Commentary

Mega-Mobile Payments Venture Of Retailers Hangs It Up; Walmart Goes Solo

Big-league mobile payment ventures aren’t having a particularly good time these days.

Major ventures by monstrous business entities just haven’t been able to crack the mobile payment code.

First it was Softcard, the failed mobile payments venture of Verizon, AT&T and T-Mobile, which called it quits early last year.

That venture was pretty well doomed from the start, with the initial and unfortunate name of Isis.

It then changed its name to Softcard, without actually even owning the website www.softcard.com, as I wrote about at the time (Softcard Mobile Payments Closing, Shutting Down Accounts).

And now the other major mobile wallet entity known as the Merchant Customer Exchange, with the dreadful acronym of MCX, is finally officially not happening.

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There was once big market hope for both entities, at least from the perspective of major brands participating along with big-time resources (Softcard, CurrentC: The New, Big Names in Mobile Payments).

MCX faced the issue of herding lots of major cats, comprising a stellar list of member companies in various categories. Here was their lineup:

  • Retail –  Walmart, Target, Best Buy, 7-Eleven, Dick’s Sporting Goods, Kohl’s, Old Navy, Sam’s Club, Banana Republic, Sears, CVS, Dillard’s, Gap, Kmart, Lowe’s, Target, Rite Aid and Bed Bath & Beyond
  • Gas Stations -- Sunoco, Exxon Mobile, 76, Shell, Phillips 66
  • Supermarkets --  Publix, Giant Eagle, ShopRite, Meijer,
  • Eateries --  Dunkin’ Donuts, Wendy’s, Baskin Robbins, Olive Garden

The general idea was to get consumers to use the MCX mobile payment system at all these places, and rather than a credit card company making the fees, a consumer would have MCX’s CurrentC app linked to their bank account,  which would be a big savings in processing fees for the merchants.

While maybe appealing to merchants, this would require somewhat of a major consumer behavioral shift.

There were obvious signs of distress and outside bumps along the way.

For example, Apple finally bought into the idea of Near Field Communication (NFC) technology and included it in its phones to drive Apple Pay.

MCX member Best Buy broke ranks with other members and agreed to accept payments from Apple Pay. This followed a similar announcement from grocery chain Meijer.

And then Rite Aid bailed, announcing that the company’s 4,600 stores nationwide would begin accepting Google Wallet, Apple Pay and Android Pay.

But at least mega-retailer Walmart was still on board. Well, not really.

The retailer just announced it is launching its own mobile payment system starting in Texas and Arkansas, with payment capability being built into the Walmart app.

As to MCX, a statement from the CEO said the company would concentrate on “other aspects of our business, including working with financial institutions, like our partnership with Chase, to enable and scale mobile payment solutions.”

Along with the re-focus, MCX is reducing staff by 30 employees.

The Merchant Customer Exchange didn’t have a major competitor.

It actually had countless competitors hitting it from all sides.

Consumers weren’t clamoring for a new way to pay and for the ability to link a card or app directly to their bank account.

Good ideas on paper don’t always translate into market success.

And for mobile payments, Softcard and MCX are now two great examples of that.

2 comments about " Mega-Mobile Payments Venture Of Retailers Hangs It Up; Walmart Goes Solo".
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  1. Howard Hunt from MXM, May 18, 2016 at 4:22 p.m.

    Didn't help that the UX was god awful as well. It's a shame for brands and consumers as the coupons component could finally have nailed that nationwide redemption fragmentation we all face.

  2. Chuck Martin from Chuck Martin replied, May 18, 2016 at 5:29 p.m.

    Yes, the coupon and loyalty components are key, Howard.

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