As expected, the battle around mobile wallets is intensifying, with announcements from mobile operators, financial services companies, media giants and more all eager to push the mobile and digital wallet. As I have written before, the biggest hindrance is the “so what” from the consumers. While the industry does back flips over how cool it is to tap your phone to pay, most consumers will likely see this as a very marginal improvement to whipping out your card (which now increasingly can be tapped).
But the incident at Zappos.com – and the promise of more of these to come with other retailers – may be that catalyst to spearhead the uptake much faster than saving time in public transportation queues or getting offers while you shop. 24 million accounts getting hacked is more than a serious number. While card numbers were not compromised, personally identifiable information was. And even though Zappos claims passwords – which a lot of people tend to re-use from one site to another – were encrypted, 24 million data points is pretty good input to any algorithm trying to break encryption codes.
A properly designed wallet, like Visa’s V.me will not only protect your credit card information, but also keep your address, phone number and shipping details secure. Tom Krazit at moconews makes another compelling argument about how painful it is to have your physical wallet stolen and that it made him rethink the usefulness of a mobile wallet. Krazit’s arguments are indeed spot on, but with ever increasing online commerce and mcommerce, identity theft is likely to be a lot more serious and painful than losing your physical wallet.
Still to be answered is what will compel users’ choice on which wallet to go for. While a physical wallet certainly is choice of style, fashion and capacity, the choice of digital wallet is likely to be far more complex. Once you get past the basics of storing your credit, debit and loyalty cards, what is it that will convince users to sign up for a specific digital wallet? While certainly the industry is trying to crack the carrot end of the stick by adding offers and all sorts of add-on services to the wallet, the stick of fear is likely to have a far better impact in propelling the digital and mobile wallet.
Disclaimer: The views expressed on this post are mine and do not reflect the views of any clients or companies I am currently working for or have worked for.
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