The mobile wallet landscape will undergo more change and innovation in the next two years than it has since its inception. In an already crowded marketplace with no single vendor leading the charge, Yankee Group identifies which providers have the long-term vision to succeed.
Boston, MA Feb 27, 2014 - The U.S. mobile payment landscape is currently in a state of flux: Although two-thirds of consumers are interested in learning more about transitioning to a mobile wallet platform, that interest is simply not translating into adoption. While traditional payment methods continue to reign supreme, a number of third-party mobile wallets are jockeying for position in the U.S. mobile payment landscape--but not all have the vision needed for long-term survival. To endure the inevitable wave of consolidation, a well-defined roadmap paired with patience and endurance will be among the many competencies required.
In a new report, "US Mobile Wallet Roundup: Gauging the Future Potential of Today's Solutions," Yankee Group, a division of The 451 Group, ranks the staying power of Google Wallet, Isis, LevelUp, Loop, MCX, PayPal, and Square as determined by the strength of their merchant and consumer value propositions and ability to deliver on them. Based on these evaluations, the report presents five best practices vendors should follow to succeed in the tumultuous and crowded marketplace.
Highlights from the report include:
Mobile wallets remain a story of high interest and low adoption, as just 16 percent of mobile device owners have used their phone to make an in-store payment in the past three months.
PayPal has taken an early lead in the mobile wallet race. With 15 percent of consumers having used its application in the past month to make an in-store transaction, PayPal enjoys nearly four times the adoption of its closest third-party wallet competitor, Google.
Prioritizing integration with SMB point of sale (PoS) systems can lead to near-term adoption. Smaller merchants see greater value in third-party wallet solutions as compared to their upmarket counterparts.
"With the hype surrounding mobile wallets building on a daily basis, separating the signal from the noise has become increasingly difficult. The harsh reality is that despite billions in investment across the ecosystem, adoption of such mobile payment technologies has been far from illustrious," said Jordan McKee, Yankee Group Analyst and author of the report. "Just 16 percent of mobile device owners have used their phone to make an in-store payment in the past three months. More concerning, of those using mobile wallets, 73 percent are doing so fewer than five times per month. Clearly, the way we pay for goods and services is not slated to change anytime soon. But although cash and cards may enjoy dominance for some time, with fully two-thirds of consumers remaining interested, it's important to recognize that the mobile wallet is far more of a latent opportunity than a pipe dream."
About Yankee Group
Yankee Group is the preeminent research and advisory firm equipping companies to profit in a mobile world. The core of our content is proprietary research and analytics on the attitudes, behaviors and usage patterns of mobile users. We provide a range of actionable data, insights and advice to marketing, strategy and product executives driving the mobility revolution in leading companies worldwide. Visit www.yankeegroup.com.
About The 451 Group
Headquartered in New York, with offices in key locations -- including Boston, San Francisco, Washington DC, London, Seattle, Denver, Sao Paulo, Dubai, Singapore and Moscow -- The 451 Group owns and operates 451 Research, a leading technology-industry syndicated research and data firm focused on the business of enterprise IT innovation. The 451 Group also owns and operates Uptime Institute, an independent provider of thought leadership, certification, education and professional services for the global datacenter and emerging Digital Infrastructure industry and Yankee Group, the preeminent research and advisory firm equipping companies to profit in a mobile world.