The recent announcement by Tim Cook at the Apple Worldwide Developers Conference that Apple Pay will be available in the web will be by far the most significant accelerator in the take up of mobile wallet.
Or most directly, the take up of Apple Pay, but that should indirectly encourage take up of rival systems Android Pay and Samsung Pay through raised awareness of this way to pay.
So far, Apple Pay could only be used for payment in physical stores on the iPhone 6 onwards, which has understandably hampered adoption, but from this autumn a host of retailer websites will be incorporating the Apple Pay button into their webpages. Paying by selecting the Apple Pay button online then triggers a confirmation on your iPhone and the payment is concluded with a fingerprint ID touch, so 2 quick steps, as shown in this 16 sec clip.
This is a massive time saver because it means once you have done the initial registration of your bank cards & loyalty cards on Apple Pay you don’t have to keep re-registering all your personal details every time you want to make an online purchase from a new (to you) retailer, if they have the Apple Pay button.
Retailers love any system that reduces transaction ‘friction’. So retailers will love Apple Pay on web, because it will have a massive impact in reducing the number of abandoned baskets, a huge online retail issue that we have spoken about previously. Retailers also love customers with money to spend, and today’s iPhone 6/7 users still fall into that category…
Last but definitely not least, the adoption of Apple Pay in web transactions will also massively reduce the level of card fraud because it employs a far better security system than traditional payment cards. This is because it does not communicate your card details to the retailer but instead a unique digital ‘token’ each time.
So getting back to the article headline, what does this mean for PayPal? They should be worried at the prospect of iPhone owning PayPal users switching to Apple Pay. But at the moment as our latest figures show, PayPal is still regarded by the UK public as the no.1 brand to trust when it comes to a mobile wallet app. So they are in a good position, but mustn’t rest on their laurels.
Android Pay has recently debuted in the UK and Samsung Pay is rumoured to be coming later this year, and the latter will not be restricted by NFC technology at point of sale but will also work with old fashioned magnetic strip terminals. So the competition is hotting up.
The final point worth making is that trust levels seem to be on a gentle upward curve for the big providers. We at Marketing Sciences Unlimited have been tracking mobile wallet brand trust among UK smartphone owners since the summer of 2014 and can see this gradual improvement across the board.
So the question is will Apple now start to make much bigger inroads on PayPal, and perhaps drag Android Pay and Samsung Pay along with them? Who will be sitting pretty at the top of the ratings in 2018 I wonder?
Richard Snoxell is a Research Director in the Technology & Financial team at Marketing Sciences Unlimited, and the company’s resident mobile payments expert, or so he tells himself in quieter moments.