Could Retailers’ Refusal of Mobile Payments Cost Them Big This Holiday?
With the leaves largely off the trees, night coming on just a little earlier every day, and the end of the year approaching, most of us start thinking about turkey dinners, time with family, and maybe some shopping in the meantime to get ahead of our Christmas lists.
For many shoppers, this means firing up the smartphone to make some payments, and increasingly, retailers are taking this to the bank. Not every retailer is so forward-thinking, however, but will that matter? The bad news is, it does matter, and reports suggest there’s a price to pay for failing to keep up.
That having been said, the good news is that this price isn’t as bad as some might think. Credit card accounts are on the rise, and have been for some time.
New credit card issues were up 11 percent in the second quarter of 2016 against the same time in 2015, bringing the total to 84.9 million. That means a lot of people ready to pay with a credit card rather than a mobile payments system.
This is supported by National Retail Federation senior vice president and general counsel Mallory Duncan, who said “Apple Pay is … not even a rounding error off of the merchants’ bottom line. So, it will not affect their holiday season this year if they don’t offer it.”
What Duncan said, however, represents the biggest potential pratfall businesses can take. “This year.” While mobile payments in general are still a small part of the action, there’s the issue of perception to consider. Failing to have this platform in place could risk alienating the millennials, who enjoy mobile payments more than any other demographic.
That could represent problems down the line, especially as the millennials step into their prime income and spending years.
This is still a fairly young technology, so while it’s a good idea to bring it in as soon as possible to not risk alienating a major market, those who haven’t made the leap yet don’t need to start advertising their going out of business sales for 2017. This year isn’t much of a risk. Next year, however, could be a different matter.