PayPal acquired the shopping platform Honey for US$4 billion, making the largest acquisition of a tech company in LA history.
Honey Science Corporation is a web browser add-on and also a mobile app that tracks sales and offers consumers discount codes to many online retailers. The extension is very useful as it provides customers with the promo codes that give the best savings.
Last year, the shopping platform publicly announced that its 100 million members had saved over US$800 million. As of today, Honey’s members have saved more than US$2 billion.
The acquisition will give PayPal a very big advantage in the customer’s shopping journey. It comes as PayPal is facing increased competition from tech companies such as Apple, Google and Facebook and direct competitors like Visa (V) and Mastercard (MA), which are expanding their online payment offerings.
“The combination of Honey’s complementary consumer products with our platform will significantly enhance our ability to drive engagement and play a more meaningful role in the daily lives of our consumers. As a partner of choice for our merchants, this is another way that we can help them build and strengthen their customer relationships, provide personalised offers, and drive incremental sales. The combination of Honey and PayPal adds another significant and meaningful dimension to our two-sided platform,” said Dan Schulman, president and CEO of PayPal.
Both PayPal and Honey are dreaming about building a powerful new online shopping experience for consumers and merchants and providing their users with more value.
We’ll see how this one goes once the ‘honeymoon’ phase is over.