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P2P Payments Used for More Than Check Splitting

(New York, NY): Person-to-person (P2P) payments are increasing in popularity and diversifying in use, with nearly one-third of consumers currently utilizing the service, according to recent research by Auriemma Group. The firm’s latest Cardbeat® surveys, among 800 US credit cardholders, found that users report several practical uses for P2P payments other than just splitting the check—many citing transaction speed and ease of use as reasons for the preference.

Users agree that P2P payment apps make it easier to pay people far away (94% agree), to keep track of money owed to friends and family (81%), and to split checks or bills (80%). “It isn’t just used to pay for your share at dinner anymore,” says Jaclyn Holmes, the Auriemma senior manager who directed the studies. “The ease of paying people far away suggests users may utilize P2P payments as an alternative to sending checks, money transfers, or providing account information to pay for goods or services.” P2P users also seem to enjoy flexibility in how they pay, with nearly one-half of users linking multiple accounts to a P2P app. Most users link credit rather than debit cards to their P2P apps, consistent with consumers’ preference for using credit cards for online purchases.

Among all respondents, familiarity was highest with PayPal Me (27%), Square Cash (17%), and Facebook (14%). While Venmo was the fourth most familiar among cardholders overall (12%), more than a quarter of Millennials (26%) cited familiarity with the brand. Those familiar with a P2P payment app commonly cite online advertising, word of mouth, and social media as how they first heard of the payment platform. “From a marketing standpoint, the very nature of P2P is that it encourages you to promote it to your friends,” said Marianne Berry, Managing Director of Auriemma’s Payment Insights team. “Users, by necessity, often bring other new users with them: more than two-thirds of users under age 35 reported that they’ve encouraged friends to sign up for a specific P2P app.”

These findings are consistent with a recent issue of Auriemma’s The Payments Report, a survey of 500 debit cardholders, which revealed that 85% of those who used at least one P2P payment app/service were at least somewhat likely to recommend the app/service to a friend. The study also found that 38% of the same population have used the service to pay someone other than a friend, suggesting that P2P payments are not simply just for splitting the bill at dinner, but may prove a more useful form of payment for those who prefer the method over cash or checks.

Survey Methodology
The studies were conducted online within the United States by an independent field service provider on behalf of Auriemma Consulting Group in September and November 2015, among 800 credit card users each (“cardholders”). The number of interviews completed on a monthly basis is sufficient to allow for statistical significance testing between sub-groups at the 95% confidence level ± 5%, unless otherwise noted.

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines.

Complementary to our core consulting business, Auriemma facilitates a series of Industry Roundtable groups focused on a variety of industries in which clients exchange information through activities managed by Auriemma, comparing and analyzing industry practices and benchmarks so that each member can optimize its own performance.

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Paying by Plastic Changes Tipping Behavior

(New York, NY): Tipping for service may be a cultural norm in the US, but prompts at point of sale can greatly affect who gets tipped and how much, according to new report by Auriemma Group. The firm’s latest Cardbeat ® survey of 800 US credit cardholders found that presenting consumers with the opportunity to add a tip when they pay by credit card can increase tipping behavior by almost a third.

When queried about their normal habits, the vast majority of consumers (93%) say they typically tip their servers in a restaurant, while 72% tip for food delivery and 69% tip their hair dresser or barber. Tips are far less prevalent when given in cash, however, with fewer than half of those surveyed saying they generally tip taxi drivers (46%), valet parking attendants (38%), or hotel room cleaners (39%). Asked what they’d do if they didn’t have cash handy, 41% of consumers say they’d skip leaving a gratuity altogether for courtesy services where they may otherwise tip. Given the option, nearly 9 in 10 (89%) cardholders say they would always tip on a card if they could, with 79% adding that they feel it’s an inconvenience when they’re unable to tip on their credit card.

As payment card acceptance becomes more widespread, however, so does the likelihood of tipping. A noteworthy 30% of cardholders say that tip suggestions that appear at point of sale make them more likely to tip. “These tip prompts are often used on mobile point of sale (mPOS) systems, such as those used by car services or taxis” said Jaclyn Holmes, the Auriemma senior manager who directed the study. “When the checkout screen asks if they want to tip 15%, 20%, or 25%, people are far more likely to leave any tip, although most opt for the lowest suggested amount.” At fast casual restaurants 81% of cardholders would leave a tip after passive merchant prompting through an mPOS system, representing a 31% increase in the number of cardholders who would leave a tip at a restaurant of that kind. “On a cumulative basis, such prompting could create a significant increase in payment card transaction volume,” Holmes noted. “Baristas and drivers may welcome these innovations, but so will the IRS, which can more easily document these sources of income.”

