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© eDigitalResearch 2012
Mobile Payment Index
May 2012
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© eDigitalResearch 2012
eDigitalResearch Mobile Payment Index
Mobile Payment Index New quarterly eDigitalResearch study looking at the uptake and general consumer perceptions of mobile payments and NFC
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eDigitalResearch
The explosive uptake of smartphone devices and mCommerce by consumers has been hard to miss, changing forever the way in which we browse, buy and communicate. The introduction of NFC technology and contactless mobile payments are likely to change all of this again and revolutionarise the way in which we perceive our mobile devices. The essential mental check list of ‘keys, wallet, phone’ every time you leave the house will soon be a thing of the past. eDigitalResearch have been tracking the development of mCommerce since October 2009 when the channel was still in its infancy. Like the Internet, we’ve watched mobile become a customer touch point in it’s entirety, driven completely by consumer demand. 2012 has been dubbed by many as the ‘Year of NFC’ when industry experts feel that everything will align and contactless mobile payments will become a major part of our high street shopping experience. With that in mind, eDigitalResearch have begun surveying consumer behaviour and attitudes towards the technology, benchmarking results quarterly and tracking changing trends. Unlike mCommerce, with mobile payments, it will be retailers, technology providers, handset manufacturers and banks who will be driving the change. Without access to the technology, consumers will be unable to use contactless mobile payments. This study, the first of it’s kind, looks to understand current consumer thinking towards contactless mobile payments and covers consumer demand to the barriers that currently stand in the way of widespread adoption.
Mobile Payment Index: Introduction
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eDigitalResearch
A survey was sent to a consumer panel between the 13th and 18th March 2012. 2,078 responses were collected in total: 1,068 were completed by smartphone owners and 1,017 were completed by non-smartphone owners. The survey covered all areas surrounding contactless mobile payments, including:
Awareness Previous use, early adopters and satisfaction Future use Perceived benefits and limitations Improvements and Regulation
The survey also looked at consumer perceptions surrounding the use of contactless mobile payment around the Olympic Games, as well as mobile apps designed specifically to make mobile payments to individuals. eDigitalResearch will continue to run the Mobile Payment Index on a quarterly basis, in order to help companies and organisations better understand contactless mobile payment use, track developments, and plan for the future. This is the first study of it’s kind.
Methodology
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Mobile Payment Index results
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eDigitalResearch Mobile Payment Index: Key Findings
Mobile payments are likely to increase over the next year, especially amongst smartphone owners
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General consumer awareness of contactless mobile payments is still relatively low. Retailers, handset manufactures, network providers and banks will all need to work together to improve this.
Results show that early adopters are predominately young males.
Satisfaction amongst early adopters is very high, suggesting that once used, consumers are likely to want to use it again.
Security is the one, fundamental concern surrounding contactless mobile payments. Providers will need to work together to help increase consumer trust.
Consumers are most likely to use contactless mobile payments at supermarkets, fast-food outlets, cafes, and public transport links, places where queuing times can often exceed customer expectations.
Almost half (44%) of those that already have the technology enabled on their smartphone devices have already used contactless mobile payments to make a purchase.
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eDigitalResearch
Security remains a key concern for consumers, and unless more can be done to reassure potential contactless mobile payment users, is likely to dampen the growth of NFC technology in the UK. Whilst the introduction of payment apps and other mobile enabled payment devices is helping to build consumer awareness, the media glare on security and other certain risks is helping to prevent widespread consumer adoption. In order for the UK to achieve the sort of NFC and contactless mobile payment growth predicted in 2012, it is essential that payment providers, retailers, banks and mobile manufacturers work together to put into place the following three essential key features:
Consumer awareness: build the public’s knowledge and address security concerns. Retailer adoption: greater awareness will build as more and more retailers encourage their customers to use the technology. Access to technology: contactless mobile payments are currently only available to a select few due to the limited number of NFC enabled handsets available on the market.
