3 Lessons Mobile Wallets Can Learn from Alipay
by Casey Bullock, General Manager, Global eCom – North Americas, at Worldpay
Alibaba saw record sales on Singles’ Day 2016, with $17.8 billion in revenue – more than Black Friday and Cyber Monday combined, as reported by CNNMoney. Singles’ Day began as a simple holiday to celebrate those not in relationships but in recent years, it has grown to become the biggest annual Chinese shopping day.
Given the success of Singles’ Day it’s no surprise that the company’s mobile wallet is the world’s most popular online payment method, with a reported 44 percent of global ecommerce market share*. According to a new study from Worldpay, Alipay is set to command 60 percent of global mobile wallet spend by 2020. While options like Apple Pay and Google Wallet are gaining momentum, Alipay’s head start poses a major threat to mobile wallet competitors – and its recent partnerships with Point of Sale vendors in the U.S. and Europe are only fueling Alipay’s continued growth.
Mobile payments providers and other companies looking to compete must take several strategic steps to gain a bigger piece of the global ecommerce market.
Turn mobile payments into a lifestyle choice
When many U.S. and other Western consumers think of mobile wallets, the first thought that likely comes to mind is, the ability to buy physical goods. For other types of payments or online chatting, Western consumers tend to use separate, purpose-built apps outside the mobile wallet. In contrast, Alipay has taken mobile wallets far beyond simply purchasing physical goods and turned Alipay into a “lifestyle” choice embedded into daily activities and interactions – and Western mobile wallet providers should follow suit.
For example, according to a speaking session from Alipay at Money2020 Europe, the mobile wallet is launching the Alipay Local Services Platform in more than 12 countries and regions to allow Chinese tourists to “travel like locals” while abroad. The Alipay Local Services Platform is meant to help more than 100 million Chinese tourists all over the world easily find and use local services in the Alipay app, such as shopping, searching for a restaurant, booking a taxi, ticket booking and tax refunds. All such activities and interactions can be completed within the Alipay app, rather than using several different restaurant, tourism and local deal apps. This has helped to ensure Alipay is part of consumers’ daily lifestyles even when they’re on-the-go.
Provide a ubiquitous experience
Mobile wallets should cater to all consumer needs by providing omni-channel experiences with offerings such as in-browser payments or in-app money transfers. The coming years are likely to see major technology companies, including Facebook, Apple and Google more innovatively integrate payments into consumers’ lifestyles. The recent launch of in-app money transfers from Facebook marks one of the first steps in terms of delivering a ubiquitous experience.
In addition to Facebook’s money transfer capabilities, mobile wallets from Apple and Google are being extended to in-web browsers, meaning any online merchant can support these technologies. It also means shoppers can use a single payment method both online and in-store, making the proposition much more attractive for the rising proportion of people who prefer mobile commerce. Consumers want the option to pay how they want, when they want, wherever they want. If consumers’ preferred mobile wallets are offered wherever they shop – whether online or in-store – they are more likely to build engagement and loyalty with that brand.
Make security a priority
Security is a top concern for consumers. According to the 2015 Online Payment Journey data from Worldpay, 51 percent of retail consumers know a website is a secure place to shop if they see payment authentication logos on the homepage. Additionally, consumers are skeptical of payments, mobile and otherwise, if directed to another site. In fact, additional data from the study found 28 percent of shoppers would be so concerned about security when redirected to another site they would abandon the sale all together. Mobile wallets should make sure authentication logos are clear if customers are redirected to a new page for payment, as making security a clear priority is crucial to maintaining and increasing sales.
In addition to clearly displaying payment authentication logos, mobile wallets can also capture more sales by joining a security initiative such as the World Wide Web Consortium (W3C) Web Payments Working Group or obtaining all applicable payment certifications to enhance consumer loyalty. The W3C makes the online payments experience consistent for shoppers regardless of which payment method they use and has the potential to be instrumental in harmonizing the Western mobile payments market.
Due to Alipay’s recent partnership with European and U.S. Point of Sale vendors, these markets might see Alipay popping up in store and via online shopping sooner rather than later. While many other small steps will be needed for companies to rival Alipay, these three steps can make a significant difference in gaining market share and a competitive advantage.
About Casey Bullock
Casey Bullock is General Manager, Global eCom – North Americas for Worldpay. Current responsibilities include managing all commercial personnel working directly with Worldpay’s clients in the North America region. Prior to Worldpay, Mr. Bullock was vice president, general manager fraud solutions for Chase Paymentech, and focused on the creation and delivery of enterprise-class fraud prevention capabilities into the e-commerce marketplace.
* Worldpay 2016 Global Payments Report.
Other Point of Sale news: