Firstly, let’s look at US consumer adoption of Apple Pay ten months in. Gallop research found only 21 per cent of iPhone 6 owners used their device to process their Apple Pay transactions – and according to Pymts.com, 60 per cent forgot about the service after using it for the first time.Here in the UK, Apple Pay is expected to enjoy a more rapid adoption because we’re much further along in the use of near field communication (NFC) and contactless payment. But you can’t assume every retailer is using the right hardware – known within the industry as a standard payment encryption device – to support NFC. If not, an upgrade will be needed. There’s also a disparity between Apple Pay in-store and Apple Pay online. Shopify is popular among independent retailers, with its software allowing them to set up an ecommerce storefront to process online sales, manage inventory/product listings and process payments – including Apple Pay. But currently the hardware and credit card readers Shopify supplies to stores don’t accept Apple Pay. The cap for contactless transactions – due to rise to £30 in September – is another hurdle to be cleared. Limiting consumer spending to some drinks in a pub or a latte at their local café will also lessen the adoption and usage numbers. But to accept higher-value payments, retailers will need to spend money and invest in terminals enabled with Consumer Device Cardholder Verification Method (CDCVM) technology. This adds an extra layer of security in processing mobile payments – and as it’s supported by payment card networks, it removes merchants’ liability for fraud when used for Apple Pay transactions. Combined, these challenges emphasise why independent retailers should focus less on supporting Apple Pay and more on their overall mobile strategy. With global mobile commerce predicted to reach $298bn in 2016 – and more than doubling to $626bn by 2018 – the key challenge for retailers is ensuring the offered shopping experience is designed with mobile phone users in mind. The traditional mobile shopping experience usually involves taking a typical online store viewed on a laptop and then cramming into a small screen. This simply doesn’t work. Read more on Apple Pay:
- Barclays attacks Apple Pay and further disturbs payment sector with bPay wearables
- What Apple Pay means for British SMEs
- Taming the fragmented sales beast: Should Apple Pay excite UK retailers?
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