Profile: Jeremy Gilley

The man marketing world peace

Brands to ramp up NFC consumer education programmes

Brands including Barclaycard and McDonald’s are set to roll out awareness campaigns about using contactless payment, a move that comes as the former brand admits the industry needs to do more to educate consumers and drive usage of NFC technology.

/g/s/e/barclaycardnfc160.jpg

Just one fifth (20%) of contactless card owners have ever used their cards to make a contactless payment, according to YouGov’s Mobile Wallet study. Only 5% of those owners use their cards for contactless transactions more than once a week.

Barclaycard, which alongside parent brand Barclays has the highest share of the contactless market, with 71% of all NFC payment cards, will look to increase awareness of the technology by launching a series of integrated marketing campaigns to educate consumers about its benefits as a cash replacement.

Tom Gregory, Barclaycard’s head of digital payments, says: “We have seen a doubling in contactless transactions in the last year but it’s nowhere near where we’d like to be. Awareness is the key metric we need to drive this year and we want to continue to lead and drive the [entire contactless] market.”

He adds that despite Barclays having the stronghold of the contactless market, the brand is not “big enough” to change consumer purchasing behaviour alone and that retailers, credit and debit card brands, mobile manufacturers, operators and Google must align together as an industry to promote the technology.

McDonald’s is the most recognised contactless payment retailer, but only a minority (8%) of the British population know that consumers can use NFC technology to wave and pay for products at its restaurants, according to the YouGov study.

The fast food outlet will soon be expanding its in-store contactless communications programme to feature a strip on its tills to promote the fact that consumers can swipe their NFC-enabled cards to pay more conveniently.

Waitrose is thought to be rolling out contactless terminals across all its stores by the end of the year in a bid to speed up transaction times.

BlackBerry is also readying a range of consumer education campaigns about contactless payment in the coming months after predicting that 2012 will be the “year of NFC”.

For financial services brands such as Barclaycard, an increase in use of contactless could increase transaction revenue, while retailers want to boost service by reducing waiting times.

The contactless industry is in line for a major boost around the London 2012 Olympics, which has been predicted by a number of brands and commentators to be the “first contactless Olympics”.

Official sponsors Visa and Lloyds TSB are partnering to launch an “Olympics phone” with in-built contactless technology as part of the strategy to encourage consumers to swipe and pay for items around the Olympic site rather than use cash.

Transport for London also set out a strategy last year to implement contactless credit and debit card payment facilities across the entire bus, Tube, Docklands Light Railway, tram and Overground network by the end of 2012.

Deloitte’s predictions for NFC

200 million contactless credit and debit cards to be in circulation by 2015
300 million NFC smartphones, tablets and e-readers sold by 2013
700 million people to be using mobile money services in emerging markets by 2015

Readers' comments (1)

  • It's no surprise there is currently a low level of contactless card payments and a call for a greater focus on education from banks and retailers.

    With any new payment technology there is bound to be a learning process and hesitancy about its usage. In the early days of Chip&PIN, there were many misgivings about it but now it is the norm with minimal user concerns.

    The uptake of contactless payments will undoubtedly increase in the near future, but it will be driven less by card usage and more by mobile phone use. That’s partly because this year we are going to see a significant uplift in the number of NFC-enabled handsets being shipped. Without a doubt, those with most to gain – banks and retailers – will have to educate and encourage consumers to use their phones for payments but they will be aided by the increased use of mobile NFC in proximity marketing.

    Very soon, mainstream advertisers will be embracing NFC technology to offer vouchers, incentives and exclusive content from NFC tags that have been placed on posters, point-of-sale displays, product packaging or signage on the high street or in-store. Consumers will quickly become familiar with tapping a poster for a money off coupon for a fast food outlet or an exclusive film trailer for the new Hollywood blockbuster. Realising the benefits that can be gained from interaction with previously passive media will gain momentum and that in turn will help make the transition to mobile payments less of a leap of faith as it might be now.

    We know from our work with brands in the mobile and financial sectors that plans for developing mobile contactless payments strategies are already well advanced. Many smart phone users are already comfortable using apps, banking and making online payments via their mobile. Mobile contactless payments is the next logical evolution. Once consumers become familiar with the concept, courtesy of some impactful marketing communications from trusted brands, mobile payments will very quickly become the accepted norm.

    Unsuitable or offensive? Report this comment

Have your say

Mandatory
Mandatory
Mandatory
Mandatory

Related images

Job of the Week

Top Jobs

social

+media Facebook Twitter LinkedIn
knowledge+bank