Three Ways Walmart App Features Can Combat the Draw of Apple Pay at the Point of Sale
July 18, 2018
(New York, NY): Walmart shoppers who can use Apple Pay and have a mobile payment preference are twice as likely to choose Apple Pay over Walmart Pay, according to new research from Auriemma Consulting Group’s Mobile Pay Tracker. But discount- and shopping-focused app features could give Walmart and other merchants a competitive edge over Apple Pay, according to Auriemma’s study, which examined Walmart, Target, and Kohl’s shoppers’ use of merchant apps and mobile payments. The study also revealed how merchants can migrate more customers to proprietary mobile payment options embedded in commerce apps— and that there is a compelling reason to do so. Walmart Pay shoppers spent an average of $319 in the past month with the merchant compared to $291 for Apple Pay users, both representing a significantly higher spend than shoppers who have never used the Walmart app.
Here are three ways merchants can leverage app features to increase engagement and differentiate their mobile payment offering from Apple Pay.
Emphasize features that offer savings or promotions. Shoppers want deals at their fingertips. Walmart customers who don’t have the Walmart app installed would be most interested in using the app to find coupons, view sales, exclusive offers, and rewards, and/or to use the Savings Catcher feature. These features are also the most used by those who have the app, highlighting their importance in both promoting app adoption and habitual usage. Leading with these value-enhancing benefits can not only boost adoption, but also drive increased satisfaction with the app as a whole. Ultimately, shoppers come to the Walmart app to save money at the point-of-sale, but highlighting mobile payment functionality will create a captivating experience that competitors like Apple Pay cannot currently match.
“Satisfaction with a merchant’s app is an indicator of wider mobile payment adoption,” says Jaclyn Holmes, Director of Auriemma’s Payment Insights practice. “A seamless merchant app/payment experience that leverages the features shoppers love, such as coupons or rewards, could be the tipping point needed to get them excited about downloading and using a merchant’s app and payment functionality over the competition.”
Focus on features that elevate the shopping experience for customers. For merchants to increase their app and mobile payment usage, customers will need to feel that it adds something extra to the shopping experience. While it’s unsurprising that customers without the Walmart app would be interested in using it to shop for items, it is notable that a near equal proportion reported that they would want to check an order status or scan item barcodes for information in-store using the app.
“Features that keep shoppers engaged with Merchant apps during the real-time shopping experience are important in the transition from shopping to purchasing,” says Holmes. “While discounts and promos may get shoppers to open the app, finding ways to engage shoppers for the duration of their shopping experience will help form new habits that ultimately lead to Merchant Pay usage, particularly in-store.”
Create a sticky shopping experience that smoothly transitions to checkout. In general, mobile payment users tend to find the experience easy, fast, and convenient, regardless of whether they are using Walmart Pay, Apple Pay, or a similar digital wallet. The former, however, has an opportunity that Apple Pay does not. By featuring all the ways the Walmart app enriches the overall shopping experience (including payment functionality), Walmart, and other merchant apps/payments, can set themselves apart from device-centric wallets, whose main draw is specific to the payment experience and not the shopping experience as a whole.
“The desire for a universally accepted wallet poses a threat to single-merchant wallets,” says Holmes. “Finding opportunities to drive value, customize the shopping experience, and positively influence each aspect of the customer journey—from discovering new items and deals, to reserving items, to applying coupons and building loyalty through rewards—is a key differentiator.”
This study was conducted online within the US by an independent field service provider on behalf of Auriemma Consulting Group (Auriemma) in April-May 2018, among 921 US adults who made a purchase from Walmart, Target, or Kohl’s within the past 6 months. All respondents were also screened to have a general purpose credit, debit, or store card, own a smartphone, and have made a purchase on their phone. Each shopper was classified as an ‘App User’ or ‘App Non-User.’ All shoppers were also classified as a ‘Pay User’ if they have ever used the Merchant Pay functionality (Walmart Pay, Target Wallet, Kohl’s Pay) on the merchant app. A minimum of n=150 Merchant App Users, n=150 Merchant App-Non-Users, and n=50 Pay Users were recruited to take the survey.
About Auriemma Consulting Group
For more than 30 years, Auriemma’s mission has been to empower clients with authoritative data and actionable insights. Our team comprises recognized experts in four primary areas: operational effectiveness, consumer research, co-brand partnerships, and corporate finance. Our business intelligence and advisory services give clients access to the data, expertise and tools they need to navigate an increasingly complex environment and maximize their performance. Auriemma serves the consumer financial services ecosystem from our offices in New York City and London. For more information, visit us at www.acg.net or call Jaclyn Holmes at (212) 323-7000.