Last week, Apple announced that the new version of Apple Pay will include retailer-branded cards and support retailers’ loyalty programs. Following the news, RetailWire, an online retail discussion forum, asked its BrainTrust panel of retail experts these two questions:
Will the changes being made to Apple Pay lead to greater adoption by chain stores? What are the greatest challenges to Apple Pay achieving greater market share in the mobile payment space?
From security concerns to what this means for rival MCX, the experts weighed in with their insightful predictions on Apple Pay, found below. The payment system has opponents and proponents, making it worthy of retailers continued attention.
Some entries have been edited by Retail Dive for content and length.
Paula Rosenblum, Managing Partner, RSR Research
Yes, the integration to loyalty programs is very important for adoption I think.
I don't see a lot of challenges to Apple Pay achieving greater market share beyond time—the refresh cycle for existing iPhone users holds it back, and the fact that Android users are not likely to switch.
It turns out that retailers' contracts with their providers requires them to still take a signature on the PIN pad. While this is not a deal breaker with shoppers, it is an odd annoyance. You've just used your fingerprint to validate that you're you. I've never understood what the squiggles line on the PIN pad quite proves.
I also think this puts the final fork in MCX. Integrated loyalty was its only obvious consumer advantage.
Camille P. Schuster, Ph.D., President, Global Collaborations, Inc.
Making consumers and retailers comfortable with the security of Apple Pay is essential for success. Linking payment with rewards programs is a change that will be attractive for retailers. Reminding consumers that Apple Pay can be used with specific retailers during checkout will also be helpful.
Ryan Mathews, Founder, CEO, Black Monk Consulting
There's no question Apple is serious about growing this end of its business and, when Apple gets serious, it generally pursues its targets pretty aggressively.
The real issues here are: how much linkage between products and services do consumers really want/; and, how many payment options are one too many?
Cathy Hotka, Principal, Cathy Hotka & Associates
The challenge now for Apple will be to find a compelling way to lure Android users away from their phones and onto the Apple platform. A tighter relationship with retailers to enhance the mobile shopping experience might be one avenue.
Ed Rosenbaum, CEO, The Customer Service Rainmaker, Rainmaker Solutions
Not only is Apple putting the final touches to other consumer loyalty programs, it is also pushing the Android users to make a hard decision when it comes time to decide what smartphone to get at renewal time.
Arie Shpanya, CEO and co-founder, Wiser
Apple is slowly but surely sweetening the deal for shoppers/retailers. The more seamless the experience becomes, the more value they'll find in adopting it.
Safety and security will be the biggest hurdles Apple will have to overcome to increase market share in the mobile payment space. Not to mention all of those Android users.
Shep Hyken, Chief Amazement Officer, Shepard Presentations, LLC
The short answer is...yes. For Apple Pay—or any alternative system—to work, it has to be simple and almost seamless. If I'm used to paying with my Discover card and can't do it on Apple Pay, then the Apple Pay system doesn't work for me. So, for Apple Pay to achieve greater market share and wide spread adoption, it must have the same basic benefits as any other typical payment system, plus the added benefits that Apple Pay's solution offers.
Mark Price, Managing Partner, LiftPoint Consulting, Inc.
The adoption issue in chain stores is not driven by technology, but by data. Chain stores have to be willing to give up some of the control of the credit card data that they have used in the past to match newly identified customers to past transactions.
The acceptance of loyalty card data is one step in that direction and may drive chain acceptance, since stores can track transactions back to customers through the loyalty card and thereby obtain the data that they need. That approach may overcome some of the hurdles that chain stores have faced in accepting Apple Pay.