Conclusions
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eDigitalResearch eDigitalResearch Contactless Mobile Payment: Awareness
17%
36%
15%
33%
Yes, completely Yes, partly No, but I have heard of it No, never heard of it
Before this survey, were you aware of what Contactless Mobile Payments were?
67% of survey respondents have heard of Contactless Mobile Payments before, yet only 17% of people are ‘completely aware’ of what it is.
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n=2,078
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eDigitalResearch eDigitalResearch Contactless Payment: Awareness
15%
61%
24%
Have you seen any Contactless Mobile Payment Points or symbols before?
Of the 2,000 consumers surveyed, 61% haven’t seen contactless mobile payment points before, whilst just 15% claim that they have. Of that 15%, 29% live in London or the South East.
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n=2,016
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eDigitalResearch eDigitalResearch Contactless Mobile Payment: Awareness
0% 2% 4% 6% 8% 10% 12%
Other
Soft good retailers
Entertainment venues
Hard good retailers
Smaller retailers
Department stores
Restaurants
Cafes/cofee shops
Public transport links
Fast-food outlets
Supermarkets
Are you aware of any of the following types of goods or service providers that have Contactless Mobile Payment points?
Awareness of contactless mobile payment points mirrors those brands and retailers who are already investing in the technology, such as supermarkets, fast food outlets and coffee chains like Starbucks.
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n=2016
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eDigitalResearch eDigitalResearch Mobile Wallets: Awareness
7%
20% 19%
54%
Yes, completely Yes, partly No, but I have heard of it No, never heard of it
Before this survey, were you aware of what Mobile Wallets and/or Mobile Wallet payments were?
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Awareness of mobile wallets is considerably lower than contactless mobile payments. Just one third (33%) of those surveyed have never heard of contactless mobile payments, whilst over half (54%) have no previous knowledge of mobile wallets whatsoever.
n=2,016
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eDigitalResearch eDigitalResearch Mobile Wallets: Awareness
6%
20%
74%
Yes, completely Yes, partly No
Do you know how to use a Mobile Wallet to pay for goods or services?
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Consumer knowledge surrounding the use of mobile wallet technology is particularly limited. Respondents seemed very unconfident on how to actually use it to pay for goods and services and is something that all parties (retailers, technology providers and banks) will need to work on together to improve.
n=2,016
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eDigitalResearch eDigitalResearch Contactless Mobile Payments
4%
64%
32%
Yes No Don't know
Do you have a Mobile Wallet on your handset, or the ability to make Contactless Mobile Payments via your phone?
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Of those respondents who own a smartphone, just 4% have NFC technology available on their handset. One third (32%) of smartphone owners are unsure, reflecting the considerable amount of confusion surrounding the technology and reaffirms the need to increase awareness around contactless mobile payments.
n=1,904
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eDigitalResearch eDigitalResearch
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47% 47%
6%
Yes No Not sure
Have you used your phone to make a payment before, using Contactless Mobile Payment Point?
n=79
Contactless Mobile Payment use
Of the small percentage that do have NFC enabled handsets, an encouraging 47% have already used the technology to make a purchase.
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eDigitalResearch eDigitalResearch Early Adopters
68%
32%
Male Female
13%
48%
31%
8%
18-24 25-34 35-44 45-54
Results show that the majority of early adopters of contactless mobile technology are young males aged between 25-34.
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n=79
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eDigitalResearch eDigitalResearch Contactless Mobile Payments: Previous use
0% 10% 20% 30% 40% 50% 60%
None of the above
Entertainment venues
Cafes / Coffee shops
Public transport links
Smaller retailers
Hard goods retailers
Soft goods retailers
Fast-food outlets
Department stores
Resaurants
Supermarkets
Where have you used Contactless Mobile Payments?
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n=37
Over half (53%) of those that have already made a contactless mobile payment, have done so at a supermarket. Interestingly, more consumers have used the technology in more traditional retail settings than fast food outlets and cafés, despite these brands having invested more in NFC systems.