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. For more information, please visit Jaclyn Holmes at 212-323-7000.

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Fewer than Half of US Cardholders Have Received a Chip Card and Many Don’t Know How to Use It

(New York, NY):   With just under a month until the US EMV liability shift takes effect, less than half of US credit card holders have received a chip card from their issuer, and many of them have never used it as intended, according to recent Cardbeat® research conducted by Auriemma Group. In a June survey of 400 US adult credit cardholders, nearly half (47%) of respondents report having received at least one EMV credit card, and one-quarter hold an EMV debit card. While EMV card conversion will likely continue into 2016, issuer migration efforts so far appear to far exceed those of merchants – recent projections estimate merchant terminal enablement could be as low as 25% through October. Though few merchants have transitioned to EMV terminals, customers are already perceiving a less efficient checkout experience at the point of sale.

The Cardbeat data show that nearly half of EMV cardholders (47%) have not inserted their chip card into a terminal, and among these individuals, nearly eight in ten (78%) have never encountered a chip-enabled terminal. “Even though many issuers are providing their cardholders chip cards and general communications about them, this information will be forgotten if cardholders aren’t able to form the new habit of using their card with a chip reader until months later,” says Jaclyn Holmes, Senior Manager of Auriemma’s Payment Insights. “While most respondents said that the communications they received with their new EMV cards was clear, we found considerable misinformation among consumers. The majority of respondents believe that chip cards are inherently more secure – even when used at a conventional terminal – and that they should just continue to swipe their card.”

The Cardbeat research shows that cardholders typically understand that EMV cards are more secure – 67% correctly know it’s more difficult for unauthorized users to counterfeit a chip card than a standard magnetic stripe card, 58% understand the chip encrypts personal information into a unique code, and 55% know dipping a chip card is more secure than swiping a magnetic stripe card.  On the other hand, chip card functionality and usage in merchant-enabled EMV terminals is less understood. More than two in five cardholders (44%) incorrectly believe swiping a chip card is more secure than swiping a magnetic stripe card, and a similar proportion (39%) were unsure. Furthermore, over half (52%) of those currently holding a chip card said they would prefer to swipe their chip card, even if a retailer has chip-enabled terminals. “Cardholders do not have a good understanding that in order to benefit from the increased security chip cards offer, the chip must be inserted into the reader – nor do they seem to understand that once merchant-enabled terminals are turned on, they may not have a choice,” Holmes noted.

So far, research shows that the customer experience resulting from the EMV migration has been less than satisfactory – over one-third (35%) of EMV cardholders who have tried to use their chip card in an enabled terminal say they have encountered difficulties. A similar proportion of all respondents (37%) have encountered checkout delays because another shopper had difficulties. Nearly half of cardholders (48%) said that EMV transactions take noticeably longer than magnetic stripe transactions to complete, attributable to the requirement to leave the card in the reader throughout the transaction. Merchants shouldn’t be surprised if a large number of cardholders remove their cards too quickly from the readers – 64% of cardholders are unaware that they must keep their card in the reader until the transaction is completed, otherwise the transaction will be terminated. “Due to the gap in merchant deployment, education in chip cards will have to be ongoing, and merchants will need to match the efforts of issuers. With the holiday shopping season right around the corner, this is the opportune time to iron out the problems,” Holmes said, “because customer resistance during the high shopping season could make for a lot of unnecessarily angry customers.”

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space.  We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. For more information about Auriemma’s Payment Insights, please call 212-323-7000.

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Apple Pay Adoption: Growing or Slowing?

By Rene Ritchie, iMore.com

Thursday, Aug. 6, 2015

The tale of two Apple Pay surveys.

There have been some conflicting surveys out about Apple Pay in the last couple of weeks, one of which says the mobile payment service is growing and the other, declining. So, which is it?

The Auriemma survey is clear and up front about where the data comes from, is easy to read, and comes off as professional and, well, sane:

Apple Pay usage in the US is growing, driven by both increased frequency of transactions and the expanding base of iPhone 6 owners, according to Auriemma Consulting Group’s Apple Pay Tracker, which interviewed 500 iPhone 6 and 6+ owners between May 29 and June 15, 2015. Forty-two per cent of Apple 6/6+ owners reported having used Apple Pay, virtually identical to the proportions reported in two previous waves of the study conducted in February and April 2015. “While the proportion of users has remained stable, the denominator has grown through new iPhone and Apple Watch sales and the upgrade cycle. We’ve also seen the average number of transactions increase both in-store and in-app,” says Marianne Berry, Managing Director of ACG’s Payment Insights practice.

