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Expect PayPal to Continue Their Focus on Millennials and Gen Z

Millennial Magazine - paypal

PayPal has long been regarded as one of the best ways to complete online transactions, and with the launch of their new cryptocurrency arm at the start of the second quarter a lot of investors were interested to see how PayPal performed in Q3. While the platform’s revenue was down slightly against what was predicted ($6.18 billion vs. the predicted $6.23 billion), the earnings per share were up on the predicted value.

Who Uses PayPal The Most?

What’s most interesting is what happened to the user base. The fall in revenue, while disappointing for investors, doesn’t necessarily point to a company in trouble, but more one that’s in transition.

While PayPal have kept quiet on their target user base, it’s not hard to see where their focus is when you think about the kind of services they’ve launched and the companies that they’ve acquired along the way.

Cryptocurrency has been a hotly discussed topic, particularly among Millennials and Gen Z who have grown up with the internet and turn to it for everything from shopping to a job. The younger generations have very much made use of what’s available to them and for some trading cryptocurrency has become a job.

You don’t have to look far to find a story of a millennial that’s made it big from trading crypto and it’s got a lot of others interested that aren’t as confident. A big brand like PayPal jumping into the crypto space gives nervous onlookers a way to dip their toe in and see what happens.

What Has PayPal Done to Grow Their Market Share?

PayPal’s crusade to capture the younger generations doesn’t stop at the PayPal platform either. Since PayPal acquired Venmo in 2013 they’ve taken it from strength to strength. Venmo is a P2P payment app that’s similar to PayPal but is often more associated with Millennials and Gen Z.

Venmo recorded over 50 million active accounts in 2019 with 7 million of those belonging to users aged 18-34. A big part of the Venmo experience is that the platform has more of a relaxed feel with the use of emojis being a big part of the app. The brand even released statistics on emoji use by consumers – the most popular emoji was a taco in case you were curious! This continues to echo PayPal’s drive to personalize payments.

The Relationship Between PayPal and Cryptocurrency

When PayPal launched their cryptocurrency service, Venmo played a big role in the promotion of crypto and the PayPal platform as a whole to Venmo’s younger user base. The company ran a Cash Back to Crypto program which they recently expanded to UK users. The Cash Back to Crypto campaign is a feature of the Venmo credit card.

Whenever users complete a transaction with their Venmo credit card they earn cashback, which can then be automatically used to buy one of four Cryptocurrencies. The cryptocurrency app has so far been a success for PayPal, leading to a 15% increase in first-time users transacting with crypto, as well as a 35% lift in cash card enrollments.

The rollout of cryptocurrency and integration with the PayPal platform has been a success, particularly in terms of capturing more Millennial and Gen Z users and the features that PayPal continue to bring out suggest that they’re going to continue targeting the younger generations as they move forward. Features like allowing users to split a bill or cab fare with other PayPal users is something that very subtly targets millennials.

On top of this, PayPal has continued to push their support for small businesses with incentives and support programs for business owners that use PayPal. While anyone can run a small business, recent years have seen a huge surge in the “side hustle culture” and remote working – something particularly popular with younger generations – and PayPal claims to make it very easy to run a business through their platform.

Has This Been Successful?

With the success of the cryptocurrency program so far, the launch of small business tools, the ability to split bills with other users and the huge success that PayPal has turned Venmo into, there’s no doubt that PayPal are targeting Millennials and Gen Z. Younger generations spend a huge amount of time and money online and a large portion of the population have developed an interest in crypto – so it makes sense as to why PayPal are targeting this age range and we shouldn’t expect to see this shift any time soon.

The fact that PayPal has built itself up to be such a huge brand means that any company that is serious about carving out its own eCommerce space needs to have PayPal as a payment option. Industries keen to integrate their platform with PayPal includes iGaming – this list of PayPal casinos at Compare.bet shows how many operators have integrated their services.

Who Is The Future Customer Base for PayPal?

It is hard to reliably predict any trends for future generations, especially when it comes to finances. However, what we do know is that Gen Z is already growing up well aware of facilities such as in-app purchases, microtransactions and the option to invest in things like digital currency. It stands to reason that the generation that comes after them will be even more open-minded to this type of spending and that is something that all industries will need to get to grips with if they want to ensure their success.

Shopping online, playing games online and even working remotely is something that the youth of today are growing up with as being the norm. For companies to capture their business in the future they are going to need to make sure they embrace technology and offer everything that this generation and their children are going to want in the future – and that is most definitely going to be the integration of e-wallet providers such as PayPal to make shopping as simple and quick as possible.

What do you think?

Written by Trueman

Trueman is a fin-tech and culture writer for Millennial Magazine. As host of The TrueMan Show, he covers all things related to stocks, tech and culture. He's a market analyst by day and a talent scout by night, combing the Internet for noteworthy startups, influencers and culture warriors.

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