New smartphone updates from Google include a contactless payment system, more consumer privacy control with apps and the widely rumored Buy button.

Google Inc. is matching Apple Pay with Android Pay, adding mobile privacy controls that could adversely impact marketers and making it easier for mobile shoppers to buy directly from a Buy button on search ads displayed on smartphones. The search engine company announced the mobile innovations today at its annual I/O conference for  software developers.

Mobile developers can now begin to build on Android’s latest release, M, which will be available for consumers in Q 3, said Dave Burke, Google’s vice president of engineering, in a keynote address at the conference.

M includes Android Pay, a contactless mobile payment platform that uses Near Field Communication to allow consumers to check out quickly in store or on the mobile web. With Android Pay, a consumer unlocks his smartphone, taps it to an in-store NFC terminal and then receives a confirmation message. Consumers can pay with Android Pay at locations that have NFC checkout-terminals, which includes 700,000 U.S. physical stores, Burke says. Once a consumer sets up an Android Pay account, he can also pay in-app on the device by tapping the Android Pay button.

Developers can also incorporate fingerprint authentication into Android Pay in apps. For example, Burke recently used the feature to make a purchase via an upcoming version of Target Corp.’s app, set to release later this year. Burke found a product he wanted to purchase, tapped Android Pay and used his fingerprint to pay.

With the new software release, Google also is changing how consumer privacy permissions work in an app. Currently, when a consumer downloads an app in Google Play, she sees a list of items the app wants access to. For example, both the Groupon and Macy’s Android apps ask for access to a consumer’s location, photos/media/files, camera, device ID and call information. Either the consumer accepts and downloads the app, or the consumer cannot download the app.


With M, a consumer will download an app in Google Play without granting any permissions. The app will ask a consumer’s permission on a case-by-case basis. For example, the messaging app WhatsApp Inc. will ask the consumer for access to the microphone if the consumer wants to send a voice message. 

“You don’t have to agree to a permission that doesn’t make sense to you,” Burke says.

The privacy controls could impact mobile marketers, including retailers, who use consumer data and access to features on smartphones to provide targeted offers, advertisements and other app functionality. For example, a bar code scanner in an app must be able to access a consumer’s smartphone camera, and push notifications and beacons use a shopper’s location to send offers to her when she is near a store.

A Google spokeswoman also confirmed today it its working on enabling consumers to purchase directly from smartphone ads on Google, by adding a Buy button.


The Buy button would appear next to ads on the search results pages that Google presents to smartphone users. Google would host the checkout page, and clicking the Buy button next to the ad would let a shopper complete a purchase without ever leaving Google, according to several reports.

Retailers and brands should watch the buy button closely and examine the opportunities and also the downsides it presents, industry experts say.

“Our experience shows that early adopters of Google’s Product Listing Ads gained an early and sustainable lead, and we think this change has the potential to further separate the leaders from the laggards,” ChannelAdvisor Corp., an e-commerce marketing services provider, writes in a blog post. Product Listing Ads are the listings that appear prominently in Google search results for product-related searches, showing the product’s image, price, the retailer selling it and other information.

Brian Esposito, CEO of cosmetic retailer AVEYOU Beauty Boutique, predicts the Buy button will increase the amount of revenue it receives from its Google smartphone ads.


“This will dramatically reduce noise, friction, and increase the comfortability for our mobile online shoppers,” Esposito says.

The Buy button may benefit retailers by making it easier for consumers to quickly search and check out on a smartphone, agrees Brian Klais, founder and president of mobile marketing and mobile search engine optimization firm Pure Oxygen Labs But, he says, retailers may have to give up merchandising control and upselling opportunities, such as the retailer showing the customer related products, which could lead to smaller cart sizes.

Rett Clevenger, CEO at, a daily deal retailer, agrees that the Buy button could have some limitations for his business.

“This has the ability to increase the volume of products we sell through transactional customers, but does nothing to help build our brand awareness or acquire new loyal customers,” he says.


Overall, Clevenger believes the Buy button will increase the revenue receives via Google, but won’t be valuable for products that have high consideration because of limited content space.

Still, even if consumers are buying direct from Google without visiting the retailer, that doesn’t necessity mean a retailer’s traffic will fall, says Will Martin-Gill, senior vice president of product for search marketing firm Kenshoo. The Google Buy button could bring a retailer more exposure, he says.


Follow mobile business journalist April Dahlquist, associate editor, mobile, at Internet Retailer, at @MobileStrat360A.


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