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Here's how the new MacBook Pro could boost Apple Pay
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One small feature of Apple's new MacBook laptops could be a huge deal for Apple Pay.
The computer includes a Touch Bar, a multitouch screen that replaces the existing function keys and power button at the top of the keyboard. In the far right corner, where the power “button” is located, that bar is Touch ID-enabled. That means it supports fingerprint authentication— a potential game changer for Apple Pay.
Adding Touch ID to the MacBook could help grow adoption of the wallet for several reasons.
The majority of e-commerce purchasing still occurs on PCs, not mobile. In Q1 2016, just 18.6% of total US e-commerce sales occurred on mobile devices. And though that's rising quickly, BI Intelligence expects that mobile will account for a minority of digital commerce though at least 2020. For Apple Pay to succeed, it will need to capture a share of users who buy exclusively on PC.
This makes it a lot easier to use Apple Pay on PCs. When Apple Pay first launched in-browser earlier this fall, customers looking to pay on their PC would have to click the pay with Apple Pay button, and then use their iPhone to authenticate the purchase with Touch ID. That could have deterred users, because it’s less convenient than entering credit card information or paying via phone to begin with. Allowing users to authenticate directly on their computer could push existing users to pay with Apple Pay for a larger share of their commerce, and might help new users test the service.
Apple Pay adoption has stagnated just below 25% of eligible users, according to ongoing data from PYMNTS and InfoScout, which means the service must find ways to better engage eligible users. In-browser offerings could be one such tool, especially since paying via web is more common than in-app payment. Reducing friction and better exposing users to Apple Pay in the environment where they are doing most of their digital shopping could help bring onboard more users and aid in ongoing usage, which could lead to habit formation and increased adoption across the board.
Mobile payments are becoming more popular thanks to services such as Apple Pay, but they still face some high barriers, such as consumers' continued loyalty to traditional payment methods and fragmented acceptance among merchants. But as loyalty programs are integrated and more consumers rely on their mobile wallets for other features like in-app payments, adoption and usage will surge over the next few years.
Evan Bakker, senior research analyst for BI Intelligence, Business Insider's premium research service, has compiled a detailed report on mobile payments that forecasts the growth of in-store mobile payments in the U.S., analyzes the performance of major mobile wallets like Apple Pay, Android Pay, and Samsung Pay, and addresses the barriers holding mobile payments back as well as the benefits that will propel adoption.
Here are some key takeaways from the report:
In our latest US in-store mobile payments forecast, we find that volume will reach $75 billion this year. We expect volume to pick up significantly by 2020, reaching $503 billion. This reflects a compound annual growth rate (CAGR) of 80% between 2015 and 2020.
Consumer interest is the primary barrier to mobile payments adoption. Surveys indicate that the issue is less the mobile wallet itself and more that people remain loyal to traditional payment methods and show little enthusiasm for picking up new habits.
Integrated loyalty programs and other add-on features will be key to mobile wallets taking off. Consumers are showing interest in wallets with integrated loyalty programs. Other potential add-ons, like in-app, in-browser, and P2P payments, will also start fueling adoption. This strategy has been proved successful in China with platforms like WeChat and Alipay.
In full, the report:
Forecasts the growth of US in-store mobile payments volume and users through 2020.
Measures mobile wallet user engagement by forecasting mobile payments' share of their annual retail spending.
Reviews the performance of major mobile wallets like Apple Pay and Samsung Pay.
Addresses the key barriers that are preventing mobile in-store payments from taking off.
Identifies the growth drivers that will ultimately carve a path for mainstream adoption.
To get your copy of this invaluable guide, choose one of these options:
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The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of how mobile payments are rapidly evolving.
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