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eDigitalResearch eDigitalResearch Contactless Mobile Payment: Previous use
54%
59%
27%
14%
3%
Small purchases e.g.sandwiches
Medium purchases e.g.books, CDs, DVDs
Big purchases e.g.weekly food shop
High-end purchasese.g. holidays
Don’t know
5%
11%
17%
25%
22%
8%
6% 6%
Less than £5
£5-£10
£11-£20
£21-£50
£51-£80
£81-£100
£101-£200
More than £200
Of those survey respondents that have used Contactless Mobile Payments to make a purchase, the majority have used the technology to purchase small to medium items and on average spending £6.76 per purchase.
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n=37
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eDigitalResearch eDigitalResearch Future use
62%
24%
11%
3% 0%
Very likely Quite likely Not sure Quite unlikely Very unlikely
How likely are you to use it again?
62% of previous contactless mobile payment users said that they were ‘Very likely’ to use the technology again, whilst an additional 24% said they were ‘Quite likely’, suggesting that satisfaction with the technology is very high overall.
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n=37
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eDigitalResearch eDigitalResearch
0% 0% 0% 0%
3% 3%
16%
14%
22%
19%
24%
0 1 2 3 4 5 6 7 8 9 10
How satisfied are you with using Contactless Mobile Payment Points to make a payment?
Satisfaction amongst previous users of the technology is extremely high. 43% rate the technology extremely highly, giving a score of 9 or above. This suggests that users are likely to use the technology again, reaffirming the significance of increasing consumer awareness and confidence surrounding contactless mobile payments to encourage more first time users.
Contactless Mobile Payment: Satisfaction
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n=37
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eDigitalResearch eDigitalResearch Contactless Mobile Payment: Future use
6%
12%
34%
9%
38%
Very likely Quite likely Not sure Quite unlikely Very unlikely
How likely are you to use contactless mobile payments in the next one year?
18% of smartphone owners are either ‘Very likely’ or ‘Quite likely’ to use contactless mobile payment within the next year, whilst an additional 34% are not sure - most likely due to the fact that they currently do not have the technology available on their smartphone devices and are unsure of when this functionality will be rolled out on more handsets. It’s important, however, that mobile firms, technology providers and retailers work to increase consumer awareness and convert this segment of consumers into contactless mobile payment users.
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n=1,979
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eDigitalResearch eDigitalResearch
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Future use
24% of early adopters said that the maximum they would be willing spend using contactless mobile payments was between £11-£20, whilst an additional 22.8% said that they would not be willing to spend above £50.
Of those that said that they would be either ‘Very likely’ or ‘Quite likely’ to use contactless mobile payments within the next year, 29% are males aged between 25-34, whilst 32% are females within the same age range.
4%
29%
23%
21%
16%
7%
Male
18-24 25-34 35-44 45-54 55-64 65+
10%
32%
25%
18%
10% 5%
Female
18-24 25-34 35-44 45-54 55-64 65+
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eDigitalResearch eDigitalResearch Future use
0% 10% 20% 30% 40% 50% 60% 70% 80%
None of the above
Hard goods retailers
Soft goods retailers
Smaller retailers
Department stores
Entertainment venues
Cafes / Coffee shops
Public transport links
Fast-food outlets
Resaurants
Supermarkets
Where would you use Contactless Mobile Payments?
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Future users would be most likely to use the technology at supermarkets, fast food outlets, café’s and public transport links, where waiting can traditionally take up a considerable amount of time, and where consumers feel that they would see the greatest benefit.
n=368
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eDigitalResearch eDigitalResearch Future use
58%
35%
28%
22%
29%
13%
21%
14% 15%
23%
Happy withhow I pay atthe moment
Concernsabout
security/fraud
Have noreason to use
it
I'm notinterested in it
Unsure howthe
technologyworks
Limited placesI can use it
The Ihave/want
doesn't allowcontactlss
mobilepayments
Unsure ofwhich phones
allowcontactless
mobilepayment
Don't wantthat
technologyenabled onmy phone
Not likely toget a newphone that
allowscontactless
mobilepayment
Why are you unlikely to use Contactless Mobile Payments in the near future?
