Loyalty Programs - Mobile Wallets on the rise

One E-commerce trend you can expect to see a lot more of in 2018 is the widespread use and acceptance of mobile wallets. More and more consumers are getting on board with Apple Pay and other mobile payment systems, becoming comfortable that such payment methods are secure and getting accustomed to quick-swiping their payment devices and dispensing with cumbersome plastic and PIN numbers whenever possible. With the mobile wallet genie out of the bottle, merchants are finding ways to reward and incentivize their use, creating programs that benefit them and their customers alike. As mobile wallet payment methods become integrated with loyalty programs, we can expect to see more E-commerce systems shaped by this symbiotic arrangement. 

Digital Wallets > IRL Wallets 

New call-to-actionThere are a lot of good reasons to prefer mobile wallets to the leather and canvas varieties, not least of which is the simple fact that they're easy and convenient to use, requiring only a swipe of your device at the point of sale. They also offer various ways to be secured (passcodes, remote deactivation) that are impossible or more difficult to implement with physical payment cards. 

Mobile wallets aren't just limited to residency on phones or tablets, either. Chip technology makes it possible for a pin, a watch, a sticker, or just about anything else to become a scannable mobile wallet device. 

International markets are wholeheartedly embracing this technology. Mobile payments are rapidly becoming the norm in China, and in developing markets like rural Africa, mobile wallets are a great way to conduct financial transactions for areas where cash is scarce and few people have bank accounts. 

All of these are good reasons why merchants are gearing up to put mobile wallet payment readers into more widespread use, but what will really be driving enthusiasm for mobile wallets on both ends of the transaction are the ways they can help consumers derive benefits and save money while boosting sales and providing useful data to merchants. 

Giving Consumers What They Want 

As they find more and more places that accept mobile payments and find that it's safe and easy to turn integrate their regular debit credit cards into the mobile wallet software on their preferred devices, consumers are gaining greater confidence in the concept of mobile wallets. What may have seemed like a frivolous novelty a year or two ago—paying for a latte with your iPhone—is just a normal, commonplace way of making a purchase today. 

Manage Chargeback In-House Or OutshoreLoyalty programs have been used by stores for many years now, providing coupons, discounts, freebies, and other rewards to customers while gathering helpful information about shopping and spending habits for merchants to make use of. The problem with loyalty programs is that many customers don't bother to use them—they sign up, then lose their cards, change the phone number they signed up with, or simply forget they even signed up in the first place. The loyalty program can seem more like an inconvenience or an intrusion than an advantage, and neither the customer nor the merchant reap any of the benefits of the loyalty program membership. 

With mobile wallets, the loyalty program can be integrated as a native element. The mobile wallet itself can communicate to the payment scanner that it belongs to a loyalty program member, and the consumer doesn't have to scan a separate card, enter a phone number, or do anything else to check in as a member. It's practically impossible to lose or forget your membership credentials. 

For the merchant, a greater consistency of loyalty program check-ins means more useful, accurate consumer data is being gathered, leading to more effective marketing and increased sales. 

The Future is Mobile 

Cash is king, the saying goes, but mobile wallets are leading a revolution that's well on track to take the throne. As cryptocurrencies like Bitcoin gain wider use, we can expect to see mobile wallets function as a way to spend them directly at points of sale without their owners having to go through cumbersome exchanges. 

Consumers like mobile wallets and loyalty programs, and technological advances are smoothing out the difficulties and issues that sometimes crop up with them. Just as we carry our music libraries on our phones or in the cloud, rather than carrying around a box of tapes or a binder of compact discs, a wallet full of plastic will someday be a thing of the past. 

Mobile wallet usage is going up and only set to keep growing, so smart players in the field of E-commerce will be looking for newer, better, and more innovative ways to provide benefits and conveniences designed to keep consumers swiping their digital payment devices. With all of the potential advantages afforded by native loyalty programs linked to mobile wallets, the store or vendor without an electronic loyalty program may soon be a rare sight indeed.

Thanks for following the Chargeback Gurus blog. Feel free to submit topic suggestions, questions or requests for advice to: win@chargebackgurus.com

Get the guide, Chargebacks 101: Understanding Chargebacks & Their Root Causes

Ready to Start Reducing Chargebacks?