The Apple Pay refuseniks at CVS won’t win this battle

the apple pay refuseniks at cvs wont win this battle

The fact that the CVS network of US retailers has decided not to support Apple Pay isn't such a big deal -- it's precisely the kind of fragmentation that caused Apple to wait for a few years before entering the payments industry.

Payment chaos

You see, on a global basis there are or have been numerous mobile payments systems. When it comes to NFC the industry has been extraordinarily fragmented, which led to the creation of numerous incompatible technologies to support NFC payments as retailers, bankers, and payments processing firms all battled for dominance.

No great surprise that Apple Pay was released alongside similar initiatives from Visa and Mastercard. There's no doubt Apple's well-connected Apple Pay teams worked closely with key partners to create the harmony it takes to enable a system that works.

It's not just about payments, of course: the future of omnichannel retailing will be another battleground for privacy in the connected age.

Privacy chaos

The link between payment systems and loyalty schemes has zero to do with your convenience, but everything to do with maximizing profits at your local store. No surprise then that a grab for all your information is also part of the CVS Pharmacy attempt to undermine Apple Pay. These retailers want to know who you are, as well as what you buy.

Apple's system enables slightly better privacy -- it's not fool proof -- the beauty of big data systems drawing source information from multiple locations is that a small hint about you in one system can be cross-referenced to information held in another data trove to get some sense of your identity, as Forbes writes here.

All the same, Apple's solution is a start. You can see why those who don't value you for you but value you for the money they can take from you want the data Apple could collect. They're really annoyed Apple won't play ball. After all, Google probably will.

Loyalty chaos

In future of course, Apple will create its own loyalty system that attempts to protect customer privacy while enabling the advantages of omnichannel retail to smaller retailers. Such predictive customer journey management systems are yet another advantage larger retail brands have against their competition. Modern retail is like a David and Goliath struggle in which David has no slingshot.

I'm not too worried about the CVS chain and its decision to abandon Apple Pay. I don't imagine its own alternative payment system will succeed. It is a great illustration of the kind of intransigent stupidity that you get when you allow reactionary corporations to favour their own well being above that of the society in which they reside.

Or just pay cash

The beauty of moving toward standardized solutions that work anywhere is that customers gain consistent experiences while retailers create closer and more trusting relationships with them. But you won't see too much of this at CVS until it abandons its payment scheme (I imagine) toward the end of 2015. "Because customers didn't demand (use) it."

It doesn't matter too much I guess. After all, you can still use cash -- even at a CVS network store.

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