Apple Pay

PYMNTS Apple Pay Weekly Recap: The Week of Bugs, Beacons and Buyers’ Remorse

Want some fodder for that next water cooler convo? Here’s our weekly take on what’s movin’ and shakin’ across the Apple Pay Ecosystem.

Uh oh. Apple Pay has not only grabbed the payments headlines but some people are saying it’s why Bitcoin has tanked, falling from about $472 the day Apple launched to a low of $391 ten days later. Of course maybe its just coincidence and the price is back up to about $410. But who’s to know what’s really driving bitcoin. Meanwhile Apple stock tanked yesterday. Personally I’m blaming it on David Evans’ “stop drinking the Kool-aid” column we published yesterday so all you Apple shareholders know where to direct your ire.  But, then with the crazy tech stocks, maybe it’s sun spots. Meanwhile, More likely, we’re seeing a week where consumers are starting to use their iPhone 6’s and its new operating system, and  are starting to complain – and loudly  –  about everything from its size to its functionality to its buggy operating system.

Say hello to iBeacons Among the many upgrades to the iOS8 ecosystem is the inability now for retailers to track a shoppers patterns via WiFi. The new OS generates a new MAC address each time a consumer enters a store. So, even though offers and promotions can be served to a consumer in the store, there is no way for a retailer to know if that shopper ever returns. Well, unless they enable iBeacons. Need I remind you how Apple makes money? Hardware sales! With oodles of iBeacons, merchants can  track and analyze to their hearts content. Look for the mashup of iBeacons and Apple Pay coming to store near you very soon.


Of bugs and buyer’s remorse.
Okay, so change of any kind is really hard.  And when it comes to changes that affect a device that’s as personal as mobile phones have become to all of us, there’s a pretty sizeable risk that someone, somewhere is going to be disappointed when moving from one model  to another.

And, that is exactly what’s dominated the news cycle about Apple over the last week. Even its dedicated legion of fanboys and especially fangirls are pushing back.

A buggy operating system that impacts functions as basic as making and receiving a phone call (phone calls go right to voice mail and never ring on the phone, if they happen at all) and getting email (it crashes a lot) and moving apps to the new phone (the data never seems to make it with the app) on top of the shock of just how much bigger the phones really are seemed a bit too much for people to absorb without letting their real feelings be known.

In all fairness, people expect software to be buggy and people will squawk a lot but know Apple will fix and fix quickly. After all, all of us with our iPhone 6’s are early adopters anyway so are willing to trade off a lot for the benefit of having it first. And, Apple has already dialed back one update since it apparently wasn’t good enough to address all of its issues. Keep in mind, Apple has some of best engineering talent on the planet and they’ll get that sorted. What’s not so clear is the issue related to the size of the phone itself and what impact that might have on payments.

I got a new iPhone the very first day it was available and I have to say that my Twitter hashtag earlier in the week said it best –  #notinlovejustyet. I miss my old iPhone. It was the perfect size for me and my hand – for making calls, for checking email on the fly and for using apps to pay for stuff at the point of sale. And that’s what I want in a phone. I have an iPad and an iPad mini for consuming content. My phone, is well, my phone.

When it comes to mobile payments in store, with my old iPhone, I could grab a coffee and use only my right hand to pop open my app and pay at my favorite coffee shop –  without having to put my coffee down.  That was a real benefit since I didn’t have to do a lot of juggling with my handbag . My old phone also fit really well into my various handbags and the little mobile phone pocket that is in them. Ditto my skinny jeans and a variety of much beloved leather jacket pockets.

No more. I am now facing the classic handbag and wardrobe malfunction and a big commerce conundrum all rolled into one.

When I show people my iPhone 6 the first question they ask me is whether I got the big one (I didn’t). That’s how much larger the 6 is from the 5 or 5s. And, granted, my hands are certainly smaller than a man’s hands are, and clearly I wasn’t the one  used for consumer usability testing. But I now find the phone very hard to use with one hand. My morning coffee shop experience is now a two-handed process, with me setting down my coffee to move my phone to my left hand so that I can pop open my app and then use it. Let me tell you, the people behind me in line are not at all impressed that I am doing all of this with a new iPhone 6 in hand. Neither is the cashier who just wants to move the line along.

Sure, tapping the screen twice shrinks the screen, but that’s not the issue.  My one hand isn’t big enough to hold the phone comfortably.

I’ve also pretend-practiced using it the way Tim Cook showed us at the launch: thumb on TouchID and pointed at the terminal. Now, Rob Gronkowski, the Patriots receiver whose hands are as big as baseball mitts, will have absolutely no problem. But  for me, the center of gravity of the phone when I hold it that way makes me feel like I am going to drop it. So not only is the experience different, for me, it is uncomfortable.

Then, of course, there’s the handbag and wardrobe situation. Ordinarily, I would be ecstatic since I’d have the perfect (and legitimate) excuse to run all over the place and buy new clothes and handbags. But even that won’t help right now.  No one has changed their manufacturing specs to accommodate this larger size nor is it clear that they will.

So, since women drive about 75 percent of the spend, this could end up being pretty bad for the overall adoption of Apple Pay, well at least as it was originally conceived for in store purchases. All of those Moms who were used to juggling children and purses and phones at the point of sale, now have one more thing to juggle.  If they use it! And that’s a big question for Apple.  Are people really going to use this phone to wave at a terminal?  I’m not so sure anymore that women will.

There is one thing, of course, that still fits into all of my handbags, my skinny jeans pocket and all of my jackets – my thin, light and old-fashioned credit card. That’s the competition that not just Apple Pay, but every mobile payments player must overcome for in store payments. And that means the incentive must about be much more than payments. If I’m going to juggle my coffee and rejigger my handbags and pockets to accommodate the new iPhone, it better be worth the trouble.

But then, there’s always online – and that’s where the stars are aligned for bigger phones for surfing and shopping and frictionless payment. And, that’s where Apple Pay and its SDK and burgeoning ecosystem is pointed. In store payments may be the buzz right now but online payments is where we’ll likely see Apple Pay pick up steam. No juggling necessary.

 

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. The May 2019 AML/KYC Tracker, provides an in-depth examination of current efforts to stop money laundering, fight fraud and improve customer identity authentication in the financial services space.

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