Apple Pay at two years: Not much to celebrate – yet

“Apple Pay marks its two-year anniversary this week, and while it supposedly helped spark a revolution for in-store mobile payments, there’s not much celebrating by Apple or its payments rivals,” Matt Hamblen writes for Computerworld.

“While Apple, Samsung Pay, Android Pay and many others keep adding users, the rate of adoption is far below what was expected when Apple Pay arrived on Oct. 20, 2014,” Hamblen writes. “More worrisome is the low repeat-user rate. Many consumers will sign up for a payment app and try it out with contactless technology like Near Field Communications (NFC) on a smartphone once to buy something in a store. After that, many don’t bother to do it a second time, because it is just too easy to use a credit or debit card — or even cash, according to a recent survey. Strategy Analytics estimates there are now 11 million contactless mobile payment users in the U.S., but just 2.3 million who are active users. The firm said there are just a third as many NFC-based mobile payment users as it projected in 2010.”

“In-store mobile payments, “in a way, are a cool ploy with no purpose,” said Mark Ranta, director of product management for digital banking at ACI Worldwide. ACI provides mobile and other payments software to banks, merchants and others,” Hamblen writes. “‘People ask, ‘What’s the benefit?” Ranta added. ‘For someone who’s not tech savvy, they have probably tried it once and said, ‘What’s the big deal with this? Opening up my wallet and swiping my card wasn’t a big deal to me, so why do I need to get rid of that habit? Instead of relying on some weird, wireless thing — screw that. I have a physical card that I can put in a terminal.’ … ‘So far, mobile wallets, particularly NFC, have yet to integrate payments with loyalty in a compelling way,’ Patel said. ‘You need a single tap to redeem or accumulate points and coupons.'”

Read more in the full article here.

MacDailyNews Take: As we wrote back in August, imagine at the special media event to introduce the next-gen iPhone, Apple CEO Tim Cook said something like this:

And, of course, the new iPhone works with Apple Pay and, starting today, for every $100 you spend using Apple Pay, you get $1 off at Apple retail and online stores. So, spend $100 on groceries using Apple Pay, you get $1. Spend $300 on a plane ticket using the Delta app, you get $3. Use Apple Pay in your ExxonMobil Speedpass+ app to buy your gas. It all adds up! By the end of the year, you’ll likely have quite a discount on your next iPad, Mac, or iPhone!

Would you use Apple Pay more if Tim Cook said something like that? We know we certainly would. So would millions of people.

As we wrote in August 2015:

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.

And, BTW: That was written before Apple Watch made the process so seamless that nobody in line (or the cashier, half the time) even notices how or that we paid, but we still think Apple should take some of tiny portion of their cash mountain and put it to good use incentivizing (and training) their customers to use Apple Pay.

SEE ALSO:
Apple Pay’s frequency of usage is putrid – August 3, 2016
Apple Pay and wannabes must offer perks to grow – December 14, 2015
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

38 Comments

    1. Don’t you get tired of being so anti-Tim Cook repetitious? I think you made your point the first couple dozen or so times you said it. Give it a rest. You won’t be kicking him out of that CEO seat anytime soon by the volume of your dissatisfactions.

      Despite people conveniently thinking i’m a vociferous defender of Apple I have my complaints as well. Believe me!

      1. No I don’t. There’s no company I believe in (or believed in I should say) than Apple. It has been a part of my life since the Apple IIe. It is beyond painful to watch an incompetent boob run the company.

        Beyond painful. It’s like reliving Sculley all over again.

            1. Looks like you have some agreement in your assessment. Bashing Apple and Tim Cook on MDN does not bring about change, as far as anyone can tell. And it doesn’t add much to the discussion.

              If someone had some reasonable suggestions on how to influence Apple, those would be appreciated. Personal attacks don’t seem to have lead to anything positive.

