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Apple Pay Spends 2016 in Midst of Big Gains

January 27, 2024         By: Steven Anderson

For those who thought that Apple Pay’s walled-garden approach to mobile payments would inherently limit its operations and ultimately hamstring it, there’s a bit of contrary proof floating around on that that recently emerged.

More specifically, the number of transactions connected to Apple Pay was up 50 percent between December 2015 and December 2016. That’s a pretty impressive gain, but it wasn’t gained without some trouble in the process.

The good news was that not only was there a substantial percentage hike overall, some stores saw particularly large gains. Duane Reade, a convenience store chain, saw 1.8 percent of all credit card transactions run through Apple Pay, and Whole Foods saw a comparable amount with 1.7 percent.

That’s where the problem kicks in: all other in-store retailers taking Apple Pay turned in sub-percent numbers, with Starbucks running dead last at 0.4 percent. Online and in-app payments fare better, though, with Hotel Tonight leading the way at 3.4 percent, and food delivery services like Caviar and DoorDash ranging between 3.3 percent and 2.45 percent.

A Dilbert strip from 2008 once featured a marketer noting that sales were up 100 percent over a recent period. Dilbert, in his own special way, noted that the big percentage increase involved a “trivial base”, which basically means that sales increased in grand fashion, but were still minuscule thanks to the fact that they didn’t start out with much.

It’s the jump from one to two: double the size of one, but still a very small number. Apple Pay is experiencing this kind of growth: huge on a percentage basis, a lackluster outing in real numbers.

It’s worth noting that we’re still in early days as the mobile payments phenomenon goes. There’s no shortage of time for Apple Pay and its various competitors to pick up the pace and become an ever larger part of the overall landscape. Only time will tell just how far we can go with mobile payments, but it’s a safe bet we’ll see more rather than less in the short term.