Christmas-Tree Lots Push Square Past 1 Million Customer Mark

Posted by: Rachael King on December 13, 2011

By Danielle Kucera

Christmas-tree farmers like Joe and Kay Gersch helped push Square Inc. past the one-million merchant customer mark in time for the yearend holidays.

Square, the mobile-payments provider created by Twitter Inc. co-founder Jack Dorsey, reached the milestone last week.

Small businesses like Yawn Station Christmas Tree Farm , located in Independence, Louisiana, are crucial to helping Square compete in the market for mobile payments, which may exceed $170 billion by 2015, compared with an estimated $60 billion this year, according to Juniper Research. The company is vying with companies such as EBay Inc.’s PayPal, which has 103 million users and also is encouraging shoppers to use smartphones to buy through its payments network.

Square’s technology lets businesses handle payments via Apple Inc.’s iPhone and iPad, as well as devices running on Google Inc.’s Android software. The card reader plugs into the headphone jack of the mobile device and lets merchants swipe customers’ credit and debit cards.

The ability to take credit cards has increased sales by about 40 percent at Yawn Station Christmas Tree Farm, Joe Gersch said. “If everyone came and paid with credit or debit it would save me money, because it would cost me less than I pay in gas to go to the bank and deliver the deposits,” he said. “Most of my older customers already knew I only accepted cash or check, so the people that I’ve already used Square with have been new.”

Square is targeting small businesses that may not be able to afford traditional machinery that handles credit cards, Chief Operating Officer Keith Rabois has said. Gersch, 65, had to buy his first smartphone to operate the card reader. He signed up for the service about three weeks ago after Square called and pitched its service, he said.

Customers who visit Yawn Station sometimes spend the whole day at the farm, picking a tree and chopping it down themselves. Before now, someone without cash would have to drive 20 miles to the nearest automated teller machine before they bought a tree or any of the add-ons the farm offers - wreaths, for instance, or a horse-drawn carriage ride, Gersch said.

The sales will help Yawn Station sell 1,000 to 1,200 trees this season at an average $55 to $60 apiece, more than the 800 it sold last year, Gersch said. “Customers don’t realize I work 365 days a year to provide that tree,” said Gersch, whose farm has about 7,000 trees. “We’re trying to provide an entire experience when you come here.”

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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