The collapse of a successful company
Paypal for many years has been known as the main payment gateway for electronic commerce, even by looking at the news you can verify this, seeing the overwhelming number of businesses that use paypal, but, when examining the historic on the stock market , a surprising trend will be seen, with up to 61% loss, what will be happening?
Paypal’s revolution in electronic commerce
Trade in the traditional way was strongly restricted by regions, areas, or even just cities, since transferring money from A to B was a really complicated process, even with the traditional banking system, credit cards and even ATMs. Businesses still depended on infrastructure, investments and customers who were willing to have those options to pay.
That is why, when electronic commerce emerged, with better payment methods, such as paypal, it revolutionized the industry, now people could do business, buy and sell, without having many financial notions or even being strictly related to the system. banking, it was enough to have an email, ask for donations, a world of options opened up.
That’s where Paypal was able to stay king, by being innovative, and flexible, at least enough, for a large number of people to buy services or products through their payment gateway.
For the first time, businesses could effectively sell anywhere in the world, buy and sell to anyone, at least in theory.
Paypal vs the competition
In a world that is highly competitive, it was expected that Paypal would have strong competition, a large number of payment gateways began to be created, some even depending on blockchain technology. This caused the real explosion in electronic commerce to exist, since, although Paypal was a good alternative, it was not the solution for everyone, nor for all situations. Some businesses were totally restricted from doing any activity within their payment gateway, restrictions by geographic location, etc. This benefited both the client and the business, however, as there were a greater number of options, Paypal began to be severely affected.
Paypal making bad decisions
In an attempt to continue having the trust of both customers and businesses, Paypal began to implement measures that were aimed at increasing that degree of trust, since trust is key to any business, especially when it comes to electronic commerce. . However, the measures used by Paypal were completely counterproductive, in an attempt to support transactions, it took very severe measures against businesses, such as account freezing, false refund accusations, extremely high fees, and payment failures. Paypal’s idea was to be rigid and strict with businesses to avoid scams, thereby encouraging customers to make safe purchases. However, that strategy ended up collapsing many businesses, leading many businesses to bankruptcy.
This motivated businesses to look for other payment gateways that were much friendlier with their business model, an example of this can be seen with Ebay, in September 2021, in the face of several reports of abuse, the e-commerce platform Ebay decided to stop accepting Paypal as a payment method, which is clearly marked in the history, starting a drop in the value of Paypal shares.
Wrong damage control
In an emergency, it is necessary to take measures that continue to worsen the situation in question, in the case of Paypal, the flight of capital, users and trust in the brand, however, in an attempt to recover that lost capital, Paypal came to give warnings to its users, basically, indicating that Paypal would freeze the accounts of users who had certain behaviors through publications on social networks. This created a lot of controversy, Paypal denied having pushed this rule, however, the damage was already done, with a large number of articles, videos and notes, criticizing the brand, which would harm the confidence to carry out transactions.
In an attempt by Paypal to try to recover from a sharp drop, it was now even accelerating its slide to the bottom.
To this day, advertising will say that Paypal is still the King within payment gateways, which is partially true, last Black Friday, 34% of digital transactions were made through Paypal and Venmo (somewhat which surprises many to understand that Venmo belongs to Paypal). However, behind those beautiful reflectors, when reviewing the history, paypal since leaving Ebay, has lost the value of its shares by up to 61%, and this is extremely difficult to reverse.
Paypal is likely controlled by investors who are only looking to squeeze every penny out of the company and then sell it for junk.
If Paypal were not controlled by jackals, the board would seek to improve its service, especially when there are so many options on the market, such as Apple Pay, Google Pay, ClearPay, Klarna, etc.
Today, electronic commerce is more accessible to the average person, which is why many use PayPal as their first option, but those who have been in this niche for some time will know that there are better options than PayPal.
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