Jupiter: Young Consumers Demand Online Payment Options
May 24th, 2007  by Jennifer LeClaire

Interested in boosting your conversion rate? While using Paypal traditionally hasn’t been the best option, it may work out just fine if your target market is under 35. Web analytics, of course, can help you test the theory for yourself. After all, whatever works, right? If I told you Paypal could increase your conversion rate by 2 percentage points, you’d jump on the online payment bandwagon in a hurry, right? It just might.

JupiterResearch says younger consumers (those under 35 years of age) are evolving very different payment and content consumption habits from adults over 35. In a new report entitled, “Payment Preferences Online: Managing the Generation Gap Between Mature and Young Adults,” JupiterResearch found that younger adults are driving much of the usage of PayPal and debit cards for online purchases, product preferences which are helping to drive the marked differences in payment habits that exist between younger adults and baby boomers.

According to the study, 48 percent of consumers ages 25 to 34 prefer debit cards for Internet transactions, as compared to only 39 percent of all online consumers. Thirty-four percent of online consumers ages 18 to 24 prefer PayPal or similar services versus 27 percent of all online consumers.

“As younger adults expand in proportion to the workforce, their earnings and overall capacity to purchase will also increase. This will solidify the most durable of their different payment preferences, “said Edward Kountz, Senior Analyst at JupiterResearch. “This trend will require payment-product issuers to develop marketing and product strategies to meet the payment desires and changing values of younger adults. This will include card features tailored to younger adults’ lifestyle needs, and marketing efforts that embrace emerging social media.”