The mobile payment space is starting to really heat up. As the percentage of smart phones increases among the total population of cell phones, more vendors are experimenting with allowing customers to pay with their phone. Square has been an early and big innovator in the field, starting with their iPhone/Ipad add-on that allows small businesses to swipe credit cards right on the device. Now Square is moving into the next generation of payments with their Pay by Square app that does not require the square device.
PayPal is the grandfather of online payments and is trying to stay relevant as well. They already have capability with Home Depot, allowing customers to pay via PayPal when checking out. Now comes word they are working with McDonalds on mobile payments via a cell phone. But with this app, it’s not just payment. McDonalds allows you to place your entire order, pay, and then pickup from a separate window. This is end to end service via cell phone and you don’t have to try to interpret what the order taking is saying on the other end of a scratchy speaker.
Think now about the localization possibilities of such an app. You are driving near a McDonalds and it’s getting close to noon. The app could pop a discount and suggest lunch at McDonalds, even firing up your gps on the phone to route you to the location. Since you have ordered before, the app knows your favorites and could pre-populate an order.
You see, this goes beyond just mobile payments. It’s about the entire business ecosystem gone mobile. You have a todo on your phone that you need to get to the hardware store. Again, driving around, you come within two miles of a Home Depot and the app lets you know you are close and that you had that todo. I am always putting things on a todo list and them not remembering them. I would love such a feature, especially if it came with coupons and discounts. Your business always needs to be where the customers are, and increasingly they are mobile and with smart phones.
The other two big players to watch are Google and Apple. Both are competing with digital wallet apps. Right now it’s more about loyalty card storage and use, but if the big boys of payment Visa and Mastercard get involved, they could eat everybody else’s lunch.
What is clear are two things. Business is going mobile in a big way and millions of people will be ordering and paying for goods and services with their smart phones in just a few years.