Mobile payment platforms are being widely talked about and will radically change the way of doing business in the world; however, they are being adopted more slowly than the world expected. With Multiple platforms fighting for dominance in the field, it is difficult for the consumer to choose a particular platform. Many people are not sure which platform to use and may be waiting for a particular platform to take the lead or they may be satisfied with their current payment methods.
The world is experiencing a rapid and increasing use of digital methods of recording, managing, and exchanging money in commerce. In the recent years, many popular companies like Apple, Google and Samsung have released their own version of these digital payment apps. With more than 7 Billion mobile phone users this platform is unlikely to fail.
Recently, statistics that was presented in March by Pymnts.com seem to support the latter. There are a small percentage of the consumers that are trying to use these mobile wallets and the conversion rate is low. Accordingly, Apple Pay already shows the highest trial rate – 21.9%% as opposed to 14.6%% for Samsung Pay, 14.5%% for WalMart Pay and 9.7 % for Android Pay – but the trial rate is not producing regular users.
Apple Pay, which was in the lead, appears to be losing ground while Samsung Pay is on the rise. A recent study by Boston Retail Partners found out that Apple Pay had the largest percentage of USS merchants supporting the service, however the Pymnts.com report shows that Samsung Pay is used more often. According to the Pymnts.com report Samsung Pay has a 4.5% usage rate which is the highest among all the platforms in the report.
There is a decrease in the number of people trying out Apple Pay. Reports show that all other platforms show relatively flat rates in the number of attempts of the people trying to use their services. Apple Pay shows a steady but small decrease over the last twelve months.
Brand loyalty plays a main role in derailing the integration efforts for both groups. A person having an Apple phone generally prefers Apple products. The same principle applies to Samsung users. However, the major issue is that consumers simply don't have a strong enough reason to switch to mobile payments.
The report from Pymnts.com states that about 41% to 49%% of Americans that are not using mobile payment platforms report of being satisfied with their current payment methods (in lieu of a particular mobile app), another 20%% to 27%% have security concerns regarding these platforms. A solid 24% of those when questioned about Apple Pay were not sure how it worked, compared to 17%% of those questioned about Samsung Pay, WalMart Pay and Android Pay.
These reports bluntly show us the challenges that are being faced by these mobile payment platforms. These platforms are dealing with a fairly satisfied customer base with the incumbent competitor (credit/debit cards and cash), a significant number of people are not sure how the application works, and another significant group concerned about the security of the platform. So, don’t expect to see mobile apps break through these barriers any time in the near future.
This was a guest post by Adithya Kumar.