Tag: mobile payments

Apple Pay is experiencing resistance from retailers

The holidays are coming, and that may be a time when mobile commerce shines. Those looking to use Apple’s new payment service, Apple Pay, may find it impossible to do so, however, due to resistance from retailers. While several major retail organizations have partnered with Apple to support the launch of its new service, relatively few of these companies have taken steps to adopt mobile point-of-sale systems. These systems are meant to accept payments made from a mobile device, but they are somewhat unpopular because of their high cost.

Lack of incentives from Apple leads retailers to look for other solutions

Apple has not offered retailers an incentive to acquire mobile point-of-sale systems. Apple has also only offered modest support when it comes to providing training material for companies looking to support its new payment system. Moreover, there is an ongoing skirmish within the retail space concerning mobile payments, with many companies favoring different payment solutions. Apple Pay may experience more competition in the retail space in the near future as well.

Merchant Customer Exchange is developing its own payment system that could rival Apple Pay

The Merchant Customer Exchange, a prominent retailer consortium, has plans to offer its own mobile payment service next year. This service is to be linked to a consumer’s bank account, serving as an alternative to credit cards. The service is also being designed to track consumer purchasing habits, allowing it to provide them with discounts on products that they frequently buy. While this service will not be available until 2015, it could disrupt Apple’s plans to be the proverbial king of the hill in the mobile payments space.

Mobile is gathering more momentum throughout the retail industry, driven by consumer demand

Mobile payments have become quite important in the retail space. More people are shopping from their mobile devices than ever before, and the demand for in-store mobile payment support is growing. Retailers are scrambling to accommodate this demand, but many are having trouble doing so because of the wide variety of services and technologies currently available to them.

1 in 6 of purchases made at the coffee company is via mobile phones.

According to Howard Schultz, Starbucks CEO, during the company’s third quarter earnings, 16% of the nearly 7 million transactions occurring each week at its shops are via mobile payments and this success is due to the early launch of its mobile version of its payment card, which has lead to Starbucks transacting over 90% of purchases made via mobile devices in the US, last year.

Shultz says that “the real growth is yet to come”.

The company’s upcoming mobile order and pay app will be its most significant technological innovation released in 2014. The CEO said that “Starbucks Coffee has cracked the code to tying mobile payment to loyalty.”

He explained that the success Starbucks has achieved has to do with leveraging “the intersection of three powerful mobile trends.” According to Shultz, these trends include a change in consumer behavior as people are spending more time online and less time in physical stores. There is also the trend of people eating out and less at home and the growing trend of people engaging in online activity via their mobile devices.

Shultz explained that Starbucks mobile order and pay” seamlessly integrates mobile ordering and our proprietary mobile program with point of sale and store operations.” He said that this enables Starbucks to enhances the experience of its customers, exceed their expectations and extend their loyalty.

Starbucks is seeing a growth of 50% in mobile payments every year.

The new mobile order and pay app is set to be launched in the Portland market in December and throughout the nation in 2015. The new app will enable consumers to place their order before heading to select stores, so they can pick up their order without having to wait in line.

The number of Starbucks cafés continues to expand in 2014, with more drive-up options being added to stores. Shultz said that even though the company does not have the software or the hardware expertise of its competitors it has managed to alter consumer behavior, which is something its competition has not done. The CEO stated that Starbucks has achieved this by integrating mobile payments convenience into an enjoyable and compelling program that gives customers rewards.