I just returned from an incredible 3 days in Amsterdam where I was asked to speak at the 5th annual Mobile Convention Amsterdam on mobile payments. Here are my quick observations.
First off, the topic of my presentation was “Mobile payments finish last” with the entire point being that we should stop thinking about mobile payments as the destination and more the outcome of the other things we should be focusing on. Put plainly, consumers don’t focus on paying so neither should the retailer. The experience should be seamless, painless and available – the way the consumer wants to pay.
We need to think about mobile payments completely differently than we are today. This is no longer about taking credit cards and just “putting” them on a smartphone, this is about facilitating a means to finish a transaction – when and how the consumer wants to. Most of what is out there today is an extension to the way we pay in the physical world and this won’t work in mobile. Replacing physical credit cards with digital credit cards is not mobile payments – it is credit card payments on a mobile device. There is no innovation here, just a less-effective and more cumbersome continuum. Most of today’s mobile payment technology masks the symptoms of a greater challenge. Much like aspirin or Chapstick or gum or even the Square reader, today’s mobile payments don’t address the root of the problem.
So what does? Take a look at Amazon. Their singular focus isn’t to make you pay – they don’t focus on the transaction. Instead, they have invented ways to get you, the consumer, to add the products you really want to buy to their basket. This might seem antiquated but their approach is not. They realize that no one is interested in going to their site to pay. No one likes paying for stuff – especially a lot of stuff. So they look at innovative ways to bring product in front of the consumer – away from the core Amazon services – and then make it very easy to add them to your basket for later purchase. Initiatives like #AmazonCart and the Amazon Dash are perfect examples. The focus is about getting product into the cart. Payment is not the focus, it comes later. It is the outcome, not the destination.
The mobile wallet was an area of contention at the convention. My belief is that no one wants one. The only people thinking about mobile wallets are the companies that are creating them. The value they provide today is not enough to put my personal practices aside and adopt a completely new approach that does the same thing. Sure, studies have shown that people would go home to pick up a forgotten phone and not a wallet but that does not mean they want the two together…yet. The concept of a mobile wallet is itself a half step forward. Credit and debit cards are fast and accepted everywhere these days. Mobile wallets? Not so much. One study found that more people are interested in a digital version of their drivers licence than are interested in making a mobile payment. Perhaps the first step is to give the consumer what they want to get them comfortable with the concepts and THEN move into payments and the like. Comfort and reason. Speed and security. Convenience and value. These are the hallmarks of our current payment systems that are not yet reflected in the mobile wallet offerings. Plus, if a consumer can’t use it to buy something in Albuquerque, New Mexico or Amsterdam without blinking, the system is flawed.
We are a long way off from the ubiquitous payment system we all want for mobile that is one thing that everyone seems to agree on. The problem is that we will never get there if we continue along this same path. We should not be governed by the current way of doing things. Keeping the solutions constrained by that kind of thinking means we will never move beyond credit cards, pin numbers, swipes and paper bills. Somewhere out there is the next generation Dee Hock thinking up the radical replacement for the traditional payment systems. If not, we are destined to wait until the next next paradigm emerges before we truly make payments mobile. Until then, we still have the US dollar I guess.