            2. I wouldn’t call it a “personal attack” considering his attitude. He does have a child-like immature attitude obviously. No reasonable adult would be as doggedly ad nauseum repetitive as we know this person to be. But yes you’re right, not much seems to get through. And you hit the nail on the head, he/she doesn’t offer up a solution, only armchair criticism which is easy. Appreciate your thoughts.

            3. @Birdseed is factually correct.

              You are a daily Apple apologist and cheerleader and your act has gone stale years ago.

              No credibility — get REAL. 😡😈😱

            4. Frankly my dear I don’t give a damn what you think. I’ve already just said I am NOT what you think I am, that I have my complaints as well. There is such a thing as driving the same idea into the ground which I realize is a common problem here and occasionally we’re all guilty of but not to extent Birdseed is. (And no, Birdseed is not “factually correct” especially if new Macs are about to appear and especially further if Apple has good reason for being late.) Offer up solutions is all we’re saying. Thanks for nothing. Get real indeed MeNoSense.

            5. Ditto my friend., ditto There are lots of different kinds of personalities on this site. Deal with it or leave. Or better yet come up with something much more interesting for the reader. Oh and hey “clever” use of emoji’s. Reminds me of my 8 year old granddaughter’s use of those.

            6. It’s easy to bash TIm Cook. No one can follow Steve Jobs. But please, if you want TC gone, why don’t you propose a couple of names for his replacement. Do you think the supply of persons capable of running Apple better than TC is a large group?

            7. Excellent suggestion Spark. Please Birdseed – list your qualified candidate(s) who will not be summarily derided and are truly qualified? Those that might put Apple on better footing than Number One Company in The World. Put your knowledge where your overwrought repetitious mouth is and let us befit by your CEO succession wisdom. Pretty please?

    2. Not all down to Cook mind or even Apple generally, retailers, banks and others need to commit to make it seamlessly if it is to become a habit. I see people here use it on the buses and trains because they know its works and thus it becomes automatic. Until you get close to that scenario everywhere people just will get bored with going for the phone and then have to go for their card. In the end they give up the hassle.

  1. I used it at first but found it difficult to find places who supported it and went back to old habits of sliding the card or using the chip slot on the POS terminal. Suspect that happened to many. I will attempt to go back to it, especially using my first gen iWatch.

    1. I love using Apple Pay. It’s really one of the coolest things Apple has done in a long while. I dont get how people can not think that paying with their phone is in any way slower or more difficult than reaching for a purse or wallet and extracting a credit card. That’s just nuts.

      That said, I go months, veritable months, without using Apple Pay because so few places accept it. I dont even look much anymore because I can’t remember due to the uses being so infrequent.

      Apple should have had THE most amazing advertising blitz to promote Apple Pay. 9 out of 10 people at my work who have iPhones have no idea what the heck Apple Pay is even!

      That is simply wrong and it is all due to Tim Cook’s total abdication of the leadership role of Apple.

      1. I FINALLY saw an Apple Pay window sticker at a restaurant. I want to remind those not old enough to remember that it took MANY years for credit cards like VISA and Mastercard to reach a critical mass.

      2. Perhaps there is an inverse relationship between size of phone and tendency to use as a payment device. I have noted in Japan where payment using phones have been around for far longer than Apple/Google/Samsung Pay many people paid using their clamshell/candy stick format phone. Recently with larger phone I have noticed a move to java based chipped cards over the larger format phones.

  2. MDN take is right it certainly needs something to break us from habit. people are going for their wallet/cards before they even think about using the phone, I found myself doing the same with my cards I always went to insert it before realising all I need to do was touch, its taken a year of regular use to break me from that habit, the phone is a far bigger break in habit. One thing is clear though if you had used your phone to do this on a regular basis and someone introduced a card system as an alternative we would just laugh it out of town.

    Fact is shop loyalty cards and bonus savings have to be part of this system to prod people into its benefits and break that habit.
    As an additional note, the watch is in fact a much more useful tool in terms of ease of use, because unlike your phone you aren’t competing with a card to remove from your pocket, its actually there at all times and thus more instant.

