Welcome!

News Feed Item

Security Concerns and Problems at the Register Continue to Depress Mobile Pay Usage and Net Promoter Scores, says Auriemma Consulting Group

NEW YORK, Oct. 25, 2017 /PRNewswire-iReach/ -- Mobile pay usage among eligible consumers is down 5% compared to this time last year (25% vs. 30%). And the decline in adoption is expected to continue into Q4 – a period that has seen seasonal dips in Mobile Pay usage the past two years, according to Auriemma Consulting Group's Mobile Pay Tracker. This new research reveals a myriad of reasons why consumers aren't adopting mobile payments quickly, including a lack of need and interest, and that Net Promoter Scores (NPS) are seeing significant declines. But some barriers are directly influenceable by merchants and issuers alike, namely security concerns and problems at the Point of Sale (POS). 

Nearly one-third (32%) of consumers cite security concerns as a top barrier for using mobile payments. A slightly smaller proportion (21%) actually believe the method is unsafe. Auriemma's research identified specific ways mobile pay providers could alleviate concerns that block the trialing of mobile payments.

For one, 58% of consumers want issuers to assure them that mobile payments fraud will be covered by the bank, similar to card-based payments. And 57% of customers would like to see data demonstrating the security of mobile payments, with 43% wanting direct comparisons to more common payment methods such as magnetic stripe and chip cards.

"Issuers who do these things could find themselves at the top of the mobile wallet for new adopters within their customer base," says Jaclyn Holmes, the Director of Auriemma's Payment Insights. "In an environment of heightened consumer anxiety regarding data breaches, it is critical to clearly communicate mobile payments' security to customers."

Confidence with security alone, however, isn't enough to grow mobile pay adoption. Merchant acceptance is crucial for establishing habitual use, but many Pay users run into problems at checkout. These issues at the POS are a great risk to the most active mobile pay users, who experience the highest incidences of disrupted transactions.

The majority of Samsung Pay (74%), Android Pay (63%), and Apple Pay (52%) users consider themselves to be at least somewhat active. A notable proportion of each have said they encountered a problem at the register (44%, 33%, and 37%, respectively). The top reason for the issue, however, is unfamiliarity of store personnel (55%) followed closely by problems with the actual terminal, including "transaction did not go through" (46%) and "terminal took too long" (35%).

These issues have a clear impact on Pay user's likelihood to recommend the service. Auriemma research reveals sharp declines between Q4 2016 and Q3 2017 in the Net Promotor Scores (NPS) of Apple Pay (from 22 to 4), Android Pay (from 18 to 13), and Samsung Pay (from 46 to 21). While Samsung Pay's technology should render it mostly immune to problems at the POS, even it has had difficulty staying away from issues.

"One of the key benefits of Samsung Pay is that it can be used anywhere that accepts cards," says Holmes. "But even its enthusiastic user base risks becoming disenchanted by recurring issues at the POS." 

Problems at the register don't just impact behavior at the transaction-level. Half of those who had problems at a retail location that accepts mobile payments say the issue made them use the service less often overall. Problems at POS are particularly perilous for cards at the top of the digital wallet, who have the most to lose if the Pay transaction is unsuccessful. In fact, 45% of in-store Pay purchasers quit trying to use mobile payments entirely, and use a physical card instead.

There are many ways to educate those wary of the method, but the real question is whether issuers and merchants are willing to put in the time to train their customers and employees. While merchants may want to offer their customer's preferred payment method, offering it without the proper employee training and support stops mobile payment adoption in its tracks. Likewise, issuers who make their card compatible with a mobile wallet without educating customers of its benefits are forfeiting potential utilization. Issuers who want to remain or become top of the mobile wallet, and merchants looking to provide a seamless payment experience for those Pay-preferred, play a pivotal role in getting them off the ground.

Survey Methodology

This study was conducted online within the US by an independent field service provider on behalf of Auriemma Consulting Group (Auriemma) in July/August 2017, among 1,505 mobile pay eligible consumers. Respondents were screened to own an iPhone 7/7+/6/6+/6s/6s+ or Apple Watch (in combination with an iPhone 5/5C/5S) – a Samsung Galaxy S8, S8 Edge/Edge+, S7, S7 Edge, S7 Active, a Samsung Galaxy S6, S6 Edge/Edge+, S6 Active or Galaxy Note 5, Note 7 – Gear S2 or S3 watch (in combination with an Android/iPhone smartphone) – and/or other Android phone with KitKat (4.4) OS or newer. All respondents also have a general-purpose credit card in their own name. In addition to the quantitative web survey, eleven in-depth interviews (IDIs) were conducted in August 2017.

