“We believe Apple’s Apple Pay represents significant progress for mobile-wallet penetration, with strong support from the payment networks and issuing banks and promising results reported in a consumer survey we conducted three months after its introduction,” Gil Luria and Aaron Turner, Wedbush analysts, write for Barron’s. “However, we believe Apple Pay’s success will continue to be impaired in the U.S. as retailers see it as a threat and continue to build an alternative payment infrastructure that will serve their needs, not Visa/MasterCard and the banks. We believe that the dismissal of U.S. retailer efforts by investors may be more a result of payment industry groupthink than an observation of current trends.”
“Our consumer survey of 562 Apple iPhone 6 users indicates early reactions to Apple Pay are positive, with 20% already using Apple Pay either in-store or in-app. Half of the rest of iPhone 6 users indicate they have “not gotten around to it,” which shows the potential for further penetration. In spite of limited availability of locations and some inconsistent experiences with loading cards and paying in-store, 75% of iPhone 6 users intend to use Apple Pay more going forward,” Luria and Turner write. “However, we believe Apple Pay will not be successful in the U.S. until retailers broadly embrace it, which has certainly not been the case so far. Apple has only added a handful of retailers in the first three months (beyond those that were already near field communication-enabled) and some retailers (Wal-Mart Stores, CVS Health, and 7-Eleven) have even been vocal about blocking Apple Pay. Our survey shows that consumers conducted half their in-store transactions at only five retailers. More surprising was the slow in-app adoption, with 60% of transactions happening in only three apps, half of which were in Apple’s own app.”
Luria and Turner write, “We believe retailers are concerned about new charges for tokenization as well as the mix shift to credit, but also about topics such as control over their own data. In the name of security, Apple Pay eliminates the retailers’ ability to capture customer information that can be used to provide a richer ‘Amazon-like’ consumer interaction.”
Read more in the full article here.
MacDailyNews Take: If you want Apple Pay at recalcitrant retailers like Walmart, CVS, 7-Eleven, etc. you must refuse to shop in those stores and go elsewhere, preferably where Apple Pay is accepted (shop at Walgreens instead of CVS, for example).
Malignant shitholes like Walmart only understand one thing: Loss of revenue. Send them a message. Hit them where it hurts.
Oh, and Merry Christmas, peace and joy to all!*
*who support Apple Pay
Apple Pay has strong momentum; took 1% of digital payments in November – December 20, 2014
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