They go on to say Apple Pay is considered to be move than a novelty, is growing at points of purchase, and that there appears to be lots of room for further growth.

The PYMNTS/InfoSocut is the opposite. It’s almost impenetrable, written as half-narrative about a conference, doesn’t clearly say where the data comes from, and is filled with comments from people who appear to have competing interests to Apple Pay—including the CEO’s of Paypal owned Paydient and Samsung-owned LoopPay. Which is, frankly, bizarre.

In March, survey data indicated that 15.1 percent of eligible Apple Pay users had tried the service – when surveyed in June 2015 that had fallen to 13.1 percent.

Usage fell as well – when asked in March, “Did you use Apple Pay on this transaction,” 39.3 percent of consumers said yes. When asked the same question in June, only 23 percent replied in the affirmative.

They go on to say Apple Pay has dipped with committed users and that Apple Pay doesn’t sell phones. Then they go into the appalling quotes from competitors.

iMore hasn’t looked into Apple Pay usage among iPhone owners yet, but we did ask Apple Watch owners as part of our ongoing survey. We’re only a quarter of the way through the data collection phase right now, but with thousands and thousands of responses in already, the numbers are currently as follows: 60% have used Apple Pay at least occasionally, and over 30% use it whenever it’s available to them.

That’s for a service that, until very recently, was only available in the U.S., is still only available in the U.S. and U.K., is still adding banks and retailers, and won’t be launching support for loyalty and store cards until iOS 9, later this fall.

Still, we’ve seen how Apple Pay accessibility can empower people:

That Apple Pay on the iPhones 6 (and [the] Apple Watch) works so effortlessly that it instills feelings of empowerment and independence for users with disabilities is profound.

How Apple Pay is automagically secure, which literally turns what previously was an extremely stressful experience into a delightful one:

The first time you experience this seamless transfer of your accounts with Apple Pay, you’re going to want it everywhere you purchase goods and services. That, combined with very positive word-of-mouth, is going to make entering a card number feel very antiquated. And I suspect this change will come about very quickly.

And how great Apple Pay is to use on the London Underground:

Apple Pay is a great way to get around London. Keep your wallet safely tucked away in your bag or pocket and better keep track of your transactions. I managed to visit London for two full days without using the debit card connected to my Apple Pay

Without more data, it’s impossible to tell with an absolute certainty which set of numbers most accurately present the current state of Apple Pay growth. It’s pretty easy, however, to judge the companies presenting the data. AGC is clean, clear, and professional. PYMNTS/InfoSocut rings just about every integrity alarm bell imaginable.

Negative Apple headlines drive a lot of attention, though, so it’s no surprise the negative numbers are getting a lot of pickup. Still, it’s better to look at both sets, and both companies, and match what they say against your own experiences, and then decide for yourself.

For me, I’ll be using Apple Pay as much as possible as soon as possible.

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Apple Pay Use Growing in US

(New York): Apple Pay usage in the US is growing, driven by both increased frequency of transactions and the expanding base of iPhone 6 owners, according to Auriemma Group’s Apple Pay Tracker, which interviewed 500 iPhone 6 and 6+ owners between May 29 and June 15, 2015. Forty-two per cent of Apple 6/6+ owners reported having used Apple Pay, virtually identical to the proportions reported in two previous waves of the study conducted in February and April 2015. “While the proportion of users has remained stable, the denominator has grown through new iPhone and Apple Watch sales and the upgrade cycle. We’ve also seen the average number of transactions increase both in-store and in-app,” says Marianne Berry, Managing Director of Auriemma’s Payment Insights practice.

Data from the study indicates that users consider Apple Pay to be more than a novelty, Berry notes. “It’s not surprising that the first cohort to own the newest iPhone would be eager to try Apple Pay, so we were particularly interested in comparing trial to adoption rates. Eighty-four percent of Apple Pay users reported having made more than three transactions in stores, and 76% have used it more than three times in-app, suggesting that the abandon rate is low.”

The number of places where Apple Pay is used has also increased. In the April survey only 13% of Apple Pay users had used it in more than six stores, while two months later that number had grown to 24%. During the same two month period the number using Apple Pay for 6 or more apps grew from 1% to 10%.

