The New York Times, in an article about the upcoming battle between Apple Pay and Android Pay:
Awareness of mobile payments has been stoked by Apple Pay, which Apple introduced last October. Apple has partnerships with dozens of American banks, allowing Apple Pay to work with most major credit cards. Some retailers, like Walgreens and Whole Foods, have said mobile wallet payments in their stores have grown significantly since the debut of Apple Pay.
But analysts have noted that a missing piece from Apple Pay was a rewards program to keep users returning to participating merchants. People familiar with Apple Pay said that next month, Apple will announce such a program offering perks to consumers who make purchases with the service, though they declined to reveal details.
Picking this apart, there is a difference between a program that rewards frequent use of Apple Pay and the ability of Apple Pay to keep track of and enable all of a user’s various rewards programs as they pay with Apple Pay.
In other words, if i am a member of the Taco Hut frequent buyers program, if I pay with Apple Pay, will I get credit towards my free taco? Or, if I pay for my goods at Staples, will my Staples rewards number make its way into the transaction if I pay with Apple Pay?
If Apple rewards me for frequently using Apple Pay, that’s great, but it does not fill in the “missing piece”. Here’s hoping Apple has found a way to solve the real rewards program problem.
“The challenge for Apple and Google, along with rivals, is that the mobile wallet is generally a technology in search of a problem.”
The problem with this statement is that people don’t understand that there is a problem, identity theft. The idea here is to create a more secure system than what we have. That’s the problem. Apple and Google see the problem, the problem is now educating people about that problem and why this is the solution.
You’re picking apart and already complaining about something that has not been announced yet. Have you become the person you used to mock?
Really great (and fair) comment. My intent was not to pick apart Apple Pay rewards. Instead, my target was the way the story was reported by the Times. Which is it? A missing piece, or something completely different? A true 3rd party rewards program integration into Apple Pay, or a simpler, frequent Apple Pay rewards program.
Hopefully, this clarifies my intent. And thanks for calling me on this. I am always striving to do better as a writer.
— Dave
It will probably be like what Square has now. Vendors will be able to keep track of your rewards when you use Apple pay. So instead of keeping a punch card in your wallet, Apple Pay will keep track of how many coffees you have bought.
Ok. I get your point. It just read like you were critiquing both.
Having said this, I think Apple can easily rewards program the way you’d like it, but it would not be unusual for them to decide not to do it out of principle (whatever that principle may be).
As someone that has had to update credit card numbers multiple times because of data breaches (Target and Home Depot), I’m as educated about the problem as I can be. I’m definitely looking forward to getting access to Apple Pay with my next iPhone purchase.
Speaking of which, I do think the next generation of hardware will even further expand their reach if Touch ID makes its way to the entry-level phones (whatever that may end up being; iPhone 5CS?). I wonder if they’ll sacrifice that distinguishing feature between models to help shore up their Apple Pay numbers. (it’d be short-term sacrifice for long-term gains, which is definitely how Apple plays the game)
I cannot imagine that a rewards program will come from Apple. Apple is not in the business of doing “loss leaders”, and with Apple supposedly getting around 0.15% of Apple Pay transactions, there is very little they could give that would incentivize consumers. Even if Apple gave up their entire profits, it would only be 15 cents on a $100 purchase which is not really going to excite anyone.
If there is a rewards program coming up, the only thing it could be would be a way for companies to tie in their rewards programs with Apple Pay. This is actually good for the stores (they can track their consumers), and good for consumers (they have the choice of being tracked in exchange for some sort of reward).
More importantly, it is probably a very big incentive for more stores to start accepting Apple Pay and making it mainstream. I love using Apple Pay, but I can still only use it for a small fraction of my purchases.