Apple Pay is only the most recent in a long list of mobile wallets to hit the consumer market. Google's virtual wallet dates back to 2011, and Square released its version in 2009.
Still, Apple Pay has enjoyed unrivaled success in its relatively short history — despite offering many of the same features as its predecessors.
What makes Apple Pay's technology so special? More important, why should you integrate this payment option into your business?
The Secret Behind Apple Pay's Success
In truth, Apple Pay isn't really that special. It employs the same near field communication (NFC) technology found in other mobile-based contactless payment solutions. Users can link their mobile devices to credit cards and then wirelessly initiate transactions by waving their smartphones in front of NFC readers at the cash register.
Nor is Apple Pay's security a uniquely distinguishing feature. After all:
- Google Wallet already leveraged tokenization to keep users’ credit card data safe from prying eyes.
- There are countless Apps that offer a “find my phone” feature to help users locate misplaced or stolen mobile devices. You can even freeze your smartphone remotely to prevent others from using it.
- Apple Pay’s much-heralded Touch ID is hardly the first time biometric fingerprint scanning has been integrated in a mobile device.
Apple is clearly the latecomer to the party, duplicating many core features that already existed in previous devices. Yet, the 2014 launch of the iPhone 6 and Apple Pay took the retail world by storm. How does one explain this unprecedented success?
Much of it comes down to savvy marketing and fortuitous timing:
- Prior to releasing Apple Pay, the company secured agreements from more than 220,000 vendors in advance — including some of the biggest names in retail.
- Whether accidental or deliberate, Apple's launch came almost one year exactly before the EMV liability deadline. Merchants forced to upgrade their payment infrastructure suddenly found themselves in a market inundated with newer readers that could process NFC and EMV transactions.
- Whereas Google Wallet and Square were downloadable options for any users who wanted them, Apple Pay came hard-baked into the iPhone 6’s platform.
- With 800 million registered credit cards in the iTunes store, Apple didn’t have to work very hard to convert prospects into paying customers. In the first three days of launching, Apple Pay secured more than 1 million users. Those numbers have only grown since.
Why Should You Accept Apple Pay?
You should integrate Apple Pay into your business — not because it is somehow superior to earlier mobile wallets — but because it has helped solidify NFC as a mainstream payment option. Prior to Apple’s launch, it was much harder to justify making hardware upgrades, given the limited reach that NFC enjoyed in the retail market.
Though by making the switch, today:
- You will join the hundreds of thousands of competitors that currently accept NFC contactless payments – including those processed by Apple, Google, Android Pay and Samsung/ and Square.
- You will also have access to the millions of customers who have already embraced Apple Pay — plus hundreds of millions more who are waiting in the wings.
This access will only continue to expand as smartphone manufacturers, payment processors, and App developers scramble to meet growing demand for mobile-based contactless payments.