The Long Road To Mobile Adoption

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Accenture’s latest consumer survey results underscore what we hear again and again: Consumers are aware of mobile payments; they just don’t use them. Robert Flynn, Managing Director, North America Accenture Payment Services, provided MPD CEO Karen Webster with an in-depth look at consumer payments trends and what needs to change in order to drive usage.

The digital payments evolution is here, but are consumers really ready to ride the wave?

Accenture’s 2015 North America Consumer Digital Payments Survey explored the buying patterns, frequencies and methods of payments for 4,000 customers throughout the U.S. and Canada to find out.

The results not only provide insight into the ways in which people pay now but also explore how consumers feel about how payments will change in the future.

CONSUMERS ARE AWARE BUT…

For now, the awareness of mobile payments has reached its highest point ever among customers, with nearly 52 percent of respondents saying they know they can use their mobile devices to facilitate transactions.

But what Flynn said was most surprising is that while awareness is at an all-time high, usage is still relatively low, with the adoption of payments via mobile only being 18 percent of the customers surveyed.

Flynn added that these numbers are very telling because they show that even though consumers are aware, they still are not taking any action, which begs the question of what it will take to get the needle moving and incentivize customers to start using their mobile phones for payments.

Not only did the customer responses point to a significant gap between awareness and adoption, it also identified what could be the key to closing it.

According to Flynn, many customers admitted they would be more likely to respond to using their mobile devices for payments if the incentives, particularly those that are loyalty-based, were there.

“But these are not the same loyalty offerings that we are probably thinking of today where you just collect points in an account but actually loyalty that goes beyond that and integrates with other parts of the experience,” Flynn said.

MOBILE PAYMENTS DEALBREAKERS

The dealbreaker in the adoption of mobile payments could be the fact that consumers want to be incentivized with pre- and post-purchase experiences, such as coupons, discounts and accelerated checkouts.

The survey found that 79 percent of smartphone users would be more likely to actually use their mobile phone for payments more frequently if those different incentives were offered.

To see a great example of this in the market today, Flynn said to look at what Starbucks has done with its Mobile Order & Pay feature, which has actually resulted in real month-over-month differences just by implementing that single post-purchase change.

Another surprising trend found in the survey results is that cash is not dead.

In fact, it is very much alive, with a whopping 67 percent of customers reporting that they still use cash on a weekly basis.

“Overcoming the habits and simplicity of reaching into a wallet and pulling out cash is very hard to beat, even with the most sophisticated devices,” Flynn explained.

“Since last year there has been a slight growth in the number of consumers paying with their smartphones but not as much as you would expect. Cash is very simple and immediate. We are creatures of habit, so I think a lot of this is about time and friction,” he added.

CASH IS KING … BUT FOR HOW LONG?

While the use of cash may be reigning supreme now, things have the potential to change drastically over the next five years.

“When we asked the consumers about what they expect to be using for payments and frequency in 2020, one of the notable points is, with cash, they actually expect to be using it quite a bit less,” Flynn noted.

On the flipside, some forms of digital payments are expected to increase in usage by as much as 50 to 80 percent between now and 2020.

The reason why merchants are even stepping up to accept so many different payment methods (exactly 13 were analyzed in Accenture’s survey) is because of the power of consumers’ preferences at the point of sale.

If payments providers want to ensure that adoption aligns closer with awareness, then meeting customers’ needs and providing exceptional commerce experiences are key.

“The opportunity for adoption is going to be about changing that pre- and post- purchase experience. The data clearly indicates that that’s going to be a big opportunity,” Flynn stated.

“I think we are going to see an increase in loyalty and incentives pre- and post-purchase to the point where the purchase becomes invisible; it becomes easy.”

Learn more by taking a look at Accenture’s infographic surrounding their 2015 North America Consumer Digital Payments Survey…