The $467.3B opportunity you shouldn’t ignore
More and more, people are relying on their phones as a proverbial digital third-arm capable of performing every transaction imaginable. What’s more, studies estimate the mobile commerce market will grow from $116 billion in 2014 to $467 billion in 2019.
Mobile wallets are transforming the payment landscape at a staggering pace. This is partly driven by how ubiquitous smartphones are in almost everything we do.
From hitting the snooze button every morning, to checking prices online while shopping, and accessing our favorite products at the tap of a finger anytime, anywhere – smartphones are now our trusted sidekick device for nearly every daily task. And that long to-do list naturally includes paying for goods and services, both in-store and online.
Smartphone prevalence in our lives has presented an opportunity for businesses. So it’s clear why tech giants like Google, Apple, and Samsung are producing their own mobile wallets. They’re all looking for a slice of that fruitful mobile commerce pie.
Mobile wallets are the new swiss-army knife
But why are mobile wallets so popular? Today, Millennials and Gen Z’ers combined form the biggest consumer group in history. Their joined spending power is set to grow to $1.4 trillion in 2020.
If there’s one thing younger generations love more than sipping a pumpkin spice latte, it’s paying for it with a tap of their Apple Pay or Google Pay wallet enabled devices. The sweet simplicity that mobile wallets offer allows users to send, receive, store money, and pay through their smartphone.
But that’s just the beginning.
Mobile wallets can now do much more than facilitate payments. Many have evolved into a sort of payments swiss-army knife, with special features including the ability to split bills with friends, browse featured merchants on the app, pay utility bills, and much more.
Some even allow users to send or request funds from anyone, via just a mobile phone number. Gone are the days of having to remember your recipient’s bank account number, or deal with clunky, outdated things like SWIFT or branch codes.
All this makes mobile wallets super convenient – and therefore hard to resist for consumers. Come to think of it, merchants find them beneficial too. Mobile wallets help them reduce paper waste and expedite transactions through a seamless, user-friendly experience.
With 56% of all e-commerce transactions to be paid through mobile wallets by 2023, delivering the user experience customers demand is more crucial than ever. When your mobile wallet strategy is done right, you can enjoy higher user engagement. And with the possibility to customize wallets combining your branding with loyalty schemes and promo offers, it’s the perfect investment.
Since mobile wallets are fully digitized, they can also empower businesses with rich data about customer preferences and spending habits. By implementing mobile wallets as a payment method, merchants can use the newly available data to make more informed decisions in their communications and tailor special offers that jive with customer favorites.
Mobile payment solutions: a safer and more secure way to pay
Mobile wallets aren’t just the sleek option. They also offer more security than either cash or credit cards, for both businesses and consumers.
Credit cards are notoriously unsafe. Because the magnetic stripes on the card are really easy to read by any magnetic scanner, this makes them open to anyone who wants to steal a card’s information. And we all know with cash, if you lose it, you probably won’t be getting it back.
Mobile wallets are more fraud-proof than regular credit cards, thanks to advanced encryption technology. This basically means instead of customers’ credit card data being transmitted in every single transaction, a random sequence of numbers is generated.
That’s where tools like tokenization can come in to safeguard the payment process. If the sequence ever gets stolen, it would be useless to the thief. So even if your store gets hacked, your customers’ credit or debit card number won’t be compromised.
The best part about mobile wallet security? They automatically meet the two-factor authentication requirement for Strong Customer Authentication (SCA) under the EU’s PSD2 legislation. This is because mobile wallets have integrated biometric authentication that analyzes fingerprint, face, iris or voice recognition, as well as behavioral patterns.
What does all this mean for merchants in Europe? By implementing mobile wallets as a payment method, you can easily comply with SCA under PSD2.
How do you get your mobile checkout set up?
Unsurprisingly, getting your business set up to start accepting mobile payments is relatively easy and painless. Just have these tips in mind.
Keep your mobile payments setup simple
Don’t get bogged down with choosing which mobile wallet is best for your business from the dozens of options out there. You’re far better off talking to your payments service provider. For instance, as a global payments platform, Payvision can advise you on which mobile wallets are most popular in the different countries where you operate. Or whether a particular payment method is even used at all in a specific market.
If you’re thinking of integrating mobile payments into your business, take a look at our free Mobile payments report to update yourself on the latest best practices and trends in the industry.
Integrate mobile wallets with traditional payment methods
Just because you want to jump on the mobile wallet bandwagon to future-proof your business doesn’t mean you should neglect traditional payment methods like credit cards. Many millennials have already started linking their credit cards to their favorite mobile wallets. But there’s of course still some who haven’t made that transition yet.
For example, let’s not forget that annoying moment when your phone battery dies. That’s exactly when customers will appreciate having flexible in-store payment methods like credit and debit cards. After all, no one likes holding up the line at the checkout while struggling to pay for their purchase.
Offering the option to pay by credit card or cash in addition to mobile wallets in those situations helps to ensure you’ll never lose out on a sale.
Use your mobile wallet trend analytics to the fullest
Once you get set up to start accepting mobile wallet payments, you’ll also be able to access a whole new world of detailed analytics. Taking stock of these trends and implementing them into your business strategy will help you better understand your mobile users’ preferences.
So how exactly can you make the most of these tools?
The point-of-sale data made available to you through mobile wallets can teach you a great deal about:
- Products that are the most popular
- Rewards that drive usage and keep engagement up
- Campaigns that give you the most bang for your buck