“It’s likely that the number of retailers accepting Apple Pay will expand, especially as merchants hear from these customers and look at their purchasing power. Seventy per cent of Apple Pay users state that they are more likely to choose a store that accepts Apple Pay,” Berry says, “and this group is even more affluent than the overall Apple phone owner population.”

Indeed, one of the few complaints users have is a lack of opportunities to use Apple Pay. The effect is particularly notable in the burgeoning m-commerce market, as Apple Pay devotees have learned to search the App Store to find apps that accept the payment method. “It’s a rare instance of consumers starting out with a preferred payment method and searching for a place to spend it—like the proverbial hammer looking for a nail.”

Despite the enthusiasm of early adopters, Apple Pay sales volume accounts for only a tiny share of overall credit and debit card sales, and Berry doesn’t expect that to change quickly. “In the early days after launch, we found a high level of intent to use among those who hadn’t tried it yet. As more iPhone owners gain the ability to use the service through the upgrade cycle, we’re seeing a pretty stable proportion of about 30% who are taking a ‘wait-and-see’ attitude, often citing security concerns about a new technology. The introduction of Android Pay later this year may accelerate the evolution of perceptions about mobile payments moving from novelty to mainstream.”

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. For more information, call (212) 323-7000.

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Young Consumers More Likely to Spend Gas Savings

(New York, NY): Most consumers have more money in their pockets thanks to lower gas prices, but younger people are more likely to spend their savings, according to research from Cardbeat®, Auriemma Group’s syndicated research publication. In a survey of 421 U.S. credit cardholders, one-third (34%) of consumers under age 45 say they’re now considering making previously postponed purchases, compared to just 20% among their older counterparts.

Many consumers’ personal finances are buoyed by lower oil prices. Close to two-thirds (62%) of drivers say they’re spending less on gas than they were a year ago, and 88% cite the lower cost of gas compared to a year ago. Yet caution permeates consumer behavior and varies considerably by age group. Consumers aged 45 and older, who remember rising gas prices during the OPEC oil embargo and Gulf War years, are more likely to see low fuel prices as a temporary phenomenon. Cardbeat data shows individuals aged 45 and older are more pessimistic in their outlook for the price of fuel going into the future, with 69% feeling the price of gas will go up in the next year, as opposed to 59% among respondents under age 45.

Major card payments networks validate that the impact of lower gas prices on card spending has been modest so far. For example, in January 2015, MasterCard CEO Ajay Banga told investors in the company’s quarterly earnings call, “We haven’t [yet] seen the extra savings from lower gas prices translate into additional discretionary consumer spending.”

The consensus among many economists is that we could start witnessing more discretionary credit card spending this summer (barring any unforeseen increases in gas prices). Marianne Berry, Managing Director of the Payment Insights practice at Auriemma, says that merchants would still be wise to presume a cautious consumer would be the rule for the foreseeable future, and target their promotions to the younger consumers who would most likely be receptive to such offers.

She adds that certain merchant categories, most notably restaurants, are likely to be the first beneficiaries of any incremental spending. “Consumers anticipate their highest increases in spending will be on food and dining over the next year” said Ms. Berry. ”After restaurants, retail in general, particularly fashion and electronics, are likely beneficiaries of discretionary spend among Millennials and Gen Xers.”

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. For more information about Auriemma’s research, please call 212-323-7000.

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Apple Pay Use in US Steadily Increasing Beyond Early Adopters

(New York, NY): The use of mobile payments is continuing to grow and broaden, as nearly half (46%) of iPhone 6 owners have successfully used Apple Pay, up from 42% just two months ago. The latest wave of Auriemma Group’s bi-monthly Apple Pay Tracker, which interviews a fresh sample of 500 iPhone 6 owners every 8 weeks, also finds high levels of repeat usage, with 63% reporting that they use Apple Pay at least weekly.

“The Apple Pay base is broadening from the tech-savvy early adopters,” says Marianne Berry, Managing Director of Auriemma’s Payment Insights practice. In Wave 1 (conducted between January 26 – February 6, 2015), 70% of Apple Pay users identified themselves as people who “like to be the first to have the newest model phone.”  In Wave 2, conducted April 10-20, that figure had dropped to 55%, indicating that less tech-oriented types are now trialing mobile payments via Apple Pay.

Consistent with the finding that the newer users might be less technologically adept, a significant number are reporting problems in set-up.  The April survey found that 45% of respondents reported having issues setting up Apple Pay. “Among those who reported issues setting up Apple Pay, 62% acquired their iPhone in 2015, compared to 38% who got their iPhone in 2014,” Berry noted.

