Mobile Wallet Fast Becoming Popular Consumer Accessory
The mobile wallet hasn’t replaced that old cracked leather standby, stuffed with credit and debit cards and cash—yet. But brick and mortar retailers believe quicker and easier is what today’s consumers want, and making purchases with a smartphone is the way of the future.
A group of leading merchants—including major brands such as 7-Eleven, Best Buy, CVS/pharmacy, Lowe’s, Publix Super Markets, Michaels, Sears, Shell Oil, Sunoco, Target, and Wal-Mart—announced they have formed Merchant Customer Exchange (MCX), to develop a mobile-commerce network to enable consumers to pay at the register with a smartphone. Additional retailer members are expected to be announced in upcoming months.
The MCX announcement was vague about details, merely stating that development of MCX’s mobile application “is underway” and that “a launch date has not been announced.” The app is expected to allow merchants to integrate and customize special offers and programs via consumers’ smartphones.
The mobile payment market is potentially a lucrative one. Data from IDC Financial Insights’ eighth annual Consumer Payments Survey focused on the usage of emerging payment technologies and found that more than a third of all US residents use mobile payments.
Juniper Research released a new report, stating, “The scale of global mobile payment transactions is expected to rise nearly fourfold over the next five years to more than $1.3tn.” In addition, the firm noted, “Physical goods sales from mobile/nomadic devices will account for 30% of eRetail by 2017.”
However, the MCX effort is already playing catch-up. According to The Wall Street Journal, “The new mobile-payments efforts already is running behind rivals such as the Google effort, called Google Wallet, which began operating last year on the technology company's Android devices. Isis, a collaboration of mobile carriers AT&T Inc., Deutsche Telekom T-Mobile USA Inc., and the Verizon Wireless joint venture between Verizon Communications and the U.K.'s Vodafone Group, will start trials later this summer in Salt Lake City and Austin, Texas.”
However, as merchants themselves, the MCX group feels that they have an advantage. “As merchants, no one understands our customers’ shopping and payment experience better than we do, and we’re confident that together we can develop a technology solution that makes that experience more engaging, convenient and efficient,” said Mark Williams, president of financial services, Best Buy.
More about mobile wallets and e-commerce
Bloomberg: Wal-Mart Joins Target In Forming Mobile-Payments Network
Juniper Research: Mobile Payments to Reach $1.3tn Annually by 2017, as NFC and Physical Goods Sales Accelerate
IDC Financial Insights: New IDC Financial Insights Consumer Payments Survey Reveals Over a Third of All U.S. Residents Use Mobile Payments
