Consumers Are Using Mobile Payments Now More Than You Think
At the Money20/20 Conference held in Las Vegas in October 2015, eMarketer estimated that 23.2 million consumers will have used proximity mobile payments in the United States by the end of 2015, the number growing to 37.5 million by 2016 and the total value of mobile payment transactions growing from $8.7 billion in 2015 to $27 billion by 2016, a growth rate of 210%. There is no doubt that mobile payments is growing, but the latest June 2015 consumer data from Mercator Advisory Group suggests that perhaps twice as many U.S. consumers as eMarketer estimated have already tried using mobile payments at the point of sale. With more mobile payment options available, eMarketer suggests that 2016 will be a pivotal year for mobile payments growth. Consumers 25–34 year old are the age group most likely to use this technology. eMarketer estimated that 17.5% of 25–34 year olds have used mobile payments in 2015 and predicted that percentage that will grow to 29% in 2016 and 37% by 2017, while older adults, especially seniors, are more reluctant to pay by mobile phone, eMarketer estimating only 3.5% of adults age 65 and older have used mobile payments at the point-of-sale in 2015 and predicting only 6.3% will it by 2017.
The annual Payments survey in Mercator Advisory Group’s CustomerMonitor Survey Series, conducted in June 2015, finds that twice as many U.S. consumers actually used mobile payments than eMarketer estimated. The survey results, presented in the recent Mercator Insight Report, Mobile Payments Are Really Here!, find that 23% of smartphone owners surveyed reported using mobile payments in U.S. stores by tapping or waving their phone or by scanning a Quick Response (QR) code at U.S. merchant terminals; in comparison, eMarketer estimated that 12.7% had used mobile payments. While eMarketer estimated that the percentage of smartphone owners who will use mobile payments will rise every year from 2014, that estimate did not take into account the changing demographics of smartphone owners from 2014 to 2016 as the mobile payment technology matures and ownership broadens to include more older adults who currently are less likely to use proximity-based mobile payments.
Mercator’s June 2015 survey data does confirm that 25–34 year olds are the consumers most likely to be using mobile payments in U.S. stores today, as indicated by the fact that 40% of 25–34 year olds and 33% of 35–44 year olds said they had used mobile payments, but only 14% of 18–24 year olds, 15% of 35–64 year olds, and 3.5% of adults age 65 and older. When asked how often they use mobile payments in stores today, 50% of mobile payers indicated they used mobile payments in stores at least 4 times a month, or once a week, and 16% reported using it at least 10 times or more in the month preceding the survey. Apple Pay appears to have already jump-started the use of mobile payments in stores, as 80% of Apple Pay users indicated they had used Apple Pay in stores at least 4 times in the previous month, and 19% of Apple Pay users have used it at least 10 times or more in the previous month.
According to the latest U.S. Bureau of the Census data (from 2013), approximately 237 million U.S. adults reside in the United States. Our data indicates that 60% of adults owned a smartphone in 2014 and 43% of smartphone owners ever tried mobile payments (online or in stores), so approximately 61.1 million U.S. adults used mobile payments in 2014. By 2015, 72% of these U.S. adults own smartphones and 42% of them have used mobile payments. This means approximately 71.5 million U.S. adults may have used mobile payments, a growing method of payment. Our data indicates that while 23% of smartphone owners (39 million adults) used mobile payments in U.S. stores in 2015, and roughly half (19 million) use this payment method at least once a week.
For more information on consumer use of mobile payments consumer use of mobile devices for making payments and shopping online and in stores, related payment features including e-couponing, e-receipting, e-loyalty as well as payment, balance, and fraud alerts, experience with Apple Pay compared to payment cards, and ownership, purchase plans and important features of wearable technology for payments, please refer to Mercator Advisory Group’s CMSS Insight Report, Mobile Payments Are Really Here!, based on an online survey of 3,008 U.S. adults reflective of the U.S. Bureau of the Census demographic profile and accessible by CustomerMonitor Survey Series members.