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Mobile Wallets: Looking For Convenience In All The Wrong Places

A Snarketing post by Ron Shevlin, Director of Research at Cornerstone Advisors

Lots of discussion these days regarding the adoption of mobile wallets, and whether or not they provide an added level of convenience for consumers. Writing in American Banker, Daniel Wolfe says:

“Convenience is a tired selling point for mobile wallets. The argument goes that tapping a contactless card or payment-capable phone against a special reader is so much easier and faster than swiping a card that a consumer would be eager to change their habits. In reality, most people, of course, don’t consider plastic cards all that time-consuming. Checks and cash may take a little more time than cards, but not enough to make most people demand some kind of relief.”

My take: The industry needs to redefine its perspective on mobile wallets’ convenience.


Daniel is totally right that swiping a plastic card isn’t all that time-consuming. And even if checks and cash do take longer, let’s get real here: The heavy check writers are not the people who will be adopting mobile wallets because of its promise added convenience.

But I disagree with the point regarding mobile wallets’ selling point. Convenience is not a tired selling point. In fact, more broadly speaking, added convenience is usually the best selling point — or reason for adoption — for new technological innovations.


The problem with the mobile wallet convenience story is that many people aren’t looking at it broadly enough. The real added convenience for mobile wallets isn’t at the point of tender transfer (I’m trying to avoid saying “point of transaction” because there are multiple steps in the transaction process, of which “tender transfer” is one).

Mobile wallets will prove out their convenience advantage in three aspects:

1) Receipts. Even though swiping a card is fast and easy, credit and debit transactions still produce a paper receipt. And if that transaction occurs at a Staples, Best Buy, or CVS, it produces about 3 pounds of paper receipts.

There is a growing segment of the population that wants to go paperless — not just for monthly bills and statements, but — for everything. It’s not a “green” thing. It’s a convenience thing. Managing all this paper is a huge hassle.

Personally, when I travel now, after making a reimbursable purchase, I take a picture of the receipt, email it to Xpenser, and throw the stupid piece of paper away (on the ground, of course, because I don’t want to be confused for some Green-weenie).

2) Rewards. Reward redemption is a real pain-in-the-you-know-what. Redeeming rewards at the point of sale using mobile wallets will become a key selling point for consumers to shift their behavior.

3) Coupons. Is there anything more 1980 than seeing someone in the supermarket scanning a ton of coupons at the register? Eventually, even the least likely candidate to adopt mobile wallets will recognize that the technology’s ability o to store and use digital coupons is way more convenient than what they do today.


One last question to consider: Why is the industry’s view of mobile wallet convenience so limited?

I have a theory, and it has to do with organizational structure.

In many banks and card issuers, mobile payment (and wallet) initiatives are still led by, and perhaps even limited to, the payments group.

What that means is that marketing’s, and maybe even the online channel group’s, level of involvement is limited.

No offense to the payments people, but I find that their focus is often limited to the payments transaction and how it’s processed and cleared. And not on how it impacts consumers.

Time to move over (Payments) Rover, and let (Marketing) Jimi take over.

Ron ShevlinRon Shevlin is Director of Research at Cornerstone Advisors. Get a copy of his best-selling book, Smarter Bank: Why Money Management is More Important Than Money Movement. And don't forget to follow him on Twitter at @rshevlin.

All content © 2017 by The Financial Brand and may not be reproduced by any means without permission.

Digital Banking Report | 2017 Marketing Trends


  1. Great post (again) Ron. What you describe as a broader view of the mobile wallet is exactly what I found so intriguing by mFoundry’s new offering (Fin.X) that I covered in my recent blog about the monetizing of mobile banking (http://bit.ly/R0F8oR). By building outside partnerships with firms like FIS, Diebold, Dwolla, Micronotes and the Blackhawk Network, mFoundry looked beyond the mobile wallet being just a transaction tool. Providing consumers added conveniences in a single app, there is even the potential to generate revenue.

    What was refreshing was the ‘buy’ vs. ‘build’ partnership mentality that mFoundry took that allows them to add more functionality and value to their offering going forward. This is the type of shift in mentality banks also need to take to innovate.

    Finally, with regards to your comment around paperless receipts, beyond the very fast take-up of square by taxi drivers in major cities (and the paperless receipt), I experienced the same transformation at Nordstrom last weekend when the salesperson scanned my barcode with a mobile device, had me sign the device (with my finger), and a receipt was sent by email. What a great way to not lose the transaction. Obviously, the ability to integrate this into a budgeting program is not a major next step.

