Apple Pay and wannabes must offer perks to grow

“Apple Pay, Samsung Pay, Alphabet’s Android Pay and other mobile wallet offerings ‘will take off in 2016,’ said an eMarketer report on Monday,” Michele Chandler reports for Investor’s Business Daily.

“The research group said that more services are needed to convince more consumers to ‘change decades of ingrained payment behavior’ and stop paying with cash and credit or debit cards and instead pay using the tap of a smartphone screen,” Chandler reports. “‘Connecting more of the retail commerce experience to mobile wallets — especially when it comes to offers, coupons, rewards and loyalty — will be critical to getting more people to pay with their phones,’ said eMarketer.”

“Mobile payments are forecast to total $8.71 billion in the U.S. this year, with users expected to spend an average of nearly $376 using their mobile phones as the payment method,” Chandler reports. “In 2016, total mobile payment transactions are expected to reach $27.05 billion, with users spending an average of $721.47 annually. Mobile pay users will surge nearly 62% next year, eMarketer said.”

Read more in the full article here.

MacDailyNews Take: As we wrote in August:

Apple, give us a reason to use Apple Pay beyond looking like tech dorks in front of the line at the register. What’s the incentive to use Apple Pay? There is none besides looking like a flaming nerd. As if Apple doesn’t have any money. That, inexplicably, is how they approach Apple Pay. Hello, Tim? Eddy? Talk to some people who actually go to stores and shop for things, please.

Incentivize its use! Give Apple Pay users a percentage of every dollar spent via Apple Pay to spend at Apple Stores. Something. Anything! Get people used to using it first. Sheesh. It’s really not that difficult. It really isn’t.

Starbucks, KFC, and Chili’s to accept Apple Pay this year – October 8, 2015
Barclays to bring Apple Pay to the UK in early 2016 – October 7, 2015
Some Best Buy stores are now accepting Apple Pay – September 18, 2015
MCX CEO gone a day after Apple Pay lands Best Buy – April 28, 2015
Best Buy capitulates, to accept Apple Pay despite CurrentC allegiance – April 27, 2015
Major retailers see Apple Pay wave – November 17, 2014
In only 3 weeks, Apple Pay is changing how consumers pay – November 17, 2014
Boycott CVS and Rite Aid – October 27, 2014
Bad business: CVS and Rite Aid antagonize their most well-heeled customers by blocking Apple Pay – October 27, 2014
CVS stores reportedly disabling NFC to shut down Apple Pay – October 25, 2014
iPhone users earn significantly more than those who settle for Android phones – October 8, 2014
Yet more proof that Android is for poor people – June 27, 2014
More proof that Android is for poor people – May 13, 2014
Apple’s iOS dominates in richer countries, Android in poorer regions – March 25, 2014
Twitter heat map shows iPhone use by the affluent, Android by the poor – June 20, 2013


  1. I would suggest that you get 1% of everything you charge to ApplePay back in the form of Itunes dollars. It is a win-win for Apple, that way, and it gives users a small incentive to use the service.

    1. What percentage are apple getting?
      TSB are currently giving 5% back on Apple Pay transactions (and contactless card payments) with a monthly limit. I assume they fund this out of moneys earned by people going over drawn, interest charges on credit cards, etc.

      MasterCard have been doing free TFL travel on Mondays using Apple Pay, but I assume they get a larger transaction percentage than Apple.

      From Apple’s point of view any service ultimately serves as a way of selling hardware. Getting a small amount of cash back is not something I see as selling a lot of phones, isn’t it just more a case of being just one of many features, a feature that is better than the alternatives and something that people will increasingly use over time. Is it something that has to have rapid adoption?

      1. There’s actually a fundamentally different problem with Apple giving an incentive for use. Privacy. Apple have taken a stand that they don’t know how much, or where or what you’ve spent.

        For Apple to give back a percentage of proceeds, they would have to have some access to transactional details… unless it was completely administered by the CC company.

        I suppose Apple could get around this by making ‘signing up’ for “Apple Points” optional, but still they’d need a way to resolve customers who claim ‘missing points’

        As much as I’d love to see a monetary incentive, I just don’t see it happening without exclusivity agreements with certain cards. Since that would slow adoption that’s a non-starter.

    2. Apple is reported to take a fee of 15 cents per $100 of transactions. Even if Apple were to pass all of that onto customers, it wouldn’t be regarded as much on an incentive.

      What Apple offers is convenience combined with enhanced security. If banks and consumers feel that other incentives would be more important, then that’s their decision, but genuinely effective fraud prevention is a highly desirable feature for both customers and banks. If people are choosing a payment system based on which one offers the most attractive perks, then they are inviting problems further along the line.

      1. Isn’t that what many are already doing? I use my Tesco card because it gives me a little but worthwhile balance over the opposition. Fact is you need to change peoples thinking, once they get used to it yo0u don’t need to give them such incentives but fact is the more people that use it the better for Apple one way or another so while they may not be chasing market share its always worth taking a small hit initially to gain more later.

      2. Transaction security is a problem for merchants, not for customers. Credit companies already protect cardholders from fraud — the vendor is the one who gets screwed.

        There’s no compelling reason for customers to use ApplePay. It’s not any easier than a credit card, despite the ridiculous infomercial-style video Tim Cook used to introduce it.

