Comment: How mobile wallets can reward customers and retailers

Stand in the queue at a supermarket or café and it is not uncommon to see a customer frantically searching for the right credit, debit or loyalty card. Many of us have become used to carrying wallets that are full of reward cards, some of which we use frequently, while others remain untouched for years. 

We have seen growing consumer acceptance of the mobile wallet, notably led by ApplePay and Android Pay, and it has revolutionised the way we pay for products in store. Both retailers and customers have now adopted this quick and convenient payment method and it is estimated that by 2017 mobile payments will be worth $90 billion in the US alone, making it a valuable revenue stream for bricks-and-mortar stores.

It is not difficult to see why mobile payment has proved so popular. Customers now expect a straightforward omnichannel shopping experience, and mobile, whether it be smartphones, watches or tablets, plays an important part in this. According to research by the Future Foundation, as many as 75% of people use a mobile device to search for further information about a product while in store and 73% compare product prices against other stores. 

Of course, this can result in a very different kind of in-store experience. The Future Foundation also found that 52% of those surveyed do or would use a smartphone to scan and pay for products as they went around the shop, eliminating the need for queuing at the checkout. This enables staff to focus on delivering an excellent customer experience such as offering advice or demonstrating products. 

As mobile wallets continue to grow in popularity, the next step is to integrate them with loyalty programmes. Rather than scanning a physical card, customers are already connected through their mobile device and receive their reward points as soon as a purchase is made. All this is supported by technology such as NFC (near field communication), which allows two devices to communicate with each other without the need to open an app. 

Storing transactional and loyalty data in one place has enormous benefits for both customers and retailers. For shoppers, it represents the ultimate convenience because they do not to present their card each time, nor wait for reward points to be applied. They might also redeem their points more often, helping them to feel that the brand rewards them more often for their loyalty. 

The mobile wallet allows retailers to gain insights into shopping habits like never before. Detailed analysis into purchase data, preferences and behaviours can be used to influence shopping behaviour. This includes providing personalised and relevant experiences, such as offers based around favourite or similar products and rewards, or invitations to special events. In-store kiosks have long been used to provide product information or bespoke offers, but mobile allows customers to access the same service while on the move. 

Insights gained from mobile behaviour can help retailers build a better picture of their customers. Understanding whether they use a mobile to purchase or browse, what time they open email newsletters or engagement levels on social media allows brands to target their communications accordingly. At the same time it should be noted that messaging should always be relevant, timely and never excessive. 

The uptake of mobile wallets has been rapid, not least because of the convenience they offer, and the most successful retailers are those that fully embrace mobile technology. 

While this requires investment, brands are ultimately rewarded with a wealth of information about their customers, which can be used to create tailored marketing campaigns that aim to increase the frequency and value of sales. 

For further information on mobile wallets download Ikano Insight’s whitepaper, Creating superfans through mobile engagement