Home Advice & Guides Apple Pay’s significance for business

Apple Pay’s significance for business

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Hi all, this is Naomi Burgess, giving you an insight into a new Apple product called Apple Pay and how it can help increase your business revenues.

The Apple Pay channel is a technology that allows your customers to make payments via their iPhone 6 or Apple Watch devices, using contactless transactions and fingertips scans. However, given the limited availability of such devices, this particular payment method can be considered relatively new and currently affecting only a small portion of target markets.

Apple’s Pay how it helps

Nonetheless, given the rapid way technologies are advancing, Apple Pay could very well be a symptom of a paradigm shift in customer service. In the past few months, quite a few leading UK businesses have gotten on board with this contactless payment method, and their number is likely to increase in the future. Given Apple Pay’s current limited availability, it’s likely that there soon would be other devices that have a contactless payment option. Wearable technologies are becoming bigger and more significant in many industries (and not just the fitness industry), and a scheme akin to the one offered by Apple could very well be introduced with the help of wearables.

Advanced payment options

Contactless payment methods certainly go hand-in-hand with technological advancements like e-wallets and mobile banking, but are UK retailers ready to ditch cash and Chip and Pin cards in favour of Apple Pay and its potential competitors? Are YOU ready to become a fully-fledged participant?

Of course, premium class customer service is at the heart of every business’ success, and a large portion of quite a few target audiences for several retailers consists of people who rely heavily on technology and mobile apps, so why not use those apps as payment methods as well? Indeed, Apple Pay has the potential to offer new solutions to consumers, and the lack of need for cash is just the tip of the iceberg. For instance, many British retailers now have online shops, and over two-thirds of their customers make their purchases online. Given the abundance of Apple devices on the market and the likelihood of increased sales of devices that support Apple Pay in the next few years, it’s likely that your customers would want a payment method that allows them to shop online with the help of their device, as well as in store. Besides, Apple Pay users would be able to receive personalised offers and promotions from their retailer of choice, and if you want that retailer to be you, you would be wise to consider Apple Pay; it would certainly help your business with its retention rates, amongst other things.

Apple Pay stating standards

However, would Apple Pay be likely to make things worse for smaller businesses, given that so many large retailers are on board with the method? I believe that, if Apple Pay’s usage continues to increase, the SMEs would have no choice but to also accept it as a payment type, as well as a way to engage with their clients. If they do so, given what I’ve observed above about the prevalence of technology within the target markets, their customer base would likely grow and it would make it easier for them to break into the new markets. Those SMEs that would be emerging within the next few years would see the effect of the Apple Pay method first-hand in their own industry and understand its benefits; as I observed earlier, the technology would probably be available to everyone within the next few years. And if a new retailer allows for a contactless payment method right away, they would be able to engage with their audience from the moment they open, and would retain many of their customers that way.

How Apple pay function

I mentioned above that Apple Pay could potentially face competition from the manufacturers of wearable technology that allows for contactless payment. However, this is only partly true. While Apple Pay is currently available on certain devices only, it will likely be available on more types of mobile phones, tablets, watches or other technologies in the near future, and would be included in that technology’s purchase costs. A wearable designed solely for the purposes of contactless payment, on the other hand, would involve additional expenses for the customer.

How to compete with Apple’s pay

At the moment, Apple Pay is quite a unique product of its kind, and in order to compete with it, mobile retailers would have to design something akin to the channel, with no additional costs involved. Wearables, as I said, won’t cut it for long; and if the UK retailers decide that Apple Pay is the only contactless payment method they’re willing to adopt, it would be hard for the competitors to top it. Moreover, as Apple Pay becomes more common and widespread, the sales of Apple products would also increase, perhaps even to the level of making this method a generation-level phenomenon that potentially might push out cash payments completely. So it would be quite a challenge for Apple’s competitors to operate on the same level on the market in the future, unless they act now.

Considering other contactless payment option

That’s not to say, however, that things are going to be totally easy for Apple Pay. For one, the Chip and Pin payment method has been in the UK for almost ten years now, and a large portion of the target market doesn’t show any intent in letting it go anytime soon. Given that the UK is the world’s leader in mobile banking, this particular technology is capable of evolving and the people are receptive to it. It’s therefore unlikely that it’s going anywhere anytime soon, and I don’t recommend that you forget all about it in favour of Apple Pay; you would lose quite a few customers that way. Also, many retailers have designed their own contactless payment options that can be obtained at no extra cost as part of a service package. Those businesses that truly value their customers and understand the significance of the relevant future advancements have the potential to offer their clients a payment method tailored exclusively towards them and available even to those who don’t own an iPhone 6 or an Apple Watch. Since Apple Pay is currently available on those devices only, the retailers with their own customized contactless payment methods don’t necessarily have to jump on the bandwagon just yet. If you operate one of those businesses that have a custom contactless payment system, it’s likely that you’re already aware that technology significantly influences target audiences and you at least understand the potential impacts of Apple Pay.

Whether or not you’re familiar with contactless payment methods, I would advise that you at least consider Apple Pay as a payment method for your business, particularly if the majority of your revenue comes from sales made over the Internet. Chances are, over half of your customers own an Apple device and have the opportunity to use Apple Pay, or will have such an opportunity in the near future.

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