Mobile wallets are gaining traction

November 18, 2016

After years of slow adoption, consumers are now more willing to give mobile wallets a try. According to “State of Mobile Wallet Loyalty and Engagementin 2016” study, here are several key ingredients to continued mobile wallet adoption.

Consumers are increasingly turning to their mobile devices to complete transactions, but many need an extra push or incentive to turn mobile wallet use into a habit. In fact, almost all (94.4%) consumers would use a mobile wallet more frequently if they could earn and/or redeem loyalty points and miles with every transaction. The State of Mobile Wallet Loyalty and Engagement in 2016 is a survey distributed by Points of 1,500 U.S. consumers who are members of at least one loyalty program with the goal of understanding how loyalty impacts mobile wallet adoption and engagement. Respondents were over the age of 18, familiar with mobile wallets and a member of at least one loyalty program.

Mobile has become an important channel for loyalty programs to interact andengage with their members. In fact, nearly 3 in 5 consumers use their smartphone to display loyalty cards. While mobile wallets have been the focus of much buzz in recent years, they have seen slow adoption to date. But now, mobile wallets may have (finally) arrived, with more than 3 in 5 consumers (63.8%) saying they’ve used a mobile wallet in the past year. While most consumers (71.1%) completed between one and 25 mobile transactions in the past 12 months, a handful of others have not made any at all.

Below are the top reasons some consumers haven’t made a mobile transaction in the past year:

47% are concerned about security/privacy

45% say that credit, debit card and/or cash are enough

21% are not interested in mobile wallets

20% say it’s too complicated

12% mobile payments are not offered where they shop

5% other reasons

The study also reveals that 63% of consumers would like to see more stores accepting mobile wallets. When it comes to the most important purchasing features consumers are looking for in a mobile wallet, these are: ease of payment (84%), payment security (79%), integrated loyalty programs (61%), easy to navigate / use (50%), targeted deals/offers (41%).

To sum up, almost all consumers want a loyalty feature in their mobile wallets, so brands should give consumers every opportunity possible to earn, redeem and exchanges points and miles. Mobile wallet developers and providers should also make adding loyalty features to their products a priority. When paired with loyalty program data, mobile wallets can be used as a highly effective marketing channel, enabling brands to share more targeted offers with consumers. Personalized offers can ultimately increase consumer spending and enhance loyalty. The complete study is available here.