Tuesday, May 19, 2009

SCLW- Penny Stocks - Wall Street Journal Blog

This was just released this morning on the www.WSJ.com (Wall Street Journal).

Letting Web-Savvy Kids “Bill My Parents”

Internet companies are trying to come up with a solution for one of the classic headaches of parenting: kids begging for money.

On Monday, a service called “Bill My Parents” launched to allow kids to virtually send online purchases to parents for approval and payment — instead of asking mom and dad for their credit cards.

The service, operated by San Diego-based Socialwise Inc., aspires to remove some of the hurdles that currently keep kids from buying things online. The company points to research by Harris Interactive, which says that American teens and tweens spend $40 billion annually on purchases that they researched online but purchased offline, at least partly because they didn’t have any way to complete the purchase online.

Bill My Parents works in a manner that will be familiar to employees of large companies that use online expense tracking systems. Kids will find something they want to buy online, but instead of going through a traditional credit card-based payment system, they click a “bill my parents” button, which sends an email about the potential purchase to a selected parent. If the parent approves the purchase, the parent will be billed for the purchase to his or her own credit card. “It automates a process that already exists and is tedious,” says Bill My Parents CEO James Collas.

For now, the service works just for purchases on Amazon.com — and only through a special “Bill My Parents” shop for the site, which you can find here. But Collas says that he’s gotten interest from a number of sites to integrate a “bill my parents” button right into regular e-commerce sites and into online games. Eventually, he also plans to connect the service into social networking sites, and unveil a service so kids can collect and spend allowances and cash gifts through the online service.

The company makes money by charging a 3% to 5% commission to a merchant for a sale, and also charging parents 50 cents to complete a transaction.

There’s growing competition to make e-commerce easier for kids. EBay’s PayPal, which normally offers online payment services to people 18 and older, is currently testing a student account in the U.S. for children aged 13 and up. The service offers a subset of the features of its regular payment service, including use of its mobile application and the ability to receive a PayPal debit card. Some banks also already offer special debit cards for teenagers.

And Apple’s iTunes music store and some online game publishers long ago figured out the simplest strategy of all: sell gift cards at convenience stores that kids can redeem online. Even old fashioned cash allowances can pay for those.

No comments:

Post a Comment