Apple Pay adoption has generated significant attention since the mobile payment service launched, but measuring its success based solely on point-of-sale transactions may overlook its broader potential. Consumer surveys suggest substantial interest in Apple Pay, particularly among consumers who are also interested in emerging technologies such as the Apple Watch. That connection could become increasingly important as mobile devices and wearables become more deeply integrated into everyday commerce.
The bigger opportunity for Apple Pay may be its ability to simplify payments across digital channels. By reducing friction during in-app purchases, Apple Pay could help accelerate the transition from traditional e-commerce toward mobile commerce. As retailers rethink both their digital and physical shopping experiences, mobile payments and wearable technology could become important tools for connecting consumers with more seamless, personalized purchasing experiences.
The latest in a series of surveys trying to gauge consumer perceptions of Apple Pay, this one by 451 research, reports that 45 percent of respondents plan to use Apple Pay while only 28 percent preferred PayPal. The other interesting tidbit from the survey noted by Mobile Commerce Daily:
“In other key findings, respondents interested in buying an Apple Watch were twice as likely (54 percent) as all other smartphone owners to say they would use mobile payment apps (29 percent very likely and 25 percent somewhat likely).”
This is in line with the argument I make in my latest research note ‘Apple Pay at Six Months: A Medium Term Outlook’ where I argue that Apple Pay’s success cannot be judged based on how many iPhone users have used it to complete a payment at the point of sale since its release. What’s more interesting is how Apple Pay will streamline the in-app payment experience, accelerating the transition of e-commerce to being primarily mobile initiated. In a mobile-first world, merchants will no doubt be thinking about how to create immersive experience in their brick-and-mortar stores that leverage mobile and, soon, wearables in a big way. Apple Pay is a key piece of this puzzle, though it’s not immediately obvious from the results of the surveys we have seen on adoption rates thus far.
Apple Pay adoption should ultimately be evaluated as part of a broader shift toward mobile-first commerce rather than simply by the number of consumers tapping their iPhones at checkout. Its integration with apps, smartphones, and wearables gives Apple opportunities to influence how consumers shop across multiple channels.
As mobile commerce continues to evolve, merchants will need to consider how payments fit into increasingly connected shopping experiences. Apple Pay could play an important role by reducing payment friction and connecting digital purchasing capabilities with physical retail environments, making its long-term impact potentially much greater than early adoption figures suggest.
Overview by Nikhil Joesph, Analyst, Emerging Technologies Advisory Service at Mercator Advisory Group
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