Mobile wallets are an effective way of reaching consumers but are often overlooked by marketers, according to a new report from eMarketer.
Mobile payment services like Apple Pay, Google Pay and Samsung Pay allow shoppers to make a payment by simply tapping their phone at the checkout. As well as storing credit and debit card details, they can include loyalty cards, coupons, business cards and tickets.
As eMarketer explains, marketers can tap into mobile wallet users through mobile passes, sometimes called wallet passes or wallet cards. These passes can be controlled by brands, but are housed and accessed via the mobile wallet.
“It’s really taking what is traditionally a static plastic or paper asset and making it a living, breathable asset on your phone. You can update it, send new content to it and — in most cases — send notifications,” said Danny Ackerman, senior director of product platform at Urban Airship, a mobile engagement and digital wallet solutions provider.
Mobile wallet passes act like lightweight apps, offering similar functionality, but with a lower barrier to adoption. They also tend to have higher retention rates compared with apps, eMarketer noted.
What’s more, users are opted-in to location sharing by default — allowing them to receive location-specific messages triggered by geofencing, helping to drive in-store conversions.
Although mobile wallets are yet to reach mass adoption levels, they are growing in popularity as consumers become increasingly familiar with contactless and mobile payments.
Juniper Research estimates that, driven by payment cards and mobile wallets, in-store contactless payments will exceed $1tn (Â£790bn) this year and will reach $2tn (Â£1.57tn) by 2020, representing 15% of all point of sale transactions.
Apple Pay, Samsung Pay, Google Pay and other OEM Pay wallets will have an estimated 450 million users by 2020.