Oct 29, 2013 Dave King
Mobility has been increasing in both the consumer and enterprise sectors in recent years. Major advances in smartphone technology and the advent of the tablet have changed the way individuals and businesses operate.
Now, more than ever, consumers are seemingly always connected to their mobile devices, which has led many financial experts to predict a spike in mobile transactions in the coming years. So far, mobile payment portals have not seen significant adoption rates, as a large market has been fragmented by an incredible number of competing mobile processing companies.
Despite the lagging adoption rates, there is reason to believe that 2014 may be the year in which significant use of mobile payments increases. Forbes recently highlighted a Gartner study that named mobile technologies as some of the top strategic trends that will be showcased in 2014. In particular, the source noted that developers will shift their focus from application coding to overhauling user interfaces on mobile products in the next year. These IT professionals will look to create more intuitive voice and video models that further enhance user connectivity.
Competitive market, fragmentation to limit mobile pay
However, the source indicated this will mean a decrease in app construction, which could limit the ability of payment processing firms to get into the mobile transaction market. Many current mobile pay vendors use customized smartphone and tablet apps to leverage their portal solutions. If mobile device payment is to proliferate at an accelerated rate in 2014, payment firms may need to find more innovative ways for users to access their services.
Another barrier to mobile payment use that is sure to challenge the market next year is the continued spike in mobile device diversity, particularly in the workplace. The bring-your-own-device (BYOD) movement will continue to gain momentum in 2014, the source indicated, which will likely make it difficult to create a single program solution that is able to extend across the various devices, operating systems and wireless carrier networks that will be found in different combinations as BYOD picks up even more steam.
The saving grace for mobile payment companies could be greater IT proficiency. The source speculated that more organizations will need to enhance their mobile device management strategies to ensure employee-owned smartphones and tablets are easy to regulate and secure in the office. Potentially, this improved dedication to security could limit the number of complex mobile configurations on the market, making it easier for mobile pay providers to create fewer portals for consumers to access. After all, professionals represent a major source of revenue and a significant amount of transactions.
Data plans undervalued
Despite the major strides mobile companies have made in recent years and the endless demand for new on-the-go services, Americans still place a low value on their mobile data plans. There seems to be a misconception among many industry experts that consumers in the United States are highly reliant on their smartphone data limits.
However, a survey from Cisco indicated that many U.S. mobile users still place a higher priority on other communications mediums. In fact, 64 percent of American survey respondents said mobile data plans would be the first or second communications service they would drop if they had to limit their monthly expenditures. That mark was higher than the number of respondents who said the same regarding paid TV, landline phones, mobile voice and broadband solutions.
This data shows that smartphone developers still have work to do to get users more active on their devices. If payment processing firms want to increase their mobile transaction rates, they need to offer a truly innovative user experience that provides useful tools to consumers. If they stick to the same lackluster model, it may be difficult for them to succeed in such a competitive market.