Mobile payments in the U.S. are expected to triple to $142 billion by 2019, according to Forrester. But new research from Horizon Media finds that Millennials and men are embracing mobile payments at an even faster rate than the general population. Two-thirds of 18- to-34-year-olds (63%) have used a mobile payment app to make purchases, compared with 48% of 35- to-49-year-olds and 22% of adults 50-plus. Almost half of men (48%) have used a mobile payment app, compared to 36% of women.
Among mobile phone users as a whole, mobile payment apps are on the way to becoming commonplace. More than four in 10 (42%) smartphone users have already used a mobile payment app on their phone to make a purchase. These users primarily used PayPal (39%) or Google Wallet (14%). Still, Apple Pay is expected to further move the trend toward mainstream acceptance.
"Apple Pay is just the latest entrant in the mobile payment space lending even more credibility to this emerging industry," says Sarah Bachman, vice president of mobile strategy at Horizon Media. "Many client verticals will be impacted by this evolving technology and should begin preparing for this new ecosystem if they haven’t already."
In fact, consumers believe in the potential of this new ecosystem to transform their everyday payment habits. More than a third of mobile phone users (36%) say Apple pay is “the payment system of the future” and almost four in 10 (39%) say they like the idea of not having to carry a wallet, cash, or credit cards. Millennial and Gen X mobile phone users are particularly excited about Apple Pay. Nearly six in ten 18- to-34-year-olds (59%) say they have not used Apple Pay but would be interested in trying it; more than half of 35- to-49-year-olds (54%) say the same.
If Apple delivers on the seamless, intuitive experience consumers have come to expect from the brand, converting the unconverted is certainly within reach. The top interest drivers among all mobile phone users when it comes to Apple Pay are convenience (53%), and the belief that fingerprint verification “sounds easy and secure” (53%).
"It’s telling that the security of Apple Pay’s fingerprint verification is tied with convenience as the top interest driver," says Kirk Olson, vice president of Trendsights at Horizon Media. "People who want to try Apple Pay appear not only comfortable, but convinced that Apple has worked out the security issues in mobile payments. It’s as if Apple entering mobile payments is a stamp of approval for the whole category."
Even limited availability isn't hindering consumers’ interest in Apple Pay. Only 15% of mobile phone users who have not used a payment app say it’s because they don’t think it will be accepted at most places they shop. "We thought that with some big retailers like Wal-Mart and CVS not getting on board, more mobile users would cite lack of acceptance as a reason they wouldn’t use it," says Olson. "Instead, those who aren’t interested are either concerned about security or not open to mobile payment technology at all."
Protection, on the other hand, is a top concern with mobile payments. Nearly half of respondents cite concern about the security of the payment (49%) and privacy of their information (44%) as things that have held them back from using mobile payment apps. So it stands to reason that Apple not saving transaction information stands out as a differentiator -- more than a third (38%) say this influences their interest in the Apple Pay.
In the end, there's undeniably one winner when it comes to Apple Pay: Apple. Almost half (49%) of mobile phone users who are interested in Apple Pay say they are somewhat or extremely likely to buy an iPhone 6 or 6 Plus just so that they could use Apple Pay. And 63% of current iPhone owners say they would invest in a new phone to use Apple Pay.
"The strong interest numbers bode well for Apple Pay’s future," says Olson. "For retail brands marketing to segments who tend to be heavy mobile users, touting acceptance of Apple Pay can only help. It’s a great way to highlight how the brand is on board with 'the payment system of the future.' But that doesn’t mean it should be the centerpiece of a campaign. It’s still a small user population."