Visa claims contactless acceptance at 'tipping point'
Visa has claimed contactless payment acceptance has reached “tipping point” and is preparing to launch a multi-million pound pan-European push to showcase its range of contactless, mobile and ecommerce payment options.
A television advertisement breaks this week in 19 countries and aims to highlight the ease and convenience of new payment technologies. It shows an old man’s journey to visit his new-born grandchild being made easier by using Visa’s services.
Mariano Dima, chief marketing officer at Visa Europe, told Marketing Week the campaign is an attempt to make contactless “meaningful for consumers” by demonstrating how it can make life easier.
Visa has been at the forefront of industry efforts to increase acceptance and take-up of contactless. It has struck deals with major retailers including Marks & Spencer and Starbucks to carry its terminals and forged m-commerce partnerships with mobile operators such as Vodafone.
Despite its efforts, it has been suggested that consumers’ concerns over security are holding back progress, with particular reluctance to make mobile payments using NFC technology.
Dima dismisses the suggestion, adding contactless has reached “tipping point” in the UK and that critics are ignoring the “real facts”. Visa payments using contactless technology numbered 5 million in the UK in March, up from 1 million in July 2012, he claims.
“We need to keep training, keep educating but consumers are using”, he adds.
Visa’s sponsorship of the London 2012 Games helped increase its brand value to $56bn in 2012, lifting it into the global top 10, according to the latest Brandz list.
The campaign comes as a British Retail Consortium report shows use of “alternative payment methods” such as contactless and Paypal more than doubled year on year in 2012 and now account for almost 5 per cent of all transactions.
Increased use could have come at the expense of credit and charge card use, down 3.4 per cent as a percentage of transactions. Debit card transactions, however, increased 3.2 per cent, the report says.
The decline in the use of cash continued with customers spending 10 per cent less using cash than in 2011. Although cash was still used in more than half (54.4 per cent) of all transactions, this was a drop of 6.7 percentage points on 2011.
Tesco’s “enterprise consultant architect” Lyndon Lee was reported to have recently opined that NFC is passed its “sell by date”, had no value to retailers and isn’t attractive to young people. Similar slights against other contactless services have been uttered.
With this background noise, it is necessary for Visa to shout even louder about the merits of contactless. As well as investing considerable amounts of money in developing technology, contactless is essential to differentiating the Visa brand in the crowded and competitive payment services market - MasterCard offers “Priceless” experiences to customers, American Express recently launched geo-location services in the UK, Barclaycard has its just launched ‘bespoke’ deals service. Visa wants to be seen to be a pioneer of technology that makes people’s lives easier. It just needs to convince people that its innovations are in their interests.