Three Strategies to Develop a Customer-Centric Mobile Wallet

By Abby Cook, Senior Project Manager

Mobile wallets and payments have been popular topics in the payments industry for some time. However, it’s only fairly recent that merchants and providers have started to embrace the importance of offering the customer a seamless end-to-end experience, and have invested in technology to support this.

mobile walletWhile many merchants believe that a good mobile strategy starts and ends with a smooth checkout process, this couldn’t be further from the truth. The full customer-centric approach follows up with positive reinforcement by offering loyalty rewards and helpful notifications to drive repeat transactions.

To achieve this, mobile payments providers and merchants must work together to create an easy, convenient approach to payments. Here are three proven strategies to do this:

Win Trust
Merchants have capitalized on their ongoing relationship with customers to roll out mobile payments. For example, Starbucks leveraged its existing customer base and grew mobile adoption through its loyalty program, My Starbucks Rewards, incentivizing customers paying with their mobile app to join. Amazon’s account-based structure enables consumers to seamlessly adopt Amazon Payments without significant added effort, too. The e-commerce giant has built trust by providing a secure checkout experience on their own site, which has led to successful adoption in using Amazon Payments with other merchants.

Make it Easy
Mobile wallet providers need to create the opportunity for customers to leverage their mobile wallet by providing a network of easy-to-access payment opportunities for the user. Put yourself in the consumer’s mind frame: I put my top credit cards, gift cards and loyalty/rewards programs into to my wallet so they’re all in one convenient place when I want to use them. Why should this be any different with a mobile wallet?

PayPal is a clear leader here. According to the company, 250 of the top 500 online merchants ranked by Internet Retailer now offer PayPal’s One Touch payment service on their websites and/or apps. The opportunity to pay with one’s PayPal account is readily available when shopping online and via mobile. The aforementioned Starbucks excels here, too, and Square’s new NFC reader now helps smaller-scale independent shops compete by offering the same seamless mobile checkout experience. This enables businesses of any size to easily integrate mobile payment capabilities for its customers.

Build Loyalty
Mobile payments shouldn’t just end with a transaction. All merchants and providers should be looking for ways to encourage customer loyalty.

Again, Starbucks leads the industry here. With a product like coffee that is generally purchased daily, they have the perfect opportunity to build loyalty by offering points with purchases to earn free coffee or food items, send location-based promotions to its patrons, and help them avoid lines by ordering ahead on their mobile device.

At the same time, other mobile wallets provide more subtle value-added services. For example, Apple Pay keeps a record of all purchases and provides push notification receipts, even when it’s not used as the payment method. By consolidating these capabilities with the other passes in the Apple Wallet, the provider allows for daily touch points with the consumer, reinforcing the importance and usability of a mobile wallet where everything is stored.

Over the last few years, both merchants and payments industry professionals have been asking the question, “Who will win the race to mobile payments?” I don’t believe this is going to end with one winner. Just as we have many banking institutions, there will be various mobile payment solutions—there is no one size fits all solution. That said, mobile payment providers, and merchants that continually strive to improve the customer experience will likely prevail.

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