Suddenly, Santa Is Square


Square is breaking rules again. Just in time for the Holidays, the company best known for turning iPads and iPods into cash registers is changing the way we buy gift cards.

Log in to Square Wallet -- the company's alternative to Google's Wallet and eBay's PayPal -- and you'll see a directory of nearby businesses which accept Square. Activate search to find a specific store or browse by category.

Click on a business and you'll be presented with details, directions, and the option to "add to wallet," which effectively bookmarks the business as one you'll frequent. You also have the option to buy a gift card without swiping a credit card at the point of sale. Here's how that part works:

Investors will rightly point out that rising interest in Square correlates with the company it keeps. Starbucks is both a partner and an investor. Yet I see a broader opportunity here.

Gift cards tend to favor big brands because of distribution. Your grocery store may sell a variety of options for and iTunes, but you'll have to visit the local craft store if you want to purchase a gift card for your sister who wants knitting supplies. Square makes it possible to execute this same transaction with a few clicks.

And that's important. At the very least, it means local businesses could come to see Square as an ally rather than an expensive merchant whose marginal services and unwanted fees get in the way of profits. In fact, some already are.

But we're also in the early stages of a mobile revolution that promises to unleash trillions in value as it upends existing ideas and business models. Square is but one benefactor. Our analysts have identified another that could win even bigger. Do you know this multibagger in the making? Click here now to get the name and the associated research report -- it's free.

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Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakersstock-picking team and the Motley Fool Supernova Odyssey I mission. He owned shares of Google at the time of publication. Check out Tim's web home and portfolio holdings or connect with him on Google+, Tumblr, or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool owns shares of and Google. The Fool owns shares of and has written puts on Starbucks. Motley Fool newsletter services have recommended buying shares of, eBay, Starbucks, and Google. Motley Fool newsletter services have recommended writing covered calls on Starbucks. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

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