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Debunking Mobile Wallet

  |  June 5, 2013   |  Comments   |  

Let's talk about how Apple Passbook relates to today's world and what's in it for you.

Since Apple's launch of Passbook in September 2012, the world has yet to truly embrace this mobile wallet and unleash the full potential. Why is this? Both consumers and businesses have seen or heard about Passbook but they can't yet "see" how it fits into their business or daily lives.

With any new concept, especially technology, the biggest roadblock to adoption is relating today's world to tomorrow's world and seeing the steps to get there as simple and easy. Anyone who has asked to change their current behavior needs to see and feel the WIIFM (what's in it for me). So let's talk about how Apple Passbook relates to today's world and start to debunk the WIIFY (what's in it for you).

So Passbook is mobile (some might say digital) wallet - easy, "enough said," right? Well, this is where a point of confusion sets in because of terms like online wallet or virtual wallet, which have been used to define other technologies. For example, PayPal or Google Wallet, as of today, have been called online/virtual wallets, but in reality they are only a facilitator of payments for goods and services without using paper currency.

How does this differ to Passbook? For a start, Passbook is not just about "transactions" and it is an open system.

What do I mean by open? Well, let's think about today's world, or should we say yesterday's world? A traditional wallet, let's call it a leather wallet, doesn't just hold content that serves for payment; you also stuff it full of other content that is of value to you. For example, membership cards, store valued cards, tickets, business cards, etc. Passbook is just like this leather wallet except it doesn't get fatter as you stuff more things in it.

Passbook simply replaces paper and plastic content with digital content (Passbook Passes), which makes it extremely convenient for consumers. The decision to keep in your wallet is no longer a question because you can have it all on your phone. Future leather wallet content will only contain paper currency, identification card, and maybe business cards.

Passbook's advantage, as the diagram illustrates, is that as a business you don't need anyone to download your app or a third-party app. It's built into the phone, which means over 330 million people already own this wallet and they are looking to "stuff it full."

Consumers are already starting to realize the convenience. For example, instead of printing out a United Airlines and Lufthansa paper boarding pass, the traveler simply scans her phone through airport security and arrival gate. The process and end result of getting on the plane are exactly the same. The consumer efficiency, and the "cool factor," are significantly improved. Every day I see more people tweeting how they "simply adore using Passbook and are no longer carrying paper" and they are even feeling more eco-friendly.

Businesses now need to catch up with the consumer demand. They want Passbook Passes and it's time to wake up to the massive gold rush opportunity that the mobile wallet presents with very little risk. The cost to create, manage, and distribute a pass via Passbook is not only cheaper than running an email campaign but it can prove to be more effective.

For example, a consumer walks near a retail store, which the consumer holds a loyalty card for, and a lock screen message appears notifying that the consumer can enjoy an extra 20 percent for that day. In this scenario, you are able to direct the marketing message to appear based on the consumer's location. The decision to visit the store location increases because the consumer is conveniently nearby. Compared with running an email campaign to all loyalty members, the customers have to plan their time to visit the store location, which is far less convenient.

Another benefit of Passbook, when compared to other apps, is that it can't be deleted, and while this can frustrate some people it also is driving a frenzy of people "looking for Passes." And once a brand is in their mobile wallet you have the opportunity to perpetually communicate and build a personal relationship with the consumer via their most precious companion, their phone.This doesn't mean an opportunity to spam with mass marketing messages because users still have the option to delete any pass, but rather to create a more intimate experience; and what is more intimate than the contents in your wallet?

Going back to yesterday's world...imagine if you could sneak into someone's leather wallet and personalize the content for him. Let him know of relevant, useful offers on his membership card so next time he opens his wallet he feels you really care.

As consumers become more demanding, mobile wallets, such as Passbook, present the opportunity for businesses to create more quality, value, convenience, relevance, security, and personalized experience for consumers. The added benefit is the reduction of both operational and marketing costs.

It's been less than a year since the launch of Passbook and other technology leaders are already following with their version of the native mobile open wallet (Samsung's Pass Wallet, Google Wallet). The mobile wallet ecosystem will continue to mature and as leaders of smartphone technology companies begin to drive change, user behavior follows...and you better make sure you do too.

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