Kristin R. MoyerI read an article this morning that discussed the low interest of consumers in contactless (see “Contactless Cards Go Untouched”). Consumers are rather uninterested in contactless, with 39% of consumers in one study saying they are unlikely to use contactless and 43% saying they are neutral. Analysts commenting on the results of this study said that the reason contactless adoption is low is that the industry isn’t doing enough marketing.
Marketing is not going to drive contactless. Contactless adoption is dependent on the type of transaction and incenting usage – not marketing.
Catalyst applications are important. While consumers in Gartner studies have said they are not interested in contactless, they do express interest in contactless transactions such as transit, buying a newspaper, buying a soda from a vending machine and similar. The industry needs to use catalyst applications like this for consumers to get into the habit of using contactless.
The ability to convince consumers is also important. Rewards for contactless must match or exceed those for other types of transactions. Security guarantees, presentment and analytics (to avoid being exposed to new charges and control spending activity), wallet integration (the new instrument should be integrated to customers’ financing accounts) and strong merchant brands are also important.
Contactless is not about marketing, it’s about using catalyst applications and incenting customers.
Category: payments Tags: contactless
2 responses so far ↓
1 Andy Brown March 19, 2010 at 7:39 am
Kristin, catching up on reading your blog hence a slow comment.
I wonder if some of the rewards schemes need to focus on merchants. If the merchant wants customers to use the contactless technology they will encourage people to use it. I saw Christophe’s comments using contactless in a coffee shop and the staff experiencing very few transactions. Getting the retailers staff aware of why it is good for the retailer then they can ask each customer ‘would you like to try the contactless payment – it is much easier for you (the consumer) as you don’t have to fiddle around with cash’. That would get consumers familiar with contactless so when they see unattended terminals with contactless the consumer is more likely to use it.
2 Kristin Moyer March 19, 2010 at 1:06 pm
Hi Andy, thanks for the comment. I totally agree. I have two personal cards right now, and they both have contactless. Despite being an analyst in the card space, the first time I tried to use the card I wasn’t sure exactly how to do it at the POS. The cashier wasn’t either! I figured it out on my own while the cashier waited and my kids started grabbing candy from the shelf.
You are right – partnering with merchants that know how to help encourage usage will also go along way to getting more traction with contactless. Great point, thanks.