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The mobile payments landscape remains fragmented and continues to rapidly evolve, with multiple stakeholders working to get a piece of a multibillion-dollar opportunity, according to a new eMarketer report, “Mobile Payments: An Updated Forecast, Early Successes and Visions for the Future.”
Payment processors, tech firms, mobile carriers, banks, credit card companies, retailers and startups are all working on a variety of strategies and technologies that aim to make mobile payments a part of everyday life.
According to a January 2013 study from Chadwick Martin Bailey, 50% of US smartphone owners reported familiarity with the concept of mobile wallet technology, with 16% of that group reporting having used the technology in the past six months. While that is relatively low usage, 22% of those already familiar with mobile wallets from CMB’s study said they were planning to use them in the future.
What is driving these early adopters to use mobile payments? According to a PricewaterhouseCoopers (PwC) study from January 2013 on mobile wallets, the majority of US smartphone owners cited saving money.
While saving money can initially draw in mobile payment users, convenience is what will keep customers coming back and paying with their smartphones. A number of studies from the UK found that convenience dominates other factors for existing and potential mobile payments users. An April 2013 study from eDigitalResearch showed UK internet users reporting that “convenience” and “quick and easier to use” were the top benefits of contactless mobile payments compared to taking cash or credit and debit cards.
According to comScore, many players are struggling to gain awareness and usage of their platforms. Aside from PayPal, which has substantial familiarity and use among consumers, Google Wallet garnered the highest level of awareness, at 41% of US internet users in November 2012, but with just 8% usage. MasterCard’s PayPass Wallet was the only other digital wallet to have double-digit awareness; offerings from Square, Visa, the mobile carriers and a handful of startups all had relatively low awareness and usage.
Patrick Gauthier, head of emerging services for PayPal’s enterprise solutions business, spoke with eMarketer and contended that the company is focused on using mobile technology to bridge the divide between physical and digital commerce for companies of all sizes. “We think that the value of connected devices is that we’re going to be able to bring the power of connected commerce to the physical realm; not necessarily the point of sale, but the entire store,” he said.
The full report, “Mobile Payments: An Updated Forecast, Early Successes and Visions for the Future,” also answers these key questions:
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