We’ve all unfolded a few notes, counted our loose change, used debit or credit cards and even written a check or two at some point…of sale. However there’s a major transformation happening with our relationship toward money, a transformation enabled by the arrival of mobile payments. The magnitude of which will be felt worldwide and undoubtedly change the face of retail forever.
The mobile payment landscape is rapidly evolving, rapidly changing everything, relentlessly and without apology to those who can’t keep up. Why this burst of activity? Well it’s all to do with the explosion of smartphones. People are now carrying more powerful technology in their pockets than was even imaginable five years ago. iPhones, BlackBerrys, Androids and Windows phones have taken the power of home computing to a whole new level, giving almost everyone access to technology, all of the time. The proliferation of smartphones has been a key driver for innovation because it has enabled more players to do more things with people’s phones. It was only a matter of time before technology providers began to try and assert their control over this space. Especially given the fact that most people would rather go a whole day without their wallet as opposed to their smartphone.
Every month, in fact almost every day seems to bring news of a new mobile payment device, platform or scheme. Take for example August, which has become one of the pivotal months in the growth and visibility of mobile payments. The wide range of players weighing into this space in such a short period of time is just incredible - what with the likes of PayPal and Discover teaming up to bring PayPal to Millions of In-Store Locations, McDonald’s testing a new payments system in which customers use their mobile app to order and pay for meals and of course payments startup Square teaming up with Starbucks to complete all of the coffee chain’s credit and debit card transactions - A momentous month for mobile money.
And that’s only this month. Payment networks such as Visa and MasterCard are gearing up to move away from traditional plastic with their new range of contactless and virtualised cards. Operators, such as o2, Orange and Vodafone, are seeking to leverage their huge customer base in mobile messaging with ‘Project Oscar’. Then there’s Google Wallet & Apples ‘Passbook’, both of which are trying to make sense of the ever increasing set of payment options, loyalty schemes and special offers that characterise the modern shopping experience. It’s therefore clear that shoppers today are shifting from a single shopping approach to a multichannel experience, and retailers need to connect and interact with customers on all fronts or risk losing them to the competition.
It’s a case of working smarter, not harder - essentially retail-survival-of-the-fittest folks, where winning the race means understanding, embracing and committing to new and innovative technologies.
However, mobile payments haven’t become the prevalent method of financial transactions… yet. Although we are moving ever closer to a ‘cashless society’ as the mobile payment market is expected to be worth a projected 600 billion by 2013 and overtake those antiquated pieces of metal we call ‘cash’ (which, by the way, have been around since 600 BC). The question for the retail world is therefore a very simple one. Can you change your business model to keep up with the upward trends enforced by new technologies? Indeed, this might be the first time retailers enthusiastically embrace a brand new technology. There is that much at stake.