Digital wallet technology has been around for a while, with leaders Apple Wallet and Android Pay leading the adoption from a consumer perspective. So, why are brand suddenly starting to refocus on them now? The answer comes in the evolution of what a digital wallet is and does.
One thing that originally held this idea back was the one-dimensionality of the digital wallet, i.e. that first generation wallets focussed only on payment and not on what else was in the wallet.
Where the real win is for brands is the “other stuff” that can be found in a wallet, primarily loyalty cards and coupons. The latest versions of the digital wallet act more like a life PA, not only storing loyalty and coupon information but reminding you to use them when they detect your proximity to the store or your coupon’s upcoming expiration.
What does this mean for your brand?
- You need to identify the real estate currently claimed by your brand in the physical wallet of your consumers, and then be able to replicate or improve that experience in the digital version.
- You also need to look for new opportunities offered by the digital wallet, elements that you couldn’t exploit when your space in the real world wallet was limited to a static piece of plastic or paper.
Widespread adoption is still challenging because retailers have been relatively slow to bring their in-store technology in line with what’s on people’s phones. But this is changing and you need to get ahead of the curve if you don’t want your competitors to be already sitting pretty in your niche’s “pocket” by the time you get on terms with the technology.
Soon, all brands will be able to abandon plastic loyalty cards and paper coupons in favour of a more customer friendly and marketing effective delivery via the digital wallet. Indeed many already have and are seeing an increase in store visits and customers’ spend as a result.
Here’s how the adoption breaks down right now:
- According to a June 2016 report (Urban Airship), 67 percent of millennials have used mobile wallets in the last three months, compared to 51 percent of respondents who are 35 to 54 years old.
- Sixty-three percent of respondents with household incomes greater than $60,000 have used mobile wallets in the same period, compared to 39 percent with household incomes below $60,000.
- While a slight majority of respondents are interested in using mobile payments (23 percent having already used them), nearly three-quarters of consumers will use mobile payments if loyalty rewards and offers are automatically applied.
This is definitely an idea that’s come of age, so if you haven’t yet figured out how your brand can best interact with the second generation digital wallets that are gaining ground right now, it’s time to table a meeting to discuss it.
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