A lack of information and understanding, as well as concerns over security are major factors stopping consumers from using the technology in the foreseeable future. Other barriers include a lack of knowledge when it comes to NFC enabled handsets.
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n=1,616
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eDigitalResearch eDigitalResearch Perceived Benefits
32%
29% 29%
15%
9%
6% 6%
17%
22%
4%
15%
3%
32%
Convenientto pay with
mobile
Easier topay withmobile
than takingcash/cardswith me
Quick topay withmobile
No paperreceipts so
lesschange of
losingpersonal
info
Better ableto keeptrack of
how muchI am
spending
It's safeand secure
Less likelyto
encounterfraud
It uses thelatest
technology
It ismovingforwardwith thetimes
There arelots of
paypointsaround
Thetechnology
isavailable,
so why not
Other I don'tthink there
are anybenefits
What do you think are the benefits of using Contactless Mobile Payments to make a purchase?
Ease and convenience are seen as the main consumer benefits of contactless mobile payments. Worryingly, almost one third (32%) don’t see any benefits whatsoever. However, 56% of these are non smartphone owners and are therefore unlikely to have access to the technology in the near future.
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n=2,016
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eDigitalResearch eDigitalResearch Perceived Limitations
22%
29%
13%
34%
23%
51%
38%
7%
23%
28%
31%
4% 7%
Can only beused for certain
purchases
Not needed,can pay using
cash/cards
There is amaximumspend limit
Moresusceptible to
technical issues
Hard to keeptrack of howmuch I am
spending
Concerns oversecurity
More open tofraud
Tootechnologically
advanced
Not much clarityon how much to
pay/how it
works
Not enough paypoints around
Technology notavailable on all
phones
Other There are nolimitations
What do you see as the limitations of using Contactless Mobile Payments to make purchases?
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Security and fraud are currently the biggest barriers to widespread adoption, as well as concerns over technical issues. However, as retailers, providers and manufacturers work together to improve consumer knowledge and access, we would expect the amount of people concerned about how the technology works, access to pay points and NFC enabled handsets to decrease over the course of the coming months.
n=2,016
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eDigitalResearch eDigitalResearch Contactless Mobile Payments: Regulation
19%
40% 38%
35%
15%
34%
16%
21%
7% 10%
21%
0%
19%
1%
Who do you think should be responsible for regulating mobile payment technology?
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Of the 2,000 consumers surveyed, 40% of consumers feel that regulation responsibilities should fall to mobile phone networks, whilst 35% feel that banks should take up the mantel. Only 15% feel that the responsibility should lie with handset manufacturers and suggests that if banks and mobile networks work together to increase consumer trust, they are likely to make the biggest strides.
n=2,016
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eDigitalResearch eDigitalResearch Contactless Mobile Payments: Improvements
We asked all 2,000 survey respondents what improvements they think need to be made to Contactless Mobile Payments.
Better/Tighter security: 22.8% of respondents do not feel confident enough that
there is enough security surrounding Contactless Mobile Payments
More information: 10.34% of consumers feel that more information is needed to
help increase awareness. Similarly, an additional 6.9% felt that they didn’t have enough information on Contactless Mobile Payments to make a comment within the survey, reaffirming the importance of increasing awareness.
More pay points: 8.75% of respondents felt that the lack of available places where
they could use Contactless Mobile Payments was holding back the technology. To improve, retailers and technology providers need to look at integrating more pay points around stores, as well as branching out to all locations.
Technology available across all mobile devices: 1.3% of respondents wanted to
start using the technology yet couldn’t because NFC technology is only available to a select number of mobile users. We would expect this figure to drop though as more and more popular
makes and models include the technology.
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eDigitalResearch eDigitalResearch
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Mobile Payment Apps
After the introduction of Barclay’s Pingit app, we decided to ask consumers what their views and opinions were on this type of technology and how possible widespread adoption is likely to be.
6%
12%
34%
9%
38%
Very likely Quite likely Not sure Quite unlikely Very unlikely
How likely would you be to use an app like Pingit to make payments if your bank introduced the same technology?
