Marketers, You're Probably Not Paying Enough Attention to Mobile Wallets

Mobile passes that live in wallets offer many of the advantages of native apps

In the ongoing effort to gain consumers' attention, one effective media channel that's often overlooked is the mobile wallet.

We estimate that 55.0 million US mobile phone users will make a proximity mobile payment—one that's completed on a mobile device at the point of sale—by the end of this year. Many of those users will turn to a mobile wallet like Apple Pay, Google Pay or Samsung Pay to make those types of purchases.

Marketers can tap into mobile wallet users through mobile passes, sometimes called wallet passes or wallet cards. These passes can be controlled by brands, but are housed and accessed via a mobile wallet like Apple Pay or Google Pay.

eMarketer's latest report, "Mobile Proximity and Peer-to-Peer Payments 2018: How Starbucks, Walmart and Zelle are Leading in Mobile Payments," breaks down how marketers can take advantage of mobile wallets to reach their target audiences, while also providing a deep dive into mobile proximity payments and mobile peer-to-peer payment services like Venmo and Zelle.

These mobile passes offer a range of services beyond just payments, such as personalized messages, loyalty programs, coupons, gift cards and notifications triggered by geofences.

"It's really taking what is traditionally a static plastic or paper asset and making it a living, breathable asset on your phone. You can update it, send new content to it and—in most cases—send notifications," said Danny Ackerman, senior director of product platform at Urban Airship, a mobile engagement and digital wallet solutions provider.

In many ways, mobile wallet passes act much like lightweight apps, offering similar functionality, but with a lower barrier to adoption. They also tend to have higher retention rates compared with apps, which suffer from higher churn rates.

One of the major advantages of mobile passes is that users are opted-in to location sharing by default. Location-specific messages delivered via mobile passes can be triggered by geofencing, helping to drive in-store conversions.

"It's really easy to get [mobile passes] distributed and installed," Ackerman said. "Unlike apps, they're not taking up valuable screen real estate, they're not hogging resources. But the tradeoff is that you can't go quite as deep as you can with an app."

In the latest episode of eMarketer's "Behind the Numbers" podcast, analyst Rahul Chadha digs into some of the data highlighted in his new report on mobile payments.