With the ‘digital wallet,’ customers can leave their cash and cards at home. But it’s not just shoppers who will benefit: mobile payments open up a wealth of opportunities for marketers as well
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Why the heck am I still carrying around this monstrosity?” asks Rob, a software engineer at Google during a two-minute YouTube video that explains the benefits of the search engine’s digital wallet, which recently launched in the U.S. He’s holding a brown leather billfold that’s stuffed to the brim with receipts, cards and cash evoking George Costanza’s exploding wallet from a 1998 episode of Seinfeld.
Rob goes on to say that with the Android-powered Google Wallet application, consumers can store credit cards, loyalty cards and gift cards, and redeem sales promotions all on their mobile phone. And soon, users can use it for transit cards, boarding passes, tickets and more.
The app runs on wireless technology called near field communication (NFC) that allows shoppers to purchase merchandise by simply tapping the phone on special readers at checkout.
While several other companies including Visa have announced plans to launch their own digital wallet later this year, Google is first to market in the U.S. The technology is already in place in thousands of retailers across the country, including Subway, American Eagle and Macy’s.
Google’s Canadian launch dates have yet to be announced, but on this side of the border mobile technology company EnStream (which is co-owned by Bell Mobility, Rogers and Telus) is said to be readying its version of the digital wallet for a 2012 launch.
But with credit cards and one-click online shopping sites, do customers really want or need another way to spend money faster? Apparently, they do.
A study conducted by Leger Marketing on behalf of PayPal Canada shows that 56% of Canadians are comfortable with never having to handle cash to make a purchase. Many would prefer the use of a digital wallet to give money to others or pay for items when shopping, according to the study. (PayPal has its own non-NFC-based mobile payment solution in the works.)
Given the choice, 34% of respondents said they would rather carry a mobile phone to make a payment than a pocketful of change, and 36% of Canadians would use their mobile device to buy something as expensive as an iPod or as inexpensive as a latte.
But the benefit of the NFC chip, or whatever PayPal comes up with, isn’t only its ability to replace an overstuffed wallet or loose pocket change with a device most people carry with them everyday — though the thought is pretty appealing. More importantly it’s the opportunity to provide the user with a better, more personalized shopping experience.
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