75%
41%
16% 23%
13% 20%
16% 12% 11%
1%
Never heardof it
Not aBarclayscustomer
Phone notcompatible
Happy withhow I pay atthe moment
Concernsabout
security/fraud
Had noreason to use
it
I'm notinterested in
it
Unsure ofhow the
technologyworks
Don't knowanyone else I
can use itwith
Other
Why have you not used the Barclays Pingit app?
n=1,632
n=1,969
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eDigitalResearch eDigitalResearch
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Mobile Payment Apps
31%
15%
55%
More likely to trust it Less likely to trust it Doesn't make a difference
Are you more or less likely to trust this method of payment if it is being endorsed by banks?
Again, general consumer awareness surrounding this type of technology is very low, with 75% of those surveyed claiming that they had never heard of the app. However, there appears to be a lot more trust of this type of technology when compared to contactless mobile payments, with just 13% of the 2,000 surveyed claiming that they had concerns over security and fraud. Almost 1 in 5 (18%) said that they were likely to use the technology if their banks introduced a similar app, whilst an additional 34% are not sure, suggesting that if more information is provided to consumers, then uptake may be higher.
n=2,016
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About eDigitalResearch
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eDigitalResearch eDigitalResearch eDigitalResearch mobile insight solutions
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App mCommerce In store QR
codes
Mobile detection technology Automatically detects when a user is accessing a survey through a PC or mobile device (smartphone and tablet) and serves them either a standard or mobile enabled survey
Currently tracking around 10% (+100% yoy) survey completes from a mobile or tablet device for all eDigitalResearch surveys
‘Younger fashion’ most popular sector for completing surveys on mobile
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eDigitalResearch eDigitalResearch
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Mobile Marketing Research Association
eDigitalResearch are very proud to be a Founding Member of the MMRA
eDigitalResearch, along with other members, will be working alongside the MMRA to develop and promote professional standards and ethics in mobile market research.
eDigitalResearch’s mobile studies include: • Tracking rise of mCommerce with consumers
since October 2009 • Benchmarking emerging mobile retail sites
since August 2010 • Benchmarking mobile retail Apps since April
2010 • Comparing cross channel consumer experience
across eChannel’s since December 2011
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Who we are and what we do eDigitalResearch
Company Partners
We are migrating traditional market research to digital methodologies • reducing costs – fixed pricing model • faster results – real time results • improving accuracy – no response or panel limits
We are developing and introducing innovative research solutions • social networking (digital communities) • maximising respondent engagement • industry norms/benchmarking • mCommerce/mResearch
We are one of the leading providers of digital market research • established in 1999 by current directors/owners • self funded, financially secure, clear ethics • own system with outstanding technical support • team of research professionals
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Product Overview eDigitalResearch
• ‘Closed group’ research • Usability &
‘end to end’ experience • Benchmarking
eMysteryShopper
Verbatim Coding
• Automated qual-to-quant text analysis •Full reporting of
verbatim comments across any digital
medium
• ‘Open’ user research • Visitor/user opinion • Key performance
indicators • Brand advocacy
eDigitalSurvey
• Omnibus research • Client panel management • Media panels
ePanelManager
• Web 2.0 • 3 way dialogue from
profiled users • Product ratings
• Net chats
eDigitalCommunity
HUB Insight and
Analysis
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Vanbrugh House, Grange Drive
Hedge End
Hampshire SO30 2AF
Tel: 01489 772920
www.edigitalresearch.com
@eDRtweet
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Key Contacts:
Lisa Bonczyk – Associate Director, Sales and Marketing–lisa.bonczyk@edigitalresearch.com
Liana Vickery – Marketing Executive - liana.vickery@edigitalresearch.com
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For a bespoke research programme designed specifically to gain insight and understanding into your mobile audiences, please
contact Lynda Baker, Business Development Manager at
lynda.baker@edigitalresearch.com Similarly, if you would like more information on the results then
please contact eDigitalResearch by emailing info@edigitalresearch.com