Are Your Older, More Influential Customers Ready for Mobile Payments?

In Digital Transactional Processing, Industry Solutions, Insights, Loyalty and Rewards, Mobile Solutions by Paul Brandner

What will it take to convert this older segment of the population to adopt your mobile wallet?  Here are 5 barriers to overcome for your more influential customers.

 

by Paul Brandner
Director of Marketing

Surely it’s been said a dozen times on this blog alone: 2015 is THE YEAR for mobile payments. In 12 months, pulling out our smartphones to buy a coffee, groceries or even dinner may be as habitual as sending a text. In no time we’ll harken back with a certain disbelief: “Remember when we used to pay with plastic?” much in the same way we now try to remember life before email.

But some consumers will be slower on the uptake.

If you run a medium to large bank, chances are you’re all too familiar with this customer:

They like to bank in person. It matters that they know their teller’s name. They’re suspicious of this newfangled chip and pin business, and they most certainly have concerns about the security of mobile payments (though they have no trouble showing you photos of their married children or even grandkids on Facebook’s mobile app).

They also make up a significant portion of your deposit and investment base. These are often the same people mortgaging second homes and aggressively saving for impending retirement—if not already enjoying the fruits of it. It’s a market with considerable buying power, but one that may need convincing before they make the move to mobile payments.

A recent Verifone survey reveals that more than half (53%) of US consumers think it’s important for retailers to install devices that let them pay by mobile wallet. Even more—84%—feel prepared to pay for something small like coffee or even a pair of jeans using their smartphone. But despite a stated willingness to make mobile payments, there’s a much larger percentage of users who haven’t made them.

What will it take to convert this older segment of the population?

  1. Trusted retailers: The cost of upgrading means small businesses in the US will be slow to adopt new NFC POS systems, but for the 50+ segment, what matters more is that the big guys—the established retailers they trust—adopt the technology. When Costco does a wide scale POS upgrade to accept NFC payments in the US, then it will be legitimized for a group like the Boomers.
  2. Familiarity: Research shows users aren’t willing to change banks just for the ease of mobile payments. But it’s not just convenience—it’s also trust and familiarity. Many older customers will wait for their own trusted local bank to launch mobile wallets before they are convinced to use their phone instead of a physical debit or credit card.
  3. Security: Privacy and security concerns remain the biggest barriers to adoption. But technology like tokenization match and even surpass the security of plastic cards. While younger consumers are accustomed to typing payment data into screens, older users will need to see facts before they are convinced. The facts are that mobile payments actually have potential to reduce fraudulent activity. Educate your users by spelling it out simply and clearly.
  4. Foolproof UX: For digital natives, user flow is instinctive. For older users, adopting another new piece of technology can take a little more effort, and may be a significant hurdle for a bank to overcome. Your wallet needs to make this dead simple. Invest in a flawless user experience.
  5. Added value: For many, the main barrier is simply not seeing the benefit or ease of mobile payments. If your smartphone isn’t already an extension of your brain, then using it for payments won’t be second nature. This is when added value—coupons, loyalty/rewards, money management or P2P tools—can be the tipping point that makes it worth their while. This isn’t new information, but “value added services” are the key to changing behaviour.

Your older customer base has significant economic clout. Getting them on board, using your mobile wallet to tap and pay with ease, means you’re continually connecting with customers and always top of wallet.