How to Market a Mobile Wallet

By Paul Schaus

In a recent survey, more than half (51 percent) of 2,000 consumers nationwide said that they would be likely or very likely to use a bank-branded mobile wallet.

For bank marketers, that’s good news. Even though nonfinancial entities such as Google, Apple, and Android have first-mover advantage in the mobile wallet landscape, it appears that financial institutions still retain status as a trusted provider.

In addition, more than half (59 percent) of consumers want a credit or debit card from their primary financial institution in their mobile wallet.

Financial institutions are in a good position to win customer hearts and minds with a mobile wallet, but the competition from intermediaries including Apple, Google, Samsung, and PayPal is stiff. Retailers are also getting into the mobile wallet mix. For example Target and Walmart, as part of the Merchant Customer Exchange (MCX) consortium, are expanding their mobile app to include mobile wallet capabilities.

The survey asked: What mobile wallet brands do you trust for identity protection, privacy, and security? The responses were as follows:

  • Google Wallet: 38 percent
  • Visa Wallet: 36 percent
  • Apple Pay: 34 percent
  • Bank-branded mobile wallets: 26 percent
  • Mastercard Wallet: 24 percent
  • Android Pay: 23 percent

The questions for financial institution marketers include: How can my financial institution position a bank-branded mobile wallet to compete against nonfinancial providers? How can I create a marketing strategy that leverages consumers’ long-standing trust?

Here are three considerations as you think through your marketing strategy.

  1. Market mostly to a younger demographic

Not surprisingly, the research that our firm has done supports that consumers in the 25-44 age groups will be the early adopters of mobile wallets. That’s not to say that Baby Boomers aren’t interested, but the older age groups are more likely to take a wait-and-see approach to mobile wallets.

If your institution’s overall banking strategy includes attracting millennial and generation X customers, consider becoming one of the first financial institutions to provide mobile wallet capabilities and then heavily marketing your mobile wallet to current and potential customers.

  1. Invest in education

Any new technology takes time to build momentum and become ubiquitous. But when it comes to technology that is attached to money, the time to achieve critical mass is lengthened. Consumers will need to feel confident and secure entrusting their hard-earned dollars to a mobile wallet.

To better understand which factors make consumers more comfortable, our company asked them to select their top concerns about mobile wallets. Identity theft (68 percent) tops the list. Other worries, including merchant acceptability (34 percent) and ease of use (32 percent), are far behind but still a concern for consumers.

Here are the other responses to this question:

  • Don’t know how to use it: 22 percent
  • People forget to use it: 22 percent
  • Difficulty setting up mobile wallet: 15 percent
  • Cash is the way to go: 13 percent
  • No online option to purchasing: 12 percent
  • Bad experience using mobile wallet: 7 percent

Education will play a key role in helping consumers feel comfortable using a mobile wallet. In marketing and customer communications, stress how your financial institution protects customer identity information without delving into too much technical detail. However, for those customers who are interested, be ready to share more detailed information.

  1. Market more than just mobile payments

Unless there is clear value in using a mobile wallet, consumers will continue to rely on plastic and cash. Adding features such as integrated loyalty cards and coupons to a mobile wallet can encourage usage. Another feature that consumers value is the ability to access a holistic picture of their financial situation, including accounts and loans at other institutions. Think of innovative ways to give consumers control and management of their spending and savings.

Here’s how two respondents said:

  • “An ideal mobile wallet experience would be very secure and very easy to use. It should be convenient to view the balances of any linked accounts and it should be able to give you statistics on your purchasing history and warn you if a purchase might conflict with any scheduled bills.”
  • “I’d like to be able to use a mobile wallet in any store. I’d like to be able to quickly select from multiple payment options, verify my identity, touch to send the payment to the merchant, and be on my way. I’d like to get e-receipts in real time and have the transactions integrated with my loyalty cards.”

Here are the responses to the question, “What do you want in a mobile wallet?”:

  • Loyalty and/or membership cards: 58 percent
  • Coupons: 57 percent
  • Security and protection features: 47 percent
  • Checking account information such as balances and payments: 43 percent
  • Access to other banks’ credit and debit cards and account information: 24 percent
  • Direct billing to mobile operator provider: 16 percent
  • Ability to add airline boarding passes: 13 percent. The findings about mobile wallet usage were compiled in the report entitled “The Age of Mobile Wallets: What Banks Needs to Know When Considering the Creation of a Bank-Branded Mobile Wallet,” prepared by CCG Catalyst Consulting Group. Read the report summary.

Bottom line is that the mobile wallet is an extension of the payment Omni-channel and customer touch points, providing banks with an opportunity to offer services that will keep consumers loyal and help the bank retain top of mind.

To ensure adoption of bank mobile wallets, financial institutions will need to recognize the needs of consumers for security, convenience, and value-added services such as loyalty programs and coupons and market those features in order to transition customers a bank-branded mobile wallet.

Paul Schaus is the president, CEO and founder of CCG Catalyst, a management consulting firm offering strategic advice to banks. Contact him at [email protected]; telephone: (800)-439-8710 ext 201. Follow CCG Catalyst on LinkedIn and Twitter.