Mobile Payment


Travel Tech

The Apple iPhone 6 launched on Friday of last week, and was accompanied by the usual scenes of people queueing in vast numbers all over the world in an attempt to get their hands on it on launch day. The iPhone is always an important release for Apple, given that it remains the company’s flagship device, but this is a particularly important generation of the iPhone for the consumer electronics giant as the iPhone 6 Plus model is Apple's first ever phablet-sized device.

Apple prioritises mobile payments

Apple has packed a variety of features into the iPhone 6 in an attempt to make it appeal to consumers. However, the most important of these new features in terms of the long-term implications for the mobile industry is the focus on mobile payments which Apple has emphasised with the iPhone 6. With competing technology already available, Apple are putting the Apple Pay system at the heart of the functionality of the iPhone 6, and for the first time the iPhone will now have Near Field Communication (NFC) compatibility.

As mobile payment is expected to become a massive marketplace in the future, Apple are evidently attempting to become the market leader sooner rather than later. Some of the bolder predictions related to mobile payments have indicated that by 2020 this convenient form of paying for goods and services will almost have completely eclipsed cash, cheques and credit cards. In fact, Mashable reported on a study conducted by Pew Research Center’s Internet & American Life Project and Elon University’s Imagining the Internet Center which asserted this over two years ago.

The technology media has already revealed that Apple has ensured that the NFC payment technology in the iPhone 6 is only compatible with Apple Pay. While other competitors exist, and have a headstart over the embryonic Apple mobile payment system, when Apple releases a form of technology it is a big deal. Already reports are emerging that big brands, banks, retailers and telephony companies are all scrambling to sign up for the service. For example, Visa has announced that its Visa Token Service will be compatible with the Apple iPhone 6 from its launch date.

Opportunities for travel businesses

Thus, companies in general would do well to pay attention to this new Apple mobile device, and particularly for travel-related companies there are a wealth of opportunities promised by this technology. Obviously when mobile payments become a big part of everyday life, which looks increasingly inevitable, then it will be essential to offer this feature to customers. But businesses can gain a commercial headstart now by ensuring that their operations are compatible with this important developing technology.

Mobile payments could be particularly valuable for businesses that are based in airports, which rely on airline flights, or that are based in or related to hotels. The big selling point of mobile payment systems are their convenience, and initially focusing on situations where customers may be weighed down by heavy baggage and require an easily accessible payment system could pay dividends. And given that Apple Pay is now a fundamental part of the world’s best selling smartphone, it would be an exceedingly poor business strategy to ignore it.

Apple has already included iBeacon technology within its range of smartphones, and this also promises to provide travel-related businesses with a great deal of marketing functionality. The Digital Tourism Think Tank has previously reported on how this technology is providing commercial and marketing opportunities for both destinations and travel businesses, and this tool will only become more powerful now that Apple has integrated mobile payments within the iPhone 6.

Although mobile payments are creating a buzz in the technology industry, one barrier that must be breached before it is taken up by consumers on a broad basis is achieving the trust of the public. There is still a certain amount of suspicion related to the security of mobile payments, and recent hacking and malware issues certainly do not improve this perception.

However, it is worth noting that Apple products are notoriously resistant against malware and fraud attempts, and recent statistics reported by Forbes magazine indicated that in fact 97% of malware in 2014 was associated with the Android operating system. This is used by Apple’s major rival the Samsung Galaxy range, among other handsets, while Apple arms the iPhone 6 with its own proprietary iOS 8 software.

Mobile commerce blooming

All of the statistical indicators point to the fact that mobile commerce is becoming increasingly important. Global mobile commerce levels increased by 31 percent in the first quarter of 2013, which was attributed partly to increasing use of tablet computers and improved functionality related to customer service. This growth isn't restricted to the Western marketplace, though. China is the nation with the highest percentage of consumers who purchase products using mobile technology, which is not to be sniffed at given that China has a vast population of 1.3 billion people. Clearly this is an enormous potential marketplace, and it’s therefore hardly surprising that worldwide mobile payments are expected to reach $1 trillion by 2017.

Apple Pay may still be in its infancy, and consumers may still need a little convincing about mobile payments, but travel-related businesses would be extremely well advised to heed the importance of this technology as soon as possible.

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