A friend of mine from across the pond recently mentioned Google Wallet in his Facebook status and I realised then that mobile-payments are on the tipping point of becoming mainstream. I therefore wanted to spend some time exploring this exciting new technology and consider what needs to happen to tip it over the edge!
For the uninitiated, Google Wallet lets you store your credit card details on your mobile phone and uses Near Field Communication (NFC) technology to allow users to ‘wave’ their mobile at a Point of Sale device and have the relevant amount deducted. Online purchases can also be made through the app. Google Wallet has been live in the US since September 2011 with retailers like GAP, Macy’s and ToysRUs all offering relevant m-payment options. Whilst this all sounds great, the launch was limited given that Google Wallet is only available on a small number of devices, through one mobile operator (Sprint, one of the US’ biggest) and currently supports only two types of card (MatsterCard and a Google prepaid card – not quite a full wallet just yet – although plans to bring Visa and AMEX are underfoot by all accounts).Google and Sprint however aren’t the only players in the m-payment space nowadays, with other mobile networks, banks and payment services all vying to get a piece of the pie:
- T-Mobile, Verizon and AT&T, the other top three mobile operators in the US, are collaborating on a similar project (ISIS) expecting to launch later this year. In the meantime they are blocking the Google Wallet app on their handsets (that’s competition for you!)
- Ebay’s PayPal have taken things even further and are taking legal action against Google for stealing secrets by poaching staff. They’re currently testing their own solution with two Swedish retailers with rumours of a US pilot in coming months.
- And, just last Wednesday, Samsung, RIM and LG smartphones were all certified for Visa Paywave suggesting that the UK market is hotting up ahead of the London Olympics.
So drama aside, what needs to happen for m-payments to become a regular feature of our everyday lives and be adopted by the consumer? I thought I’d look at this question from a ‘Ready, Willing and Able’ perspective:
1) Ready: m-Payment technology needs to be readily available on a number of handsets across a variety of mobile providers and contracts. In addition, shops need to have the Point of Sale equipment and back office processes in place to accept m-payment transactions.
2) Willing: Consumers have to choose the m-payment option over cash, card and cheque. Barriers to this are concerns around security and what the purchase data will be used for (just imagine how much more Google could do if they knew not only what we search for but what we purchase too!). Firms will need to go on a charm offensive, clearly articulating the benefits of m-payments, being up-front about their security and data policies, avoiding any serious issues in the first few weeks/months and thinking of exciting new ways to incentivise take-up.
3) Able: Once the technology is in place and consumers are willing to use it, they have to be able to complete their purchases successfully. This means an easy to use interface with instructions and guidance, clear and efficient processes for when problems do occur and educated store staff, able to resolve issues at the point of failure.
At some point in the future, I believe we will all be waving our mobiles around with youthful abandon, paying for things effortlessly and probably spending more as a result. The journey has begun … now we just need to see what route providers and retailers will take us down!