MakovskyTuesday, February 18, 2014
Getting your daily caffeine fix just became much easier.
Recently, Starbucks reported that 10% of consumer payments came through mobile sources –remarkable, given its roots as a brick and mortar café, but not surprising, because the coffee giant is one of several companies heeding customer demand for frictionless commerce and mobile-focused initiatives.
Analysts have begun noticing a host of trends which make mobile point-of-sale – the paying of goods through a mobile interface — an increasingly prevalent force in retail:
- There are a total of 6.8 billion mobile subscriptions worldwide. In the US alone, a Pew Internet study found that 55% of US adults are smartphone users
- Among tablet users and mobile users, 38% and 24%, respectively, claim to have already made a purchase through their devices
- Mobile ad spending is expected to reach 13.5 billion in 2014.
The mobile payments market features many competing technologies. Wallet apps like Square, Apple Passbook, and Isis allow customers to connect their bank account(s) to their mobile devices, allowing phones or tablets to stand in as proxy credit cards. Others such as the Starbucks app act as digital gift cards that can only be used at participating stores and must be refilled on the mobile device. The App Store included on all Apple devices is an excellent example of hosting microtransactions on a mobile platform.
With an eye towards these trends, communications professionals envision mobile payment tools as another emerging digital channel for communications. An app that generates heavy traffic can create an excellent opportunity for cross marketing other products or offering loyalty programs. Mobile commerce can also serve as an ideal space for advertisements and general message delivery. Surveys distributed through apps, and data mining from an app’s user base, can reveal important insights to sharpen a company’s product or service offering.
Of course, mobile transactions may not be the most effective sales option for all companies. Large electronics retailers or car dealerships, whose sales rely heavily on customers’ testing or observing a product in person, should not expect too many purchases to occur virtually.
But for those aspiring entrepreneurs who wish to tap into the increasing amount of money spent over mobile, adopting a mobile payment app can prove invaluable to future business success.
– Vincent Yu