Despite these issues, user satisfaction is very high, and their main complaint is the lack of retail venues accepting Apple Pay.  67% of those that have used Apple Pay in a brick and mortar store say they are migrating to merchants that accept Apple Pay. And 51% say that they are using other payment methods, such as cash, less often since they began using Apple Pay.

“Mobile payments still comprise only a small fraction of overall payments volume,” said Berry, “but Apple Pay is the first service to garner double-digit numbers of users. As the upgrade cycle gives more consumers access to Apple Pay, and Android Pay comes to market, the long-awaited transformation of the payments industry may finally have begun. It will be interesting to see how US adoption patterns compare to those in the UK and in Canada—markets with higher penetration of NFC and contactless cards—when Apple Pay is rolled out there.”

Auriemma’s Apple Pay Tracker conducts an online survey of 500 randomly selected iPhone 6/6+ owners every 8 weeks, accompanied by qualitative telephone interviews; the full study is available through an annual subscription. Data reported above comes from interviews conducted April 10 -20, 2015.

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines.

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Clearer Issuer Communications Help Consumer Satisfaction With Credit Cards Reach 4-Year High

(London): Consumer satisfaction with credit cards has seen a steady increase since 2012, suggesting that the investments issuers have made in communicating the value and benefits of credit cards are paying off, according to Auriemma Group’s UK Cardbeat.® This syndicated online research publication was conducted in February 2015 among 442 UK cardholders. While the industry scored better for each of the factors measured, the improved satisfaction is mostly attributed to higher levels of trust in protecting information, and clarity surrounding credit card terms, signifying that recent efforts by banks have not gone unnoticed.

The Auriemma Industry Satisfaction Index (ISI) is a trended measurement of consumer satisfaction with credit cards, and has seen a stable rise over the past 4 years (69.6 in 2015 vs. 61.6 in 2012). While the industry posted an increase in each of the factors measured, the largest gains were among “I trust credit card companies to protect my personal information” (averaging 6.8 vs. 5.9 in 2012) and “Rules, terms and conditions are easy to understand” (5.6 vs. 4.4 in 2012). While this higher rating demonstrates progress, there is still substantial room for further improvement in transparency by banks, which the Financial Conduct Authority (FCA) has prioritised since early 2014.[1] The organisation identified areas they believe are not working in the best interest of some consumers, and hope to build a detailed picture of the credit card market to identify which actions should be taken.

“Improving consumer education through easily-understood marketing has been a priority in the industry for quite some time, and it’s encouraging to see consumers are recognising the efforts that have been made,” say Marianne Berry, Managing Director of the Payment Insights practice at Auriemma. “Even before the FCA’s most recent push, banks were already headed in the right direction.”

The research shows additional signs of improved consumer knowledge, specifically regarding APRs. In 2012, less than one-quarter (22%) were able to indicate the interest rate on the outstanding balances on their most frequently used credit card. Over the past four years awareness has steadily risen, and the proportion has doubled to nearly half (45%). Among revolvers, the group most impacted by APRs, awareness is even higher, with 6 in 10 able to specify their interest rate.

Following a similar line of inquiry to the work the FCA is doing, Auriemma’s upcoming issue of UK Cardbeat® will focus on opportunities for consumer education and improvement. “Providing notification is no longer enough; we need to ask cardholders what aspects of financial education they want more of. Efforts tend to be unsuccessful without a thorough understanding of what the consumer hopes to learn, and by what means we can successfully deliver this information. Our forthcoming research aims to unveil just that” says Berry.

Survey Methodology

The study was conducted online within the United Kingdom by an independent field service provider on behalf of Auriemma Consulting Group in February 2015 among 442 credit card users (“cardholders”). The number of interviews completed on a monthly basis is sufficient to allow for statistical significance testing between sub-groups at the 95% confidence level ± 5%, unless otherwise noted.

 About Auriemma Group

Auriemma is a boutique management consulting firm with specialised focus on the Payments and Lending space. We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines.

[1] http://www.fca.org.uk/news/credit-card-market-study

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Card Fraud Hits 1 in 4 Consumers, but Most Are Satisfied by Bank Response

(New York, NY):  Over one-quarter (26%) of US consumers report having experienced credit and/or debit card fraud in a newly released study conducted in Cardbeat,® Auriemma Group’s syndicated research publication. Among fraud victims, one in five (20%) said that their fraud experience was directly linked to a data breach that became public knowledge.  Most consumers discover fraudulent transactions while reviewing their monthly statements, and erroneous retail charges are the most common type of fraud experienced, cited by 80% of those who report experience with card fraud.