About Auriemma Consulting Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space.  We deliver actionable solutions and insights that add value to our clients' business activities across a broad set of industry topics and disciplines.  Founded in 1984, Auriemma has grown from a one-man shop to a nearly 50-person firm with offices in New York and London.  For more information, visit Auriemma's website at www.acg.net or contact Jaclyn Holmes at 212-323-7000. 

Media Contact: Diana Middleton, Auriemma Consulting Group, 212-323-7000, [email protected]

News distributed by PR Newswire iReach: https://ireach.prnewswire.com

SOURCE Auriemma Consulting Group

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
SYS-CON Events announced today that Evatronix will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Evatronix SA offers comprehensive solutions in the design and implementation of electronic systems, in CAD / CAM deployment, and also is a designer and manufacturer of advanced 3D scanners for professional applications.
"I focus on what we are calling CAST Highlight, which is our SaaS application portfolio analysis tool. It is an extremely lightweight tool that can integrate with pretty much any build process right now," explained Andrew Siegmund, Application Migration Specialist for CAST, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
As many know, the first generation of Cloud Management Platform (CMP) solutions were designed for managing virtual infrastructure (IaaS) and traditional applications. But that's no longer enough to satisfy evolving and complex business requirements. In his session at 21st Cloud Expo, Scott Davis, Embotics CTO, explored how next-generation CMPs ensure organizations can manage cloud-native and microservice-based application architectures, while also facilitating agile DevOps methodology. He expla...
SYS-CON Events announced today that Synametrics Technologies will exhibit at SYS-CON's 22nd International Cloud Expo®, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. Synametrics Technologies is a privately held company based in Plainsboro, New Jersey that has been providing solutions for the developer community since 1997. Based on the success of its initial product offerings such as WinSQL, Xeams, SynaMan and Syncrify, Synametrics continues to create and hone inn...
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
DevOps promotes continuous improvement through a culture of collaboration. But in real terms, how do you: Integrate activities across diverse teams and services? Make objective decisions with system-wide visibility? Use feedback loops to enable learning and improvement? With technology insights and real-world examples, in his general session at @DevOpsSummit, at 21st Cloud Expo, Andi Mann, Chief Technology Advocate at Splunk, explored how leading organizations use data-driven DevOps to clos...
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, discussed how they built...
The dynamic nature of the cloud means that change is a constant when it comes to modern cloud-based infrastructure. Delivering modern applications to end users, therefore, is a constantly shifting challenge. Delivery automation helps IT Ops teams ensure that apps are providing an optimal end user experience over hybrid-cloud and multi-cloud environments, no matter what the current state of the infrastructure is. To employ a delivery automation strategy that reflects your business rules, making r...
The past few years have brought a sea change in the way applications are architected, developed, and consumed—increasing both the complexity of testing and the business impact of software failures. How can software testing professionals keep pace with modern application delivery, given the trends that impact both architectures (cloud, microservices, and APIs) and processes (DevOps, agile, and continuous delivery)? This is where continuous testing comes in. D
Modern software design has fundamentally changed how we manage applications, causing many to turn to containers as the new virtual machine for resource management. As container adoption grows beyond stateless applications to stateful workloads, the need for persistent storage is foundational - something customers routinely cite as a top pain point. In his session at @DevOpsSummit at 21st Cloud Expo, Bill Borsari, Head of Systems Engineering at Datera, explored how organizations can reap the bene...
No hype cycles or predictions of a gazillion things here. IoT is here. You get it. You know your business and have great ideas for a business transformation strategy. What comes next? Time to make it happen. In his session at @ThingsExpo, Jay Mason, an Associate Partner of Analytics, IoT & Cybersecurity at M&S Consulting, presented a step-by-step plan to develop your technology implementation strategy. He also discussed the evaluation of communication standards and IoT messaging protocols, data...
In a recent survey, Sumo Logic surveyed 1,500 customers who employ cloud services such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP). According to the survey, a quarter of the respondents have already deployed Docker containers and nearly as many (23 percent) are employing the AWS Lambda serverless computing framework. It’s clear: serverless is here to stay. The adoption does come with some needed changes, within both application development and operations. Tha...
Digital transformation is about embracing digital technologies into a company's culture to better connect with its customers, automate processes, create better tools, enter new markets, etc. Such a transformation requires continuous orchestration across teams and an environment based on open collaboration and daily experiments. In his session at 21st Cloud Expo, Alex Casalboni, Technical (Cloud) Evangelist at Cloud Academy, explored and discussed the most urgent unsolved challenges to achieve f...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, examined the regulations and provided insight on how it affects technology, challenges the established rules and will usher in new levels of diligence arou...