No Wallet, No Problem?
I didn’t realize I had forgotten my wallet until I stopped at the gas station and discovered I wasn’t able to pay for the gas I needed. It was the second time in less than a week I had forgotten my wallet, and both times my phone was to blame: I left the house texting or talking, completely forgetting that my phone is not a universal key-wallet-communication device. At least not yet.
If the number of headlines devoted to mobile payments over the past few months had any type of direct relationship with the actual amount of money you can exchange via mobile for tangible goods (like gas…), forgetting my wallet shouldn’t have been a problem. Unfortunately, despite the hype among reporters, investors, and entrepreneurs, at the moment options for mobile payment remain limited. But, we’re starting to see some really cool stuff that’s driving mobile payments closer to the mainstream: the Google Wallet, and Square’s Card Case both launched in the past few weeks, Dwolla has greatly expanded their offering, and a number of start-ups (Jumio and Bling Nation pt. 2, among others) look poised to join (or re-join) the scene.
As elegant and fun as these payment methods are, will they provide enough value to convince consumers to ditch their cash and credit cards? I’ve been working on a research report here at Thomvest looking at how the payments industry will fit into mobile commerce, and have begun to grasp the market dynamics and participants. I’ve found plenty of forecasts and opinion pieces, but almost no authors have actually used the payments systems and reported back on the user experience. And the user experience is the key: cash and credit cards are convenient as long as you have them with you, so a mobile solution would need a noticeable improvement to drive widespread adoption. Are any of the services out there now providing that experience? I decided I’ll have to try them out myself.
I plan to conduct this test on my Android phone (and my friend’s iPhone when necessary) covering two payment categories: p2p and mobile-for-real. For the p2p test, I will use each service to settle bills while going out with a group of friends and grade each based on:
- Ease of convincing my friends to use it
- Number of interactions necessary for transfer
- Transaction fee
- General user experience
The services I will test include PayPal Mobile, Obopay, and Dwolla.
For the mobile for real test, I plan on buying tangible goods and grade the services based on:
- Availability of merchants
- Transaction fee
- Ease of transaction (does the cashier get it?)
- General user experience.
I plan to test out Square’s Card Case, Dwolla, Tabbedout, and mFoundry’s Starbucks Mobile Card.
For each product, I will decide whether I would be willing to use it instead of cash. Because I’m kind of a payments geek and may be more apt than the average person to fall for payment novelty, my Comp Lit grad student friend (“What’s Square? A shape?”) will use each service too, and decide whether she would use them instead of cash or credit card. If I missed a service, you think there are other criteria I should include in my test, or you just want to talk about payments, let me know. I would love your feedback and questions. Check back for the test results at the beginning of next week!
