Keith O'Neill

Taking a Pulse on Mobile Payments

It seems like a good time to take a look at the status of the mobile payments industry after hearing the updates Tim Cook shared on the success of Apple Pay this week. In recent years, everyone from wireless network operators to emerging start-ups, retailers to credit card companies have gone down in flames on their promise of a mobile payments revolution. I was beginning to think I would never see mobile payments cross the chasm to mainstream adoption.

Now have hope, my mobile payment yearning friends, for a company has emerged that is making the promise of a wallet-less future real again. Among the vast graveyard of failed mobile payment attempts, it appears that Tim Cook and his team at Apple somehow convinced a respectable percentage of the skeptical public at large to “go ahead and give mobile payments a try.”  Now we don’t like to brag, but back in September when we listened to Tim Cook launch Apple Pay we fell decidedly into the eternal optimist camp and even posted this Tweet on the day it was announced:

Apple Pay

Too bullish, perhaps? 🙂

We admit that we sometimes can get a bit overly enthusiastic on big tech announcement days. But we still feel better about that prediction than the commentaries of authors like Steven Bertoni at Forbes who warned that Apple Pay could be “doomed” and “won’t fare any better, at least not right away” than the Google Wallets and Squares of the world which failed to gain mainstream momentum out of the gate. Bertoni went on to state that “When giddy Apple fans try to whip out their Apple Pay they’ll find a slick app which they can’t use anywhere.”

So let’s take a quick payments pulse and see where the truth really lies. Is Apple Pay a success? Can you use it at enough locations? Is it singlehandedly ushering in a new era of mobile payments? And what does this mean for the other ecosystem players?

In short, “yes”, any way you slice it Apple Pay is a success. When Apple CEO Tim Cook declared “2015 is the year of Apple Pay” on his investor call recently that wasn’t hyperbole. After just 3 months since launch, Apple Pay was responsible for two out of every three dollars processed through contactless payment systems. Cook went on to state that 80% of contactless transactions at Panera Bread happen with Apple Pay and Whole Foods saw a 400% percent increase in contactless payments since the service launched. And in the recent Apple Watch launch event, Cook announced that Apple Pay is now supported by 2,500 card-issuing banks and accepted at nearly 700,000 retail locations. These numbers are somewhat staggering given the lack of adoption for other high quality mobile payment options and underscores just how strong the trust is between the public at large and the Apple brand. When Apple tells you to try it…you try it.

However, before we pop the champagne and toast to Tim Cook and the Steve Jobs legacy we must all admit that mobile payments still make up a minuscule fraction of payments today. Forrester puts mobile payments at a total of $6.8 billion in 2015 out of a $3 Trillion+ market, or less than 1%. And, yes, although Apple is giving this market a real boost, we still have a ways to go before we see true mainstream adoption across all age groups and demographics.

Bertoni also had a point when he brought up how important it is for the Apple Pay option to emerge at more retailers. Luckily for Apple, the retailer embrace of Apple Pay has been surprisingly rapid with Boston Retail Partners predicting that 38% of large retailers in North America will be supporting Apple Pay by the end of this year. They also reported that they found that 56% of large retailers believe they’ll be supporting Apple Pay by the end of 2017.

This spells good news not just for Apple but for the entire mobile payments industry. Surely, Android users who see their iPhone-owning friends buying their Starbucks with a phone swipe will want to give Google Wallet a try. As Apple Pay rises in prominence it pulls the whole mobile payment ecosystem along with it.


(Photo credit: Chetan Sharma –

This fact was underscored at a recent Mobile Breakfast Series event, “The Future of Mobile Commerce and Payments”, I attended which was hosted by industry analyst, Chetan Sharma. I heard renewed optimism about the mobile payment future and tempered enthusiasm from the panel speakers on display. Chetan Sharma also presented an interesting stat from his surveys which indicated that mobile thought leaders ranked “Mobile Payments” as the top breakthrough mobile category of 2015. We couldn’t agree more.

Image courtesy of William Iven for Unsplash.

Keith O'Neill

Keith co-founded L4 Digital after more than a decade working with successful wireless and technology ventures. Keith oversees L4ʼs strategic partnerships, customer acquisition, and revenue goals. Keith is also responsible for company marketing initiatives and is the lead spokesperson evangelizing L4 products and services at industry events and to members of the press.

Share this:

More Posts

Want Alerts When We Post New Stuff?
L4 Digital. All rights reserved. All wrongs reserved. © 2008-2017