Mobile Payments Tracker: Distractions And Donuts For Holiday Shoppers 2016

Retailers can already count on more goods flying off their shelves this holiday season, judging by consumer spending. Kiplinger reported that “continued strength in spending on food and services still signals a confident consumer.”

But can the mobile payments industry hope for a similar uptick in transactions, or is there little correlation with that and consumers’ willingness to spend? Will more consumers embrace mobile technology, along with its convenience, integrated rewards programs and avoidance of cash checking fees? Perhaps, if doing so is convenient and hassle-free. We take a look at some of the mobile news in 2016 to see what the holiday season and 2017 may have in store.

Autoplay May Not Mean Autopay

Autoplay videos are set to increase on mobile platforms and might be a disincentive to many mobile users. Apple and Google have enabled their mobile web browsers for video content to play automatically on web pages as long as the audio is muted. Marketers have latched onto this idea and are ready with videos when consumers visit a website.

But for consumers, a concern is that autoplay videos could increase the amount of data they consume through their wireless plans, discouraging them from using their phones. And, according to Pew Research, millennials are the group most concerned about running out of data (and the group most likely to use a mobile phone for payments).

Estimates by eMarketer show that digital video ad spending in the U.S. will increase by 33.8 percent to $7.77 billion, or 13.3 percent of total digital ad spending. At the same time, mobile video ad spending will soar to 70.4 percent to reach $2.62 billion.

Marketers might want to rethink. Real-Time Daily found that people find pre-video ads annoying. “If we have a DVR, we skip ads. If we have mobiles, we skip ads. If we watch online, we skip ads — and given access to the right apps, we block them altogether … Most of us don’t like being sold to, especially by someone we don’t know.”

Despite this, the powerhouses seem adamant that autoplay is the way to go; it’s more revenue for them if it’s an added product for publishers. Apple added support for autoplay video in the latest version of its Safari mobile browser, and Google added support in its Chrome for Android mobile web browser released on Sept. 7.

So, there could be more delays in the Target aisle as more shoppers are distracted by autoplay, and the fear of using up data could have mobile payers leaving their phone in their pockets — or worse, at home.

Mobile Roaming A Mess In Europe

The news from Europe will not affect the 2016 holiday season, but it might confuse mobile users in mid-2017 when the EU is proposing ending mobile roaming surcharges. This comes after a public backlash that forced the withdrawal of previous proposals limiting free mobile phone use abroad.

From mid-2017, Europeans will be able to use their personal mobile data subscription across the EU without paying extra fees and with no time limits. The European Commission is trying to wipe out roaming surcharges to create a digital single market, and it was agreed that people would be able to use their phones across the EU as they do at home by June 2017. But the mobile operators were unhappy with a “fair use” clause, and the commission was forced to rethink the proposal.

The new proposal puts no limits on time or data, but operators can “intervene if they detect abuse.” Operators will be able to charge for roaming if there are indications of abuse — for example, the use of hardly any mobile data while at home but loads of data while roaming or the use of multiple SIM cards by the same customer while roaming.

The proposals may create a lot of work for EU telecom regulators, and users are bound to complain and dispute extra roaming charges. Also, operators who want to opt out will need to provide evidence that the proposals will be detrimental.

The new proposals could encourage Euro mobile shopping if the vagaries can be eliminated and consumers can be sure they won’t be subject to high roaming charges. But as with all things EU, it all seems a bit complex, and the Brits, post-Brexit, will be left out.

News Alerts

News alerts may keep mobile phones firmly in the hands of users this holiday period. According to Pew Research, 55 percent of users receive news alerts, and about half of those again click for more information, which shows user engagement.

Looking at age patterns, although young adults follow the news less closely than older adults, they are just as likely to see the news and read it on their smartphones. And just under 50 percent will click for more information. Young adults tend to get news at the same or higher levels than older adults from digital platforms, proof that smartphones are the source of all things in the millennial world, news included.

Mobile Usage Patterns

Smartphone adoption among basic phone owners is steady. Pew Research showed that almost 80 percent of basic phone owners are unlikely to buy a smartphone in the next year — iPhone 7 or no iPhone 7.

As for popular apps among smartphone users: PayPal’s smartphone app is the popular, followed by Google Wallet, Apple Pay, Starbucks and Dunkin’ Donuts. But the Dunkin’ Donuts app is more likely to be used by non-millennials, which could round out app usage across generations, because who doesn’t run on Dunkin’?

The busy holiday shopping period is likely to see an increase in mobile shopping among millennials and Gen Xers. Seventy and 62 percent, respectively, prefer mobile payments because they receive rewards, discounts, alerts and receipts.

According to Pew Research, concerns about identity theft, loss of funds and the inability to use cash in conjunction with mobile payments were the biggest barriers to adoption in 2015, and not much has changed on this front going into 2017.

Let’s conclude then with some predictions for mobile phone usage during the holiday period and early into 2017.

Thanks to Dunkin’ Donuts, the improved economy and increased consumer spending, the use of mobile payments among non-millennials might uptick a little. Mobile phone usage among millennials and Gen Xers — 90 percent and 83 percent of whom own and happily use a mobile device — is likely to continue on its increasing trend. Well, that is as long as there are no hacking incidents to remind people of the vulnerability of their personal data, such as the breach that befell Target in 2014.

So, during the 2016 holiday season, mobile shoppers should prepare for some delays in the Toys”R”Us aisles as shoppers try to nix the autostream videos. But any delays will provide pause from the hustle and bustle during which shoppers can read or watch the news. And if shoppers fear running out of data, there is always the consolation of earning instant rewards and taking advantage of in-store discounts.