Report: US mobile payments market to reach $23 billion in 2016 (10 Feb 2016, The Wise Marketer)
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Report: US mobile payments market to reach $23 billion in 2016

   
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Wednesday February 10, 2016                      Tweet this article

 


The mobile payments future is finally upon us: according to market research publisher Packaged Facts, the U.S. market for mobile payments made at the retailer point of sale will increase to $23 billion in 2016, up 54% from 2015. The Packaged Facts report "Mobile Payments in the U.S., 5th Edition" projects robust growth through 2019 based on the almost certain continued movement toward smartphone usage saturation and an increase over time in the percentage of smartphone users making mobile payments at the point of sale.

Presently the market benefits from activity involving a quartet of major industry players: PayPal, Android Pay, Apple Pay, and Starbucks. Significant payment usage via the Starbucks private label mobile app and the PayPal general-use digital wallet, in addition to growing usage traction for Apple Pay and Android Pay, are at the centre of this growing industry.

The report views PayPal, with roughly 80 million U.S. account holders, as the undisputed leader in U.S. e-commerce, P2P and mobile payments. Money quote:

"[PayPal] leads with a payment agnostic, easy-to-navigate omni-channel mobile payments solution allowing users to access their accounts anytime, anywhere from any Internet connected device. Its mobile payment app runs across all major smartphone platforms, giving it strong device-based reach. Recent innovations include in-app payments, keeping mobile users within the app where they're making the payment instead of sending them to the PayPal site; OneTouch one-click mobile check-in; and a variety of mobile payment options, including photo/location-based mobile check-in, and QR code/PIN. In addition, by weaving social media into the mix, PayPal's Venmo P2P service has attracted a strong niche of Millennials to its application."

Other key trends highlighted in the research include:

  • Google has achieved parity with Apple. Invigorated by its purchase of wallet competitor Softcard and the launch of Android Pay, Google is poised to continue its gradual, upward mobile payments path. According to Packaged Facts' survey results, usage is neck and neck with Apple Pay, with 8% of smartphone users having used Android Pay at the cash register/actual sales location to pay for a transaction in the last 12 months, the percentage reported for Apple Pay.
  • Apple Pay has helped reinvigorate mobile NFC payments. Within another three years, Apple will bring mobile payments into the mainstream, on the backs of 70 million potential U.S. Apple Pay users. For now, globally, Apple has surpassed 1 billion active devices. By Packaged Facts estimates, almost 30% of U.S. adults have an iPhone, giving Apple Pay significant device-based reach. Apple Pay also blends mobile payments with features and benefits beyond payments.
  • Starbucks is a runaway industry success story. While Apple Pay and other NFC-based solutions will likely gain steam, Starbucks QR code-based solution is today's runway success story. This is due in large part to its private label, retailer-exclusive approach (the mobile app need only be accepted at Starbucks), the brand's highly engaged base of frequent users, its relationship to the company's robust loyalty programme, and its phone agnostic QR code authentication (virtually any smartphone will do). Very simple to use, it bridges omni-channel shopping and layers a plethora of added-value features and benefits into a strong loyalty/payments proposition.

You can download the full report here.


More Info: 

http://www.packagedfacts.com

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