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As of yet, no company has cracked the mobile wallet space. But that doesn’t mean it won’t happen eventually. The tipping point, according to Forrester Research Inc., hinges on seeing mobile wallets as a marketing platform. In a new report, “The Future of Mobile Wallets Lies Beyond Payments,” the Cambridge, Mass.-based research and consulting firm argues that companies that can successfully build a mobile wallet that also doubles as a marketing platform will “win” because they actually will be giving consumers what we want: a better, more personalized shopping experience.
The thesis resonated with me. I first heard of this concept of mobile wallets being about more than just payments when I visited Paydiant, a Boston-based startup which provides the technology behind the mobile pay app CurrentC. I was there to film for my Startup Spotlight series (check out Paydiant’s video here). Paydiant’s co-founder and head of products and marketing, Chris Gardner, in fact, said this is one of his company’s big missions: “We have to prove what we’ve been saying for the last three or four years. [And that] is that mobile’s a marketing platform; it’s a very powerful way to interact with your consumers and it’s not just about payment.”
Companies like PayPal, Apple, and Google have seen the light, according to the Forrester report.
“Apple Pay is critical in that it offers consumers a more secure and convenient checkout experience. However, the key to Apple’s wallet lies in the central role of Passbook, where consumers can easily save and organize branded content,” the report said, referring to the content that blurs conventional advertising content with editorial content, or other content, making it difficult to differentiate what is advertising and what is not.
Google, for its part, is not focusing on payments but instead is more interested in the transaction data in order to use that information to strengthen its advertising business.
Forrester predicts that brand name companies will have to figure out how to partner up with mobile wallets if they want to keep their marketing messaging front and center with the mobile device-carrying-hoards.
How companies can take advantage of mobile wallets
Forrester advises marketing leaders to take advantage of this emerging opportunity regardless of who wins the mobile wallet war.
“Marketing leaders will benefit from mobile wallets if they tie together loyalty programs, coupons, product discovery, gift cards, and promotions to create powerful and new brand experiences in the mobile moments of their customers,” the report said.
Here’s Forrester’s advice for marketing leaders to make the most out of what mobile wallets have to offer:
- Test existing mobile wallets’ marketing capabilities. Players like Urban Airship, Passkit, Passworks, and Vibes, all mobile marketing solution companies, can help marketers manage mobile wallet campaigns by driving foot traffic, and updating content and offers, the report said. These campaigns are valuable because they “will let marketers know the most efficient distribution channels (e.g., SMS, email, direct mail, or mobile ads) to engage customers within mobile wallets,” the report said.
- Plan for relevant, location-based, real-time offerings. To make the most of mobile wallets, the report said, marketers will need to strike a balance of adding location and time-sensitive offers to their approach without being too invasive or intrusive. Unfortunately, more often than not, brands tend to have imprecise location information about their stores, the report said. Marketing leaders need to be very precise and know what notifications to send when and based on the customer’s location. For example, sending push notifications once a consumer is at the entrance to the mall, the front door of the store itself, or even in specific areas of the store. The report said that some startups, like Tapcentive, can help marketers achieve this.
- Mobilize loyalty program and regularly update branded content. Marketers should pay attention to how mobile is changing customer loyalty, the report said. This is because access to loyalty rewards is in high demand from consumers and happens to be the one that is the least integrated in mobile wallets today. The report said that third-party mobile wallets will offer the opportunity and can help to integrate basic rewards features for frequent shoppers. A key success driver, the report said, is the ability to update brand content and make it socially available.
Let us know what you think about the story; email Kristen Lee, features writer, or find her on Twitter @Kristen_Lee_34.