Will Retail Payments be the Killer App for Mobile Wallets?

What do you do when thousands of mobile industry leaders from around the world get together in one place? You take their collective pulse with a survey, of course.

This was the third annual Sybase 365/SAP Mobile survey of the operators, fixed telco providers, over-the-top players and other industry execs at the GSMA Mobile World Congress in Barcelona. (Full disclosure: SAP is my employer.)

The results show that the majority of respondents (53 percent) think that the ‘killer apps’ that will drive consumers to start using mobile payments will be retail apps—over money transfer, person-to-person payments and mobile top-up. Further, they say the ‘secret sauce’ for a successful mobile payment scheme includes location-based offers (24 percent) targeted to people near or inside a retail store, better experiences at the point-of-sale such as what NFC might offer (28 percent), and near-universal acceptance like we have today with credit cards (25 percent).

The mobile payments market is definitely maturing. What began as a largely person-to-person payment method must now evolve to tackle the challenges of the retail environment. Mobile wallet apps must improve the payment experience for consumers, compared to previous versions, as well as compared to cash and credit cards. They also must support a multitude of complementary services such as loyalty and couponing. (Maybe the industry will soon be able to agree on what constitutes a mobile wallet?)

Comparing this year’s results to last year’s, the industry appears to have a slightly different opinion about who will be leading the charge on mobile payments. This year, respondents said banks (29 percent), online payment schemes such as PayPal, Apple iTunes and Amazon Payments (28 percent), credit cards (26 percent) and operator consortiums (26 percent) are in the best position. In contrast, last year, the results also had banks (24 percent) and mobile operators (26 percent) in the lead, but placed less stock in credit cards (10 percent) and online payment schemes (19 percent). (This was a ‘tick all that apply’ question—in case you’re doing the math and getting more than 100 percent.)

Regarding the impact of apps like Apple Passbook and Google Now, 34 percent said they would encourage brands to offer wallet services, just 28 percent think they’ll become an alternative to true mobile wallets, and 38 percent believe that consumers’ lack of awareness and/or confusion about all the different offerings are holding mobile wallet services back.

What do you think?