I understand U.S. readers may instantly lose interest in something taking place outside of their continent, but Apple Pay will be supported at 250,000 locations across the UK and there are several reasons why the launch matters.
- Mobile payments
Apple has seized a strong position in mobile payments in the U.S. – quite an achievement when consumer sentiment concerning contactless payments there was reluctant in comparison to consumer perception elsewhere. Partly as a result of years of industry agitation, European consumers are far happier to embrace contactless payments, with UK consumers particularly ready to embrace them. With Apple’s iPhone 6 series devices leading the pack in terms of smartphone sales in Europe, there’s little doubt that you can predict many thousands of customers will test Apple Pay. The existing £20 payment limit is likely to climb to £30 by the end of 2015, but does mean UK consumers will use an iPhone or Apple Watch to pay for smaller purchases and mass transit fares.
- TFL is a partner
The UK’s capital city, London, has at least 6 million residents that are already accustomed to using contactless technologies to pay their subway and bus fares. Mass transit there is run by Transport For London, which has said it will accept Apple Pay. With 24 million journeys taken across London daily, this makes it possible for Apple Pay to become part of London life very fast. And this is also likely to boost Apple Watch sales.
- Think of the data
When it comes to TFL, all those iOS device payments will become an opportunity for various kinds of app-based services and in-device data collection toward the mass transit authorities' big data efforts. Now, we already know Apple will anoynmize its data, but it isn’t too hard to imagine TFL introducing customer loyalty apps – so you may purchase tickets using Apple Pay and the TFL app, and in exchange for sharing a little more data you may find your ticket price reduced to match daily, weekly or monthly travel card deals. Most retailers should offer in-app payments such as these, as when you choose to use them you will also be asked to share more data. You won’t have to use them, but the convenience may sometimes outweigh privacy concerns – though Apple gives you that choice.
Apple Pay UK initial partners list includes: TFL, the Post Office, the Trainline, Lidl, M&S, Nando's, Boots, Costa, McDonald's, Waitrose, Wagamama, Pret, Spar, BP, JD Sports, Subway, KFC, and Starbucks. (A memo purporting to be from Waitrose is what told us to expect a July 14 launch, for example.) In the future, you expect them to tie loyalty discounts to Apple Pay transactions, including provision of Wallet loyalty apps, while collecting your data in the same way current loyalty card systems do. (Of course, as iBeacon support is rolled out in retailers on a global basis, you’ll get the chance to be saturated with special offers and loyalty discounts through your phone – though only those retailers who do so without annoying consumers truly stand to benefit from this aspect of the digital transformation of customer facing retail.)
Apple will introduce Apple Pay support in other countries in due course. Plans for launch in China are thought to be falling into place, as are those across the rest of Europe. It seems inevitable the company will also launch in Africa, India and South America, where mobile payment systems are incredibly popular.
Once Apple launches in multiple countries, it will have new opportunities to hack other profitable slices of business away from the deeply mistrusted financial sector, including foreign exchange payments, direct person-to-person payments – even the chance to offer crowdsourced loans. These opportunities can only be enhanced by its growing global reach.
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