November 4, 2012
Online Holiday Shopping for Kids and Parents with Virtual Piggy
Wouldn’t it be cool to have a PayPal for children? That’s the question Virtual Piggy set out to answer with its Children’s Online Privacy Protect Action (COPPA) compliant program. Making shopping easier for parents and children, Virtual Piggy has produced a safe and secure environment for purchasing goods while instructing children how to spend responsibly.
Virtual Piggy was first founded in 2009, with a merchant and consumer launch in 2011. The Hermosa Beach-based company created the product so that they could address many questions that surrounded privacy issues of children.
“Our service is designed to under 18, young adults who don’t’ have credit card,” said Joe Peden, a Virtual Piggy representative.
The Virtual Piggy system includes a log in for the parents, and another log in for children. Only parents can create the Virtual Piggy account and they are not requested to provide personal information, as defined by COPPA Regulation. As well, merchants are only able to market the products to parents and not to children. In terms of participation by children, in Virtual Piggy, they cannot access, review, or edit their profile information.
With the Parental Account, the parent enters the Virtual Piggy Website and provides a credit card or a PayPal account. The parents can the use a variety of selection tools to filter and select multiple merchants that can market their products to their children in the children’s account. They place an allowance amount in Virtual Piggy, which can be used by children to purchase products or subscriptions to other products.
For the children, they can add items to the cart. Before they are allowed to make a purchase or verify their identity, they are given the Virtual Piggy Payment Option. In validating the transaction, the kid enters their Virtual Piggy Profile and Password. Virtual Piggy then takes the information and checks to make sure that they are allowed to shop on the site and that the spending is not above the spending limit set by their parents. If these two criteria are approved, then Virtual Piggy approves the transaction. The transaction is in limbo mode until the parents approve or reject the transaction via SMS or email. Parents can approve purchases via their mobile device or in their Parent’s Dashboard portion of Virtual Piggy. If approved, the transaction is subsequently processed.
Apart from smoothing out the online shopping process, Virtual Piggy also includes an educational component. There is an education dashboard that includes a diagram of how much money has been spent, how much money is available, and the allowance amount. There is also a section for saving money, with a savings goal, as well as a section for charity, where an individual can contribute a certain amount to their charity goal.
Both families and companies alike have gravitated to the new technology.
“Like all kinds of disruptive technologies, this is one that finds that nice niche blend of financial companies marketing to kids and you know the kind of merchants involved are the kind of merchants that we want to be associated with a kids brand,” said Michael Araten, CEO of K’Nex.
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