Getting The Other 60% On Board

Many U.S. adults find using mobile wallets a convenient alternative to pay for things. But Nielsen says that since only about 40 percent of consumers use mobile payments of any kind, the big challenge is getting the other 60 percent on board. What will get them over the hump?

Mobile payments are starting to catch on, at least among consumers who are users of digital wallets, new Nielsen data suggest.

In its Q2 2014 Mobile Wallet Report, which the research company released earlier this month, Nielsen noted that 40 percent of mobile-wallet users say they use mobile methods as their primary mode of payment. The report, however, didn’t cite examples illustrating how mobile could play such a big role in someone’s payments activity given so few merchants accept mobile payments.

Nielsen gathered the insights for its report from a general adult population consisting of 3,784 respondents identified through its Mobile Insights syndicated study who have used their smartphone or tablet for mobile shopping, paying or banking in the past 30 days.

In examining who the mobile wallet users are, Nielsen found that men and women are almost equally as likely to use the digital service, at 47 percent and 53 percent respectively. Moreover, at 55 percent, mobile users ages 18 to 34 accounted for the majority of users, while 35 percent are ages 35 to 54.

All income levels

Mobile-payment users also span all income levels, Nielsen’s research found, with the highest use among those making less than $50,000 (32 percent) and more than $100,000 (29 percent).

“If variety is the spice of life, the digital payment landscape is on par with Cajun jambalaya,” Nielsen said in its report summary. “With innovative payment methods like PayPal, Google Wallet, Passbook, MasterCard PayPass and a host of others, the choices are plentiful.”

When it comes to check out, at 45 percent of respondent smartphone payers, bar codes and quick response (QR) codes, which consumers may display on their device so cashiers can scan them, are the most popular mobile payment methods. Twenty-nine percent of smartphone payers scan the bar code or QR code using the device’s camera. Thirty-seven percent of smartphone payers tap their device on a payment reader using Near Field Communication, such as Google Wallet or Isis.

Mobile Payments chart

Not so awkward

Almost half, at 49 percent, of who use peer-to-peer payment apps report doing so while dining, and P2P payment methods are helping relieve socially awkward situations that arise when groups of friends are out and faced with a large restaurant or bar tab, Nielsen noted in its report. After enjoying a meal and having fun with friends, 71 percent of P2P payment-app users said using these types of payment options reduces tension around splitting the bill.

Moreover, 73 percent said they liked the convenience of not having to split checks or find an ATM, preferring the simple task of clicking on their smartphones as more desirable.

Since 40 percent of mobile-wallet users are using them as their primary form of payment, marketers face the challenge yet of converting the remaining 60 percent. According to Nielsen, 69 percent of respondents said they would convert to mobile-payment methods if merchants were to offer discounts specific to purchases made via mobile wallet.

At 69 percent of respondents, many also would be more included to do so if the reward programs their use currently would honor mobile transactions, and if rewards programs and mobile wallet could be integrated to redeem points immediately.



Featured PYMNTS Study: 

With eyes on lowering costs to improving cash flow, 85 percent of U.S. firms plan to make real-time payments integral to their operations within three years. However, some firms still feel technical barriers stand in the way. In the January 2020 Making Real-Time Payments A Reality Study, PYMNTS surveyed more than 500 financial executives to examine what it will take to channel RTP interest into real-world adoption. Here’s what we learned.

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