Before we start talking about Mobile Payments, let’s first talk about September.
September has always been a different kind of month.
- It’s the unofficial start to Autumn (despite temperatures hovering between 80-100 degrees),
- No other month ends on the same day of the week in any year (look it up, really).
- The NFL kicks into gear. Fantasy football becomes water cooler and Twitter fodder (more on that later).
September is also National Preparedness Month. So, it’s fitting this may be the month brands get serious about mobile payments as mainstream.
Mobile payments are not new.
Mobile Payments have been around in many forms for awhile. In many other countries – specifically those with less banking infrastructure – payments via SMS are as commonplace as text messaging (SquareCash is now offering this feature as part of their offering). Here in the US, Starbucks has become the leader in mobile retail payments (last year reporting 14%+ total sales and over four million payments via mobile app each week).
This week and next there is a blur of activity regarding the next generation of mobile payments – all with the intent of driving greater consumer and shopper adoption.
- Facing a PR issue with its brand identity, ISIS (the mobile phone consortium, not the Islamic terrorist organization), announced a name change to Softcard. Whether the name will help or not remains to be seen as adoption of this platform has been slower than expected.
- MCX (the consortium of top US retailers) announced an expanded pilot of their smartphone payments app – CurrentC – for 2014 and a full rollout for 2015. This comes after years of development shrouded in secrecy.
- Next week, Apple is expected to announce an integrated mobile wallet with the launch of iPhone 6 (including NFC capabilities). Partnerships with large financial institutions – and even some retailers – are part of the rumors. Oddly enough, the last time NFC was expected on an Apple device in 2012, Passbook was introduced as their mobile wallet.
Before addressing the impact of all this, let’s talk fantasy football.
It is September after all.
Years ago only the hardcore played fantasy football. Keeping up with stats and player moves was a huge burden for league commissioners. This problem was solved with computing power and big data leading the industry to monstrous growth in participation and revenue.
Companies that host fantasy football leagues (ESPN, NFL, USA Today Sports, CBS and smaller players like Rotowire and Fireleague) moved to mobile apps. Why? If an owner is out on a Sunday and their starting quarterback is a last minute scratch, they are done for the week and may lose the season. If one provider allows lineup changes on the fly and another does not, guess which company will be hosting the league next year?
Lately, some (perhaps more hard core players) got bored of following the same old fantasy football format year after year. They also sought greater payouts. The industry responded by creating weekly leagues which did not require a season long commitment.
The result: According to the Fantasy Football Trade Association – yes, there is such a group – over 41 million people play and spend $111 each per year. Not taking into account people’s time or ad revenue, the industry is worth over $4.5 billion dollars. Big business indeed.
Mobile payment must be big business too, right?
Despite the success of Starbucks, many mobile payment options already exist, yet adoption has lagged. Maybe due to a lack of convenience or retail acceptance. Maybe there are too many options to worry about. Or, maybe no one has yet proposed a compelling reason for people to think hard about why they should substitute one’s phone for a credit card or cash.
The announcements this month will surely change some of the above as very smart companies are engaging in the market in a meaningful manner.
But, real change to the mobile payment market will only be achieved if simple lessons learned from, yes, fantasy football are applied
1. Understand your consumer
2. Deliver on their needs
3. Create a great – even fun – experience
Here’s to a great season and a more mobile future!