After a month of big Apple releases, we received a few questions from our customers regarding Apple Pay; especially about for the opportunities our team saw relating it to their businesses.
Since this is not the first time we’ve had similar questions from clients, as new tech services are unveiled, we decided to create a blog series called “Asked & Answered”, where we’ll answer questions adding our perspective on what a particular service (or device) could do for small businesses. Welcome to the first Asked & Answered!
Q1. “WHAT IS APPLE PAY?”
Apple Pay is a mobile payment and digital wallet service by Apple.
Relevant: a digital wallet is an electronic device that allows us to make transactions online.
Apple Pay is set to launch this October in the United States (for the iPhone 6 and 6 Plus, and Apple Watch-compatible devices, like iPhone 5). Its purpose is to allow users make payments using Apple devices.
Q2. “WHAT IS APPLE PAY SET OUT TO DO?”
Basically: to change how we pay for purchases by providing a simpler payments environment for users (customers).
Streamlining the payments process means that payments are to happen without opening an app or waking our displays. Users can store all their credit cards data in Passbook, then choose which card to use for each transaction.
Q3. “HOW EXACTLY DOES IT WORK?”
From a user’s perspective, and with an iPhone:
Once ready to make a purchase, all there is to do is hold the iPhone near the contactless reader, while holding Touch ID. A vibration and a beep will indicate once a payment information was sent.
Relevant: Touch ID is Apple’s name for their new biometric fingerprint authentication technology.
Still from a user’s perspective, but with Apple Watch:
By double-clicking the button next to the Digital Crown, and holding the face of the watch near the contactless reader. A pulse and a beep will confirm that the payment information was sent.
Last one from a user’s perspective, with iPhone, and inside apps:
By checking out selecting “Apple Pay”, and using Touch ID.
Q4. “HOW IS APPLE PAY LINKED TO SMALL BUSINESSES?” “WHAT ARE ITS BENEFITS?”
Here are two aspects where Apple Pay could benefit small businesses greatly:
1. Customers can be reassured in terms of security & data.
Apple Pay features multiple levels of security to ensure consumers’ credit card data is relayed safely from the merchant to the credit card company, and back. After consumers store their credit card data in the Passbook iOS software application, their identities will be verified at the point of purchase using the Touch ID sensor.
A merchant will never get consumers’ names or credit card numbers, which means that businesses won’t have to worry about losing a customer’s credit card information, since it will never have it in the first place. The most recent purchases are kept in Passbook, but that’s it.
2. It will aid in e-commerce transactions, and address cart abandonment.
We’ve written about this too: one of the biggest problems in e-commerce solutions is cart abandonment.
Apple Pay could help eliminate the gap between online and offline shopping, since the same system will also let buyers pay for items on the Internet. Retailers will be able to incorporate Apple Pay into the online checkout systems on their website, as well as in a business’s dedicated app.
For iPhone users, Apple Pay could be a handy alternative to other Web-based payment systems like PayPal. This is a great opportunity for small business owners to get information on how to incorporate Apple Pay into their e-commerce efforts (something we will happily do!).
As for reducing mobile abandonment, merchants will be able to identify an Apple Pay elegible device and offer users the option to checkout using that method (not requiring users to type account numbers, billing and shipping addresses is helpful every time).