Merchants Now Offer Users Branded Mobile Wallets

Retailers Encourage Customers to Use Merchant Wallets, to Further Sales

Mobile Payment
Image © Aranami/Flickr.

May 04, 2016

Mobile rules everything these days – the retail industry, especially, is rapidly adapting to the present mobile milieu. Retail trends this year clearly reveal that merchants that offer conveniences such as mobile checkout and payment are more successful than those that offer traditional payment methods. While this was expected, another surprising trend that is coming to the fore is that of retail outlets offering their own, exclusive mobile payment services, as against using universal wallets such as Apple Pay, Android Pay and so on.

An increasing number of retail outfits are offering their own branded mobile wallet services, which offer far more incentives and loyalty rewards to customers, as compared to universal wallets. Since these services are particularly targeted toward understanding user behavior better, they can also help change user behavior in a way as to help merchants drive more sales. Experts believe that, since Apple Pay and similar services cannot offer such a wide range of conveniences, users will eventually prefer merchant wallets instead.

Advantages for Merchants

These merchant-based services offer a number of advantages; especially for merchants. Some of the major benefits are as follows:

  • The greatest advantage of merchant wallets is that retail outlets can use them to keenly study user behavior, thus offering the right kind of incentives to users. The customizable nature of these services enables merchants to encourage customers to visit them more often; thereby potentially driving more sales.
  • The interactive quality of merchant wallets helps retailers reach out to customers, thereby understanding exactly what they are looking for, eventually helping them serve end-users better.
  • Merchant wallet services are usually built on distributed technology. This implies that customers will not need to keep updating or upgrading their devices in order to avail all the latest features. Universal wallets, on the other hand, are not quite so convenient to work with.
  • Distributed technology additionally enables merchants to tie up with other technologies such as QR codes; thereby making it even easier for customers to access a wider range of services.
  • Merchants’ wallets do not particularly necessitate retail outlets to keep upgrading their point-of-sales systems. This is a major disadvantage in the case of universal wallets.
  • Mobile-First Strategy: How this Applies to Retail

Merchants Offering Proprietary Mobile Wallets

  • Starbucks has upped its mobile ordering service by enabling its app users to place an order remotely, pay for the same in advance and then merely pick up their order as and when they reach the concerned store.
  • Uber, one of the most popular cab-sharing services, offers its customers a seamless and well-integrated mobile payment system.
  • Walmart’s mobile wallet system helps users get the best price for their products, also crediting their accounts in case another store offers them a lower price.
  • Target is believed to be creating a wallet, which will be integrated into its own store credit offering. 
  • In-Store Mobile Payment: The Leading Trend of 2015

Universal Wallets vs. Merchant Wallets

With the sudden rise in popularity of merchant wallets, universal wallet providers are now beginning to understand the need to offer more incentives to their customers.

Samsung Pay, for instance, now offers users a $30 gift card after they complete their first 3 purchases via their platform. These services could become popular once they start presenting more such conveniences to the user. However, this could take time to actually start showing positive results.

In the meantime, merchants would do well to offer more and more deals and rewards via their branded platforms. Additionally, integrating this service with seamless mobile payment options will further their chance of success.

Recognizing the need for some users to stick to universal wallets, several retailers are integrating their services with universal platforms such as Android Pay, Apple Pay and Samsung Pay. If they can find ways to directly engage users with their app, they can successfully shift customer behavior to make use of their branded wallet system, instead of going to another platform. 

More From Us