Groupon Rebrands Mobile Payments Biz As Breadcrumb, Adds iPad Merchant App And A $5k No-Fee Deal To Bring On New Users

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A day after Groupon released (and then pulled) an iPad app with a new mobile payments dashboard for businesses, today the company is taking the wraps off a bigger piece of news around its larger plans to expand its commerce services for local merchants. Building on its Breadcrumb payments and commerce service for restaurants, which Groupon acquired last year, the company today is rebranding its wider payments service — and the final version of that free iPad app — under the same name.

The new iPad app for merchants of all stripes is called “Breadcrumb POS,” while the old Breadcrumb app for restaurants will now be called “Breacrumb Pro.” Both will be here when they go live on the app store.

Sound confusing for both to be called Breadcrumb? Streamlining names is usually meant to simplify things. Groupon says that in fact this is what is happening here: “As it turned out, when we spoke to merchants at salons and other retailers, they were fine with the name Breadcrumb,” says Mihir Shah, VP for Merchant OS at Groupon. “It was about how good are the rates, and the quality of the actual POS product and software.”

Indeed, it makes sense for Groupon to position like this, considering that the marketing play of targeting those who have never been able to process credit cards before is now a little me-too. “We’re not just targeting simple paymet solutions for those who didn’t take credit cards before,” says Shah. “We’re offering a better service to them.”

Both the app, and Groupon’s wider payment services — they also include the Groupon Merchants apps that sit on iPhone and Android handsets, which turn them into credit card readers — are U.S.-only for now. The company is still working on expanding this internationally to the 500,000 merchants it says already use Groupon’s platform for daily deals and other offers. As we noted yesterday, expanding payments services is part of the company’s bigger ambition to take its business beyond daily deals and into other revenue streams.

But, because Groupon is coming into the market of mobile payments and local commerce relatively late — Square, PayPal’s here and others have already been here for a while scooping up business – Groupon is being aggressive on both the rates it charges, and also in making the service as easy to integrate as possible into a business.

To attract new payments business from among the 100,000 merchants in the U.S. that already sell daily deals and other products through Groupon’s platform, as well as those merchants who do not, Groupon is targeting lower, and sometimes no, rates. Those who sign up now get the first $5,000 of payments processed through the service without being subject to any fees. After that, Groupon offers a guarantee that its fees are lower than any one else’s: Shah tells TechCrunch that Groupon will match its competitor’s rates if a merchant can submit proof of those rates being better.

Groupon charges merchants 1.8% on Visa, MasterCard and Discover swiped transactions, 2.3% when keyed in, plus $0.15 for each transaction. American Express pricing is more complicated as it is “determined by American Express based on your industry category.” The rates range from 2.3%-3.5% (swiped) and $0.00 to $0.15 per transaction, says Groupon. For non-Groupon Merchants, the fees are higher: 2.2% when MasterCard, Visa and Discover are swiped, plus $0.15 per transaction. As a point of comparison, Square has two options: a flat 2.75% fee per swipe, or $275 per month with no fees per swipe — with the latter aimed at higher-volume users, or those who like to gamble that they might be.

Groupon also says that it is halving the time for payment deposits to appear in a merchant account, to 24 hours from two to three days.

In addition to competitive commission and deposit rates, the company is also taking a leaf from its Breadcrumb launch last year and bundling the app with some of the physical hardware that will help people run it.

It calls this service the “Bread Box” and typical packages range in price from $246 (iPad stand, cash drawer, a reader dongle for a mobile device) through to $914 (all three of those, plus a printer for receipts and an iPad 2). Groupon is also selling these a la carte (by the slice?) on its web site in the Breadcrumb Store, with other products including the iPad Mini, and other products.

With Groupon currently beating analyst expectations but still searching for a new permanent CEO after the ouster of founder Andrew Mason, it’s moves like this one that are signals to the market that it is trying to get itself into fighting fit shape, cutting away some of the excess and focusing its products and execution. Whether merchants will buy into the deal being offered by the company — lower rates and all — and whether Groupon will be able to extend this to its still-fragmented but huge international business, are the two big questions. Especially as competitors like Square and Paypal continue to up their game with products not unlike those Groupon’s offering in the Bread Box.