The mobile wallet – technology enabling consumers to pay with their mobile phones – will emerge as a new marketing platform in 2016. As the first generation of digital natives comes of age, and more payment technologies and apps come on to the market, the mobile wallet is evolving into an integrated marketing platform offering a range of services to consumers that extend beyond payments.
Generation Z – those born after 1995 – are digital natives, and spend almost 10% of their income online (source: BI Intelligence), nearly twice as much as older millennials. 58% of them prefer using the mobile internet to watching TV (source: Ericsson). As they mature into independent adults, making financial transactions with the device most central to their lives – the smartphone – will be a logical progression for them.
A host of mobile wallets launched in late 2014 and 2015 – such as Apple Pay, Samsung Pay and Android Pay – and the number of merchants accepting these services has grown rapidly. Over 700,000 now accept Apple Pay, and over 30 million accept Samsung Pay. As the previous generation of devices that are incompatible with mobile payments reach the end of their lifecycle, many consumers will replace them with new, compatible devices this year.
China’s advanced mobile payments sector foreshadows what is in store for other countries. The mobile wallet in China is evolving into an integrated offering of services related to payment, such as loyalty programmes, leaving tips, making donations, sharing bills, and redeeming coupons. Alipay – arguably the world’s most widely used mobile wallet – allows users to share bills easily, and incorporates a virtual metro pass useable in 35 different cities. Some services, such as the restaurant review and reservations site dianping.com, accept payments through instant messaging service WeChat, which can also be used to book and pay for taxis via the Didi Taxi app.
As payment and other utilities converge into single hubs, mobile wallets will also evolve into potent marketing platforms for brands. Alipay, for instance, already lets brands reach consumers through banner ads, but future mobile wallets will offer more sophisticated opportunities to engage consumers through relevant content, and enhance their entire shopping and consumer experience wherever they are.