that point, but we needed to make a decision as to how to fill that need," said Howard Curtis, brand and marketing leader at Mapco, Brentwood, Tenn. "PayPal had the most credibility with the consumer--15-plus years. They had a presence in the mobile space, and we felt comfortable with their highly recognizable name."
San Jose, Calif.-based PayPal and Mapco beta tested the payments option in its "MY MAPCO" app starting this past May, and since has reported "a consistent increase" in the number of recurring customers using the app to pay for gas.
Its decision comes at a time when retailers are taking sides on the use of Cupertino, Calif.-based Apple Pay versus a merchant-lead solution from Needham, Mass.-based MCX.
In an interview with CSP Daily News, Curtis said other mobile-wallet options were problematic. For instance, with Apple Pay, its built-in near-field communications (NFC) technology would have required costly upgrades to point-of-sale (POS) registers and dispensers.
Then, in terms of mobile-payment models where customers gave access to their bank accounts, Curtis said it was a level of complexity and data security they weren't comfortable with.
With the PayPal option, customers can still use a credit card, but PayPal works with clients like Mapco to calculate an interchange solution that remains at a certain level no matter what payment tool a customer chooses, said Chris Morse, head of merchant communications from PayPal.
With that analysis, Mapco assessed the cheaper interchange with automated clearinghouse (ACH) transactions against the number of debit transactions they did, as well as incorporating other factors, to feel confident about the PayPal decision.
For the customer, the payment experience starts after he or she downloads the MY MAPCO app. When that's done, the PayPal option appears. They have to walk through the process of getting a PayPal account if they don't have one, but once complete, they can initiate purchases from their phone. The payment activates the pump and allows fueling.
People with PayPal wallets can also use the service at retailers outside of Mapco, but it resides in the app as a service to Mapco customers.
It also allows Mapco customers access to rewards. For instance, during this past weekend—the high-traffic weekend before Thanksgiving--customers visiting a couple of Nashville, Tenn.-area sites could receive $1 per gallon off their purchase during a window of a few hours. Beyond the special promotion, app users can get five cents per gallon off, compliments of Mapco and PayPal.
"We understood that to win in loyalty, we needed to speak to our customers in a way that they're listening," Curtis said. "We needed to be more appealing and relevant to them."
Mapco Express is a wholly owned subsidiary of Delek US Holdings Inc. Based in Brentwood, Tenn., it operates convenience stores in seven states under the Mapco Express, Mapco Mart, East Coast, Discount Food Mart, Fast Food & Fuel, Delta Express and Favorite Markets brand names.
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