  3. In Canada, we’ve been using wireless credit cards for years now. With the added protection of fingerprint verification, using Apple Pay is a no-brainer.

    When they ask for payment method, I don’t even say “Apple Pay”, I say credit card. Zero confusion on their part, and it’s always worked everywhere that NFC is accepted.

    1. i agree with your comments about security .The problem is the amount is limited to the same amount that is authorized by tap payments brings out a lot of laziness i people .Anyone can use tap if you loose a card or if your card is cloned but Apple pay is secured at multiple levels- passcode , fingerprint and heartbeat in the case of Apple watch , which I use frequently .

  4. The ‘benefit’ is security. Swiping is to much prone to fraud. I mean really, if people are just too lazy to take security into account, maybe if they had to pay the fraud charges, they would open their eyes. But this is also, merchants and banks fault, with too many different payments systems and not knowing what works where and what doesn’t work, the banks and merchants need to get aligned.

    1. I’ve rarely had it work, or been to a place that knows Apple Pay exists. Apple should have incentivized companies to add the Apple Pay logo to their Point of Sale machines. They could do it by waiving part of the transaction fees for a period of time.

  5. What do people expect? It’s a way to spend money. Ultimately it’s not as if spending money was hard before, people aren’t going to be spending any more or less just because they can do it with their phone/watch. I paid for my Apple Watch using Apple Pay in the store app, but I would still have bought it if it wasn’t available. I just don’t see it as being something that is going to drive anything, it’s just a nice part of the overall eco-system which is nice to have but not individually a killer feature. There’s nothing wrong with that.

  6. MDN is right. Incentivise use and people will get motivated. The 1% cashback is a start, but perhaps too little to mean much to ordinary people.

    I’ve been using it for one year now. I make about 10 – 20 transactions per month on it. My thoughts:

    • ApplePay is faster than any other payment. Not a huge difference, but faster enough to save some time. The authorisation process seems faster than with a swipe, and definitely faster than with a chip;

    • ApplePay is more convenient; with the credit card, you need both hands (one holds the wallet, the other picks the card), and it takes more steps / time (pull wallet, pick the right card, pull card, swipe card, put card back in wallet, put wallet back, vs. pull phone, tap phone, put phone back).

    • What should be (but apparently isn’t) most important: ApplePay is much more secure, and allows for maximum privacy (if so desired).

    When someone is with me and observes an ApplePay transaction, the reaction is universally positive (and sometimes even incredulous: “Woooww! That is so cool, how did you do that??”). There is a very substantial portion of population that is still clueless about it. People won’t use a feature if they don’t know it exists.

    1. Whenever someone brings up time saving during payment, I have to wonder if that is really making the checkout process significantly shorter. Yes, the Apple Pay method is quick but when you consider that most grocery store purchases tend to be in carts and not 2-3 items, the time used to take out the payment card and swipe may just overlap the checkout process the cashier is performing. Saved time may actually be minimal.

      1. I’m sure in suburbia and rural America that is the case, but in cities, we can’t carry cartfulls of groceries home in our hands. I can’t remember when was the last time I used a cart in a supermarket; literally all the time I (and people around me) use the basket. In Manhattan, where people walk twice as fast as anywhere else on the planet, where they have the expression “the New York minute”, the few saved seconds are likely very appreciated.

        I do agree, the time saved isn’t much of a factor, in the greater scheme of things, but based on the reactions of people I see, if people just new about the feature, they would embrace it.

      1. I’m not sure where you shop, but over the past year, I’ve been using it almost daily, and I have yet to be asked to show anything. The worst that happens is when my bill is a bit higher ($50 or higher), I’m asked to sign the electronic pad after paying with ApplePay.

  7. 9 out 10 Swiss Francs I spend I spend with my Apple watch. It is soo convenient! The other day someone asked me “is this James Bond” or what? Apple pay on the iPhone on the other hand is of not much interest to me. Then I’d rather get my contactless Visa out.

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