Mobile Wallets & The Monetization Effect

By Amy Vale

The term ‘mobile wallet’ has been popping up quite frequently in major discussions among industry experts, analysts, retailers and the press. A mobile wallet is a smartphone or tablet app that stores a consumer’s payment details on his/ her devices or online to fund digital and in-store purchases. These mobile wallets are being touted as an area of great promise to both streamline and speed up the overall shopping process for consumers. According to a recent report by JuniperResearch, mobile payments are expected to rise nearly fourfold to more than $1.3 trillion annually by 2017.

Since the Merchant Customer Exchange announced its plans to launch a mobile payments network back in August, two more leading retailers have joined including Gap Inc. and Bed Bath & Beyond Inc.  It’s not just retailers who are lining up to implement mobile wallets into their larger advertising strategies. Financial services giant MasterCard is putting a lot of its marketing and manpower behind its vision to let consumers pay for items from just about any app or video. But the question remains: How will app developers monetize with mobile wallets? Here are 3 things app developers should keep front of mind when developing mobile wallet apps.

Improve user experience (one-click payment option from mobile devices)

When it comes to today’s shoppers, multi-tasking is embedded into their DNA. They are typically on-the-go, running from one place to the next and rely on smartphones and tablets (often simultaneously for varying tasks). One key tactic that will help app developers monetize with mobile wallets is improving the user experience. Create a user experience that makes it easy, fast and even entertaining to get from point A (researching a product) to making the final purchase in as few clicks as possible.

Offer instant mobile coupons

The beauty of a mobile wallet is that it simplifies and enhances the overall shopping experience, all within a mobile app. Using location-based targeting to deliver instant coupons is a smart and effective way for app developers to monetize with mobile wallets.

Look at customer purchase data and tweak advertising tactics accordingly

As with any form of marketing, data shouldn’t just be seen with the attitude of “what did we do?” App developers looking to generate revenue via mobile wallets should look at data with the attitude of “how can I act on it?” As more mobile wallets enter the market, the amount of purchase data from an increasingly mobile audience will be tremendous. Ask yourself important questions. Who are the consumers using your mobile wallet? What is their purchase behavior? How often are they shopping? What’s their typical spend per purchase? If your app isn’t perfoming well (less than 3.5 stars), use the data to tweak and adjust your app so that it’s creating a consistent stream of revenue.