        Merchants are already incentivized to implement it by way of the security — they should be the ones encouraging consumers to use this tech.

        1. You clearly haven’t used Apple Pay. It is easier. The difference obviously isn’t huge, but it is easier. Most men have their phone in an outside pocket, and their wallet in an inside pocket. For majority of people, pulling out a phone out of the pocket is an easier maneuver than pulling out the wallet. Once the phone is out, the only remaining step is the fingerprint authentication using TouchID sensor. Meanwhile, you need two hands to open your wallet, pull our the credit card, swipe it at the terminal, show it to the cashier, put it back in the wallet. The total time difference is perhaps no more than 15 seconds, and the total effort difference is two hands vs. one hand, but there IS a difference, and the ApplePay experience is simpler, quicker and smoother. Perhaps as much (or more) difference as there is between paying in cash (and either counting the exact change, or waiting for change) and paying with a credit card.

          1. It’s not easier by a wide enough margin to make it compelling. And it brings with it its own worries for the user: Time & effort to enrolling your credit cards, opening an additional attack vector on your identity, more drain on your already-tenuous iPhone battery, etc.

            And the 6s requires 2 hands to operate for many if not most people, so no savings there.

            I’ve got nothing against Apple Pay, I’m just saying it’s not a must-have feature for the end user. It’s a small convenience, and as the article says, if you want widespread adoption of it, you’re going to have to incentivize.

            Apple’s take from it is small potatoes, so I can’t see them caring one way or another whether people use it. The merchants are the ones who really stand to gain from adoption, and logically should be the ones pushing it through consumer incentives like loyalty / points systems tied to secure payment methods.

            1. Your last paragraph is totally correct. It is the merchants that should be pushing it aggressively, as it will eventually save their bacon.

              As for the wide-enough margin, the process of paying with a regular credit card is not complicated enough in order to make it possible for Apple Pay to be easier by that wide-enough margin. As I mentioned, you’re saving around 15 seconds, and no, you don’t need the other hand; even 6 Plus can be pulled out and unlocked with the thumbprint with a single hand (there is nothing to do on its screen — just unlock it with your finger).

  2. Just using Applepay with the Apple watch is fantastic enough… Not only it does not make u look like a nurd .. People around and cashiers get a major major kick out of it… They find it to be “super cool” … And they are not shy to vovlize it.
    My experience.

  3. Coworker has a Galaxy that he used Samsung Pay at a regular credit card terminal the other day. Worked the first time, easily. A little envious of a Samsung feature for the first time. However, I would never put up with the multiple screen presses it takes him to push a button on the phone.

    Also at the mall over the weekend, Samsung had a table and were offering to set-up your credit card on your Samsung Pay device and get a “free gift” a good idea to increase adoption.

    1. Don’t you think that if they need to have people offering to set-up your credit card, it must have been poorly implemented in the first place?

      Users should never need specialist help with something so fundamental as setting up a credit card so that it can be used with a smartphone.

    2. To use Samsung Pay one swipes up from the bottom of the screen – even if the phone is locked and the screen is off – and place your thumb (or whatever digit) on the home button and it “just works.” Samsung includes tech in their newer phones that can transmit a magnetic signal, so literally ANY credit card terminal can be used with it.
      I laughed the first time I heard “Samsung Pay” not long after Apple Pay, but I have to give them credit that they’ve come up with a nice payment system.
      And if you register a credit card they give a $100 credit to spend at Imagine the adoption rate if Apple did the same thing?

  4. I’m normally underwhelmed by MDN’s recommendations to Apple, but in general, this time I agree. It would cost very little to offer 1¢ of credit at iTunes per dollar spent using Apple Pay, and yet might be enough incentive to encourage many people to use the service. I also think offering assistance at Apple Stores for setting up credit cards on Wallet would be helpful (not that it is hard).

    1. Hang on a smartphone or Apple Watch are conveniences too. Indeed virtually everything Apple sells is a convenience thing over the opposition less easy to use offerings. As the opposition start to make things easier to use Apple might just have to try a little harder to appeal and not consider it is above such things, smugness doesn’t work for ever.

  5. Here’s how you get the public to embrace “tap to pay” forms of payment … final push out the horrible “chip & PIN” system and force them to use that!

    I traveled through Ontario Canada a few weeks ago for business, “chip & PIN” is widely used in Canada. It takes WAY too long for that process. ApplePay is so much quicker and easier to use!

  6. I love Apple Pay. The only problem, and this has been discussed here before, is its limited availability at POS. Hopefully penetration improves.

    One awesome feature that I just learned about: Apple Pay was automatically updated when I changed my card number due to fraudulent charges. I can use Apple Pay (where available) until my new card arrives.

  7. Yes, incentives! I know of many users of iPhone 6 and newer who never bothered. For them, it is a hassle to set it up (even though it is really effortless and simple). Whenever I use it in the store, they all react: “Cool!!”; then I tell them “You can do it on your phone, too!”, and they simply say it’s just a hassle…

    I upgraded my 5s o 6s because Discover Card finally started working with Apple Pay and has offered 5% cashback bonus until the end of 2015 (three months ago). By now, I had earned enough cashback bonus tanks to that promotion to cover the difference between the price of new 6s and what I got for my old 5s ($320).

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