Profile: Jeremy Gilley

The man marketing world peace

Contactless payments stalled by 'speed'

ICM Research issued a damning report into contactless technology this week, which suggested a lack of marketing support from retailers is stifling uptake of the wave and pay method. This comes in spite of consumers’ high level of awareness in contactless payments. Shoppers haven’t been told why they should use it, so they simply don’t bother.

Lara O'Reilly

Of 26 high street stores visited on ICM’s mystery shop, just 11 offered contactless payment facilities and of those that did, only three visibly promoted the technology.

And while 80 per cent of respondents to the online consumer survey claimed to be aware of contactless payment, one in seven only realised they actually owned a contactless card when asked to check the symbol on the cards in their wallets.

A separate study from eDigitalResearch, which looked into mobile contactless payments, found that while awareness is on the increase, the consumers it surveyed don’t think that there are any benefits to the technology “whatsoever”.

I’m inclined to agree with them.

ICM pinned the blame on retailers dragging their feet by not doing enough to market contactless technology in-store.

More than 140,000 contactless payment terminals have been set up in the UK to date. Perhaps more of the industry’s budget should have been towards marketing as well as for the installation of the technology to facilitate such payments.

Much of the marketing from contactless card providers so far has focused around “wave and pay”, which they claim will help consumers save time and free up more staff for customer service queries.

But to convince consumers to change their purchase behaviour, the industry needs to do more than tell them they can save a couple of seconds. We’re not all that busy that we can’t afford two seconds at the till any more - just think how many hours a week people waste on social networks.

In fact, given the limited education staff at retailers have been given about using contactless, trying to wave and pay”over a terminal is likely to add more seconds to the process - a process that still involves queuing, speaking to a staff member and waiting for the transaction to go through.

At the moment the argument for contactless payment is less than convincing.

Just as EE has extended its marketing around 4G to include its add-on services, the contactless industry needs to focus on much more than speed. Why have more campaigns not been geared around security, loyalty, deals or other bolt-on offers? Perhaps TfL’s move to include contactless debit and credit card payments on the capital’s buses and trains will help push convenience over speed, but there’s clearly a long journey ahead yet.

If the contactless payment industry really wants the technology to take off in the UK it must focus on the added benefits contactless can bring, rather than base its communications around a proposition that - for the moment anyway - is not necessarily true.

Readers' comments (4)

  • Well said, Lara. I've been disappointed with most of the contactless, mobile payment systems that I have used. Whenever I go to my local Starbucks and attempt to use the company's iPhone app to pay for my coffee, I often find that the baristas don't fully understand how their mobile payment system works. And if they do, paying with an iPhone requires what appears to be at least an extra step for the cashier, taking additional time in the purchasing process. As a consumer, I'm at a loss as to the benefit of mobile payments if it actually requires more time and effort to make payment than doing so via a credit card or cash.

    Mobile payments have significant upside for brands and marketers. But the value to consumers is not yet clear. Until that is the case, I'm afraid the hype surrounding mobile payments will continue to outstrip consumers' use.

    Keith Trivitt
    Director, Marketing and Communications
    MediaWhiz

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  • I have found only for transactions up to £10. Completely agree, retailers prefer chip and PIN terminals even if they have a contactless one.

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  • Keith - The wave and pay doesn't really need a phone (although it can be with a NF equipped phone), its designed to be an updated credit card that just skips the entering of a pin. Just wave in front of terminal job done, theoretically quicker!

    The one big problem is the security, as it contactless anyone within range can read your card, dumb is not the word for the idiots who designed this system, although for the unscrupulous marketers amongst us there is the potential to identify and track people without their knowledge - wait for the law suits!

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  • The other week I was in Costa with a friend. She took out her debit card which was snatched by the sales assistant who waved it over 3 card readers.

    My friend, like myself, had never used contact-less due to the dishonest selling of the cost of security risks.

    She complained and the manager had to refund the payment. She then paid by chip and pin.

    I am currently trying to complain to my banks re:- lack of opt-out from contact-less. I know it is futile but at least it may appear on their statistics. The last time I tried I got a polite letter explaining how stupid I was.

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