With Apple Pay expanding its services into Asia, and Samsung Pay recently launching in several markets across the region, mobile wallets are about to reach a tipping point.
For retailers considering accepting mobile wallets in-store and online, here are five key factors to keep in mind:
1. Measure your potential reach
When Apple Pay arrived in Singapore for instance, its usage was restricted to only American Express cardholders. However, this is changing. Apple Pay is now available to customers in Singapore of at least five major banks, covering 83 percent of credit and debit cards in the country.
Before long, the bulk of mobile devices in Singapore will carry robust payment technology provided by Apple, Google or Samsung, and supported by the local banks. This puts easy mobile payments into the palms of literally millions of Singaporean shoppers.
2. Understand security and compliance
It is crucial for merchants to consider these factors, especially in relation to compliance and liability. In order for the single-tap payment to work, the customer payment data needs to be stored somewhere. However, who stores this data, and is it secure?
The answer lies in tokenization, which is used by Apple Pay, Android Pay, and Samsung Pay. This means that the customer payment data remains encrypted and never touches the merchants’ system. To further secure the process, a customer authentication is still required, either by pin code or fingerprint.
As a result, retailers supporting one-tap or one-touch payments can be sure their shoppers’ data is secure, while keeping the scope of their Payment Card Industry Data Security Standards (PCI DSS) compliance to a minimum.
3. China remains a booming market not to be overlooked
Chinese shoppers are avid users of mobile wallets and these shoppers are touring the world. A recent report from the Seoul Metropolitan Government shared that Chinese tourists are spending more as compared to other counterparts such as the Japanese.
Around 68.8 percent of these tourists use their mobile devices offline for payments, according to a survey by Tencent. So, when evaluating mobile wallets, retailers should definitely include the needs of the Chinese shoppers. Alipay has 100 million users making $148 billion worth of payments through mobile phones, and WeChat Pay, which has over 650 million users globally, is rapidly expanding its international reach to accommodate Chinese shoppers aboard.
4. Integrate mobile wallets into a wider omnichannel experience
Shoppers today expect a consistent experience across all sales channels, and the mobile phone often serves as the bridge between two worlds. For example a shopper may use his/her phone in-store to browse additional styles, compare items or read customer reviews; alternatively, the customer might order the item on her phone while on the move, and then collect it in-store.
The mobile wallet can play a key role, enabling a seamless checkout experience both in-app and in-store.
5. Get customer response by testing mobile wallets in key markets first
Clearly, there is no magic bullet approach to mobile wallets, and different business models require different solutions. A good way to evaluate different methods is to pilot them in a limited number of stores first, measuring KPIs such as robustness, user-friendliness, and rate of adoption.
The mobile wallet technology is there and the market is ready. It is now up to retailers to capitalize on the opportunity. Importantly, retailers must ensure that their payments partners are capable of supporting these latest payment innovations, and whatever comes next.
(Source: Enterprise Innovation )