Despite the rising incidence of fraud on payment cards, few consumers state that the experience has affected their willingness to use their debit or credit cards, a response that can be attributed their banks’ responsiveness. Three-quarters of consumers who reported having experienced payment card fraud stated that they were “very satisfied” with their bank’s response, and another 20% were “somewhat satisfied.”  Most (76%) consumers who experience card fraud were issued a brand new card with a different account number, and 65% say their account was credited for the disputed charges.

“For the most part, consumers seem to tolerate the fact that fraud is a potential risk of using payment cards, and most are appreciative of card issuers’ willingness to protect them from major security issues.  For example, 72% of all consumers who have experienced an unplanned card reissue say that their perception of their financial institution was positively influenced by the issuer response,” noted Marianne Berry, Managing Director of the Payment Insights practice. “However, the rising incidence of data breaches means that mass reissuance of cards is becoming more frequent, and some consumers have had their cards replaced multiple times in a short time frame.”  She noted that while overall satisfaction is high among those who receive new cards after a fraud incident, one-fifth (19%) of respondents report that they’ve received new credit cards due to fraud twice or more in the recent past, and their perceptions tend to decline with each subsequent reissue.

Ms. Berry says that banks still have opportunities to improve already-positive consumer perceptions.  She says “Involving marketing people in the correspondence may be an opportunity to improve the process for all parties involved.”  She noted that if the letter accompanying a new payment card is clearer about the reason a new card is being sent, consumers may be more likely to view the decision positively, regardless of how many times they’ve had cards reissued, adding that “providing consumers with a checklist of their recurring payment arrangements can also help reduce the hassles associated with switching card numbers.”

About Auriemma Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space.  We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines. For more information about Auriemma’s research, please call 212-323-7000.

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Auriemma Launches Apple Pay Consumer Adoption Study

(New York, NY):  Auriemma Group announced Thursday the launch of Apple Pay Tracker, a longitudinal study that will monitor adoption and usage of the mobile wallet throughout 2015.

The study, comprising bimonthly surveys of 3,000 iPhone 6 and 6 Plus users over the course of the year, will illuminate Apple Pay’s impact on payment providers, retailers, and other industry stakeholders.

“Apple Pay may change where people shop, how they pay, and the overall balance sheet of the payments system,” said Marianne Berry, Managing Director of Auriemma’s Payment Insights practice. “Issuers, merchants, networks, investors—all need to monitor these changes and have the flexibility to respond immediately to challenges.”

Every eight weeks throughout 2015, subscribers will receive a report tracing current levels of Apple Pay activation and usage by a randomized sample of 500 iPhone 6 owners. In addition to measuring growth in the adoption curve, subscriber reports will include information gleaned from in-depth interviews with respondents detailing their reasons for adopting—or bypassing—the service. Each iteration of the research will examine a unique subset of users, ranging from early to mainstream adopters as the market matures. Interviews with respondents will explore:

  • Motivations for usage
  • Changes to behavior and purchasing habits
  • Impacts on the customer relationship and brand attribution
  • The role of social influences in adoption and usage
  • Perceived security benefits and concerns
  • User experience and likelihood to recommend Apple Pay to other

“There is intense interest in both the industry and mainstream media about Apple Pay,” Berry said. “While transaction volumes and other aggregate data will be widely reported, these statistics won’t explain the behavior driving the numbers.“For example, how much growth in transaction volume is being driven by regular users and how much is attributable to growth in iPhone 6 sales? Are consumers changing their choice of retailers depending on the availability of Apple Pay? Do consumers make a conscious choice at point of sale among the cards provisioned in their Passbook, or does the default card become the most frequently used?”

Apple Pay Tracker joins a suite of market intelligence and syndicated research studies offered by Auriemma’s Payment Insights practice. In addition to mobile payments, Auriemma conducts consumer research focused on credit, debit, and prepaid products.

“Whether or not Apple Pay reaches broad acceptance,” Berry said, “millions of consumers will pay with their phones for the first time. This may be the long-awaited catalyst that ignites mobile payments.”

 About Auriemma Consulting Group

Auriemma is a boutique management consulting firm with specialized focus on the Payments and Lending space.  We deliver actionable solutions and insights that add value to our clients’ business activities across a broad set of industry topics and disciplines.  For more information about Auriemma’s research, please call 212-323-7000.

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