Device- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
Watch E-WalletsDevice- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
Watch E-WalletsDevice- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
Watch E-WalletsDevice- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
Watch E-WalletsDevice- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
Watch E-WalletsDevice- or Internet-based software poised to manage consumers' shopping and payment activities.
As smartphone s begin to proliferate faster than both PCs and traditional cell phones, the buzz is beginning to grow about a future filled with "e-wallets."
Are you ready? An electronic wallet is basically a piece of software that stores personal and payment information either on a device (such as a smartphone or an iPad) or hosted by a party on the Internet. And some technology pundits predict that the time will come - in the not-so-distant future - when consumers will use electronic wallets to manage all their shopping and payments activities.
Here's an interesting excerpt from Time magazine about the growth of electronic wallets:
Shoppers wa ? ti ng to get the ir caff� i ? e fix online at Starbucks.com now have only one path to take when they pay for their beans...
But wait, here's something a bit more revealing about this quote:
If they are already registered with Passport, Microsoffs new identity-verification program, they can use it to complete their purchase.
You see, this quote is actually from a 2001 issue of Time, when folks were first predicting that electronic wallets would take over our usage of traditional credit and debit cards. It's always hard to predict how fast new technologies will be adopted by consumers and, in the end, Microsoft's Passport proved to be a disappointing flop.
But what if electronic wallets became as popular as Apple iPads or Amazon Kindles are today? During 2011, innovative companies have made the first moves around their wallet strategies. Here's a round-up of the players and what they are doing in the marketplace.
Google Gets Early Buzz
In a venture with Citibank (www. citibank. com) and MasterCard (y^ww. master card. com), Google recently introduced its Google Wallet (www.google.com/wallet) application to manage payment, loyalty and special offer information. Retailers that have already agreed to support the contactless payment aspect of Google Wallet include Walgreens, Subway, OfficeMax, and Toys "R" Us.
While Google has caught early buzz, the contactless functionality of this wallet is only available on Sprint phones today. Like many early technologies, it will take time to work across most devices.
PayPal Aims for Big Changes
PayPal (www.paypal.com), owned by eBay (www.ebay.com), wants to completely change consumer shopping behavior. The company envisions a future in which consumers regularly use PayPal for mobile online purchases as well as in stores, and eBay barcode readers on smartphones will arm shoppers with powerful comparison shopping technology.
PayPal is preparing to introduce an electronic wallet with some pretty cool features. For example, PayPal's wallet will allow customers to change their method of payment after they make a purchase. A user could pay for something in a store with MasterCard, take the merchandise home, and then later switch the payment method to his or her Visa without any additional fee.
Apple Streamlines Orders
Apple (www.apple.com) is rumored to be planning an iPhone with near-field communications to support mobile payments, but no release date has been announced so far. However, Apple has launched an app that enables users to place orders for pickup at their local Apple Store, and enables self-checkout at Apple stores.
Reports have Apple promising a turnaround of 12 minutes from when a customer places an order for an in- stock item and when it will be available for pickup. Talk about the perks of a multichannel world!
Steps to CU Readiness
As credit unions watch these consumer payment trends unfold, credit union executives should take the following five steps to avoid being caught blindsided by e-wallet innovations:
1 Internally recruit wallet testers. Every credit union should find a cadre of folks knowledgeable about IT, marketing and retail delivery who can serve as the "early adapter" team and test wallet offerings early.
2 Create an executive learning event around wallets. Electronic wallets and mobile payment strategies should be understood in more detail by credit union executives. A planning session where vendor offerings are reviewed and wallet users provide first-hand perspective would be time well spent.
3 Understand the wallet vision and road maps of payment vendors. Credit unions should study the research and development and alliance efforts under way for wallets - and payments in general. Check out what's happening with your credit and debit card processors and payments networks.
4 Review consumer adoption and the competitive landscape each yean As part of your credit union's annual strategic planning efforts, review how well electronic wallet and mobile payment technology is "sticking." Based on what you find, decide how urgently your credit union must act.
5 Build loyalty around payment cards as soon as possible. However electronic wallets are adopted, it is clear that most consumers will evolve their purchasing habits from their current relationships. When wallets first start going mainstream, they will hold a consumer's most-used debit and credit card information. The most critical tangible action a credit union can take concerning a future of electronic wallets is to penetrate its member base with large, active debit and credit card portfolios.
In much the same way that music, entertainment and navigating directions became key components of our mobile phones, consumers may soon be using a smartphone app as the centerpiece of their payments activities. Credit unions need to become more engaged in these innovations before it's too late to play a relevant role.
[Sidebar]
Resources
Search for "payments" at cumanagement. org/archive/indexto read free related articles, including "Marvelous Mobile" and "No Cash for Coffee."
Search for "card rewards" at eu m an age ment.org/archive to get free articles on how to boost your programs before e-wallets hit. You may be especially interested in "Debit Card Rewards" and "Choosing a Vendor."
Eric Weikart of Cornerstone Advisors will help lead CUES' inaugural "School of Growth and Profitability," slated for May 1-3 in San Diego. Learn more and register at cues.org/sgp.
Terence Roche of Cornerstone Advisors will speak at CUES Execu/Nef", slated for Aug. 19-22 in Big Sky, Mont. Learn more and register at cues.org/execunet.
Learn more about Cornerstone's strategic and technology offerings at cues.org/cornerstone.
[Author Affiliation]
Steve Williams is a principal with Cornerstone Advisors, Inc. (www.crnrstone.comA a CUES Supplier member and strategic provider based in Scottsdale, Ariz.
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