    Bottom line, it is time for giant steps instead of baby steps in payments and financial services innovation that begins to look at lifestyle needs instead of relatively small tactical improvements to processes already in place. If we can build value into the equation, we can recoup at least a small amount of the massive loss in revenue that is so sought after.

  2. As a fairly deeply experienced payments guy I would say you nailed it – use the Starbucks app – thats what it is all about…Loyalty rewards and coupons for digital downloads

  3. I’m with you all the way except for the last bit: Mobile wallets are pioneered not by banks but by third-party service providers viz. Google Wallet, ISIS. Your org structure explanation shouldn’t apply to these non-banks, yet why do even they keep harping about the same old value proposition related to the core action of payment? My take on this is somewhat different: Taking on paperless receipts, rewards redemption and coupons involves a lot of parties, touches several systems and needs huge inventory of offers. I don’t think m-wallet providers are geared up for all this.

  4. Excellent read Ron, I couldn’t agree more with most points. I would add that I think a lot of the push toward mobile wallet has to do with the conveneince of having all my information in one place. I think it isn’t too far fetched to think of the day when my mobile device can house everything, ridding me of a physical wallet. Essentially, less plastic to carry around. That is a key convenience for me at least.

    When you talk about rewards, I do find it interesting that with the launch of Square Wallet and their partenrship with Starbucks, it could essentially takes away the rewards benefits of the Starbucks app which has been one of the most popular mobile payment platforms thus far.


  5. Good point. Maybe the people who work at the third-party service providers are all ex-bank and issuer payments people? 🙂

  6. Maybe it’s because I think Starbucks’ coffee sucks, but I think the company gets way too much attention. It probably accounts for 1/1,000,000,00 of 1% of all retail sales. But it gets disproportionate attention because, for a small group of consumers — albeit, those who are tech fanatics — the store represents an ungdodly percentage of their weekly food/beverage expenditures. Wasting $5+/day for crappy coffee — with made up names — should be grounds for psychiatric examination (or a job in the Obama administration).

  7. Ron I’ll buy you a drink for that comment on Starbucks. I guess one important aspect of wallet, when it reaches maturity, should be its power to provide pre-purchase and post-purchase alerts/insights, starting with something as simple as the credit balance on my card. That is something the plastic cant provide. As a user of more than one card, I would also feel great if I am prompted as to which card I should use as a pre-purchase insight depending on a combination of various things – something the plastic cant provide. I truly believe in the value of a good e-wallet. Its just that people are not ready to accept the baby steps before making it run

  8. 1,000 Words Photography says:

    Do you think it is more akin to “putting a man on the moon”? Meaning, are companies pursuing this more for just bragging rights of “Look at what we did” than actual convenience for the customers it is supposed to help? That’s kind of how I see it.

  9. Ha! You said grounds…

  10. Ever since I saw a EUR 4, then USD 4, then GBP 4 price tag for Starbucks, I’ve been a “Starbucks skeptic”. But, given the adulation it enjoys everywhere, I was forced to keep my thoughts to myself. I was eagerly waiting for Starbucks to enter India to see if it’d be available for INR 4, in which case I could change my mind. It has finally entered India a month ago, it’s not selling anywhere close to INR 4 – the entry price is the INR-equivalent of USD 2 – so I remain a Starbucks skeptic. At least, after reading the above comments, I don’t feel so lonely and can boldly out my thoughts.

  11. Another factor to bear in mind is symmetry – a wallet should be a way to take money as well as make payments. Also note that most of the stuff in your wallet is really about identity, not payments, so identity-related value-networks will determine the path, I suspect.

  12. Good points, Dave. I still think it comes down to convenience — whether it’s about identity, payments or whatever purpose people have for their wallets. When the added convenience of a digital wallet exceeds some “boiling point” for a consumer — they’ll switch.

  13. If Instagram is kicking up a privacy storm (ooo topical)… Then imagine what wallets that store your identity online would do?

    A bank used to be where you store your valuables. In the 21st century, your most valuable asset is likely your identity. Therefore, could banks make a play at “storing” or “managing” your identity credentials?

    How does this work with government? How does this work across multiple banks? How does this alleviate privacy concerns?

    There is an argument that says we moan every time our privacy is eroded, but ultimately don’t mind being the product that is sold. So whilst every wallet maker says “coupons” and “advertising” a lot, they may be missing the real trick in all of this. If identity is the play, then establishing the mechanism for managing identity must be the goal.

    Something like that needs either an EMVco or similar…

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