Why Retailers Should Get on Board with Mobile Payments
2015 is being touted as the “year of mobile payments,” although the technology hasn’t caught on as quickly as expected. The introduction of Apple Pay last year was supposed to drive a revolution in mobile payments — 1 million credit cards were used for Apple Pay less than 72 hours after its launch. However, recent studies show that just 15 percent of iPhone 6 users have even tried Apple Pay, and the number of stores and apps that accept it is fairly limited.
Still, major players are betting heavily on the mobile payments trend. In March, PayPal announced that it would acquire mobile payments startup Paydiant, and Google introduced a service called Android Pay to compete with Apple Pay. Even Facebook is getting on board with the addition of peer-to-peer payments using its Messenger app.
It’s clear that mobile payments are the wave of the future. Mobile payment apps store payment card information in smartphones, which interact with point-of-sale (POS) devices using near-field communications (NFC). This eliminates the need to pull out your wallet and find your credit card, and provides a single point of reference for all your purchases.
Consumers increasingly view mobile payment as a standard offering that makes transactions fast, simple and seamless. Experts predict highest usage of mobile payment solutions in high-volume, fast-paced establishments where speed is critical to delivering a positive customer experience. Merchants like mobile payment solutions because they make the sales process as frictionless as possible. This not only reduces the risk of losing the sale but enables retailers to collect data about customer preferences, promote loyalty programs, and share coupons and special offers.
Research firm eMarketer expects the number of mobile payment users in the U.S. to more than double next year to 36.2 million, accounting for $27.5 billion in transactions. More and more people, especially Millennials, would rather use their smartphone to make a payment than fumble with a wallet, and they don’t want to share or re-enter credit card information over and over. Retailers are expected to remember how customers prefer to pay and provide a more secure alternative to traditional credit card payments.
Mobile payment adoption has been slowed by the fact that few merchants have POS systems with NFC technology. However, retailers are under pressure to replace older magnetic strip card readers with terminals that accept “chip” cards by October 2015. This has accelerated the adoption of NFC readers that extract payment information stored in smartphones without forcing the customer to hand over a card or device.
But NFC readers are only part of the infrastructure required to accept mobile payments. A fast, reliable and highly secure network is a must. The ICG Network Infrastructure team can optimize your environment through the design, implementation and support of cost-effective network and security solutions. ICG’s managed services are designed to ensure network availability, performance and security over the long haul. Let us help you take advantage of a mobile payment solution that satisfies customer demand and creates additional opportunities for revenue growth.