In what’s quickly become one of the nation’s favorite Fall events, this year’s Apple Dog and Pony Show had all eyes and ears on the Bill Graham Civic Auditorium in downtown San Francisco. With upgrades to the iPhone, iPad, and Apple TV headlining, we were of course extremely excited to dive into what Tim and Co. had *ahem* cooked up, especially any and all “one more things.”
Consumer fanfare aside, Apple also faces tremendous pressure to deliver innovation for merchants — especially this year. Make no mistake — Passbook seemed interesting as a concept, but failed as a product. Apple Pay received praise as a concept and product, but it’s still early. With Google Wallet, Samsung Pay, and other major players grappling to carve out market share, Apple needs to continue pushing merchant innovations forward.
And that’s where loyalty comes in. To overcome the chicken and egg paradox inherent in launching a mobile payments platform, consumers and merchants both need strong incentives to adopt a new technology. Let’s look at where Apple stands, and what we can expect from the company going forward.
My friends and I have a joke — true peace of mind comes from running through a single tried and true mantra before leaving anywhere: “Phone. Wallet. Keys.” As long as you can confirm possession of those three items, you’ll be fine, no matter what.
For Apple, Google, Samsung, and others, they want to make this mantra even simpler: “Phone. Keys.” (and eventually, “Phone.”). The more time we spend on our phones, the more powerful those phones become as a monetizable asset. Millions and millions of dollars stand in the balance for that company that figures out how to kick “Wallet” to the curb.
Apple Pay made signficant progress toward that goal, which is why Apple continues to invest so heavily in driving consumer adoption. The company’s latest commercial pulls out all the stops.
And here’s where the chicken and egg paradox rears its fateful head. Apple can drive as many consumer sign ups as it has iPhone users — but Apple Pay will only be successful once merchants also adopt the technology. Without consumers, no merchants. But without merchants, consumers will drop out. Both are key — and now more than ever merchant adoption has to be the focus of Apple’s strategy.
However, we all know that Apple’s historical track record here isn’t sparkling. “Wallet” used to be a bad word in Cupertino — with “Passes” all the rage. But Passbook didn’t work — yes, everyone heard of it, but nobody actually used it — and had to literally be rebranded for Apple to have a shot at earning back consumer trust.
Bluntly, Passbook failed because it didn’t provide enough utility for consumers or merchants. Sure, having a pass in Passbook was convenient for consumers, but not so convenient that any consumer demanded his or her favorite business start providing Passes. For merchants, Passbook failed to provide any actual marketing tools — next generation geo-fencing, push notifications, and easy barcode scanning failed to gain traction beyond early adopters.
Thus is the challenge for Wallet — provide more utility for consumers and merchants. Give consumers a reason to demand their favorite businesses create a presence in Wallet. Give merchants useful tools so they can get over the fact that they’re intentionally letting an Apple product take more mindshare from their customers.
When Apple Pay came out, one blind spot stood out: loyalty. Yes, consumers had an easier way to pay — leading to extremely impressive consumer adoption — but modern merchants need proprietary customer data to succeed. Apple Pay left this piece out completely.
Which brings us back to Wallet. Apple claimed that Wallet solved the loyalty problem, but in reality Wallet only serves the <10% of U.S. companies — across the board large, enterprise brands with significant resources at their disposal — who already have invested heavily in building their own loyalty program. More worrisome, Wallet doesn’t really do anything unique for merchants — essentially they can digitize what used to be physical loyalty cards. All the hassle of customer loyalty — scanning barcodes, checking in, extra steps at checkout — still exists, which means traditional loyalty program challenges will almost certainly stand in the way.
At Thanx, we love innovation, and truly believe that Wallet can help both consumers and merchants. So, we did the leg work to build a solution that will help both sides.
As of today, any merchant can have their own Apple Wallet loyalty card — in less than 2 days. Consumers immediately can add their favorite business’s loyalty card to Wallet, which will send them useful push notifications according to their preferred shopping behavior. Using that loyalty card introduces exactly zero extra steps at checkout — just pay as usual.
Better yet, merchants can access a host of 1-click marketing tools to learn more about their customers and — most important — use any of the information transacted through Wallet to create more personalized marketing for their best customers. Wallet evolves from being a branding exercise to become an actionable channel through which businesses can increase customer recency, frequency, and lifetime value.
It’s all a part of our mission to make marketing effortless. That’s what we do.