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Does It Matter Who Owns the Digital Payment Face—the Digital Wallet?

Guy Berg |

With increasing market segmentation in terms of consumer tastes, along with the increasing ability to educate and introduce new digital applications and solutions, what is the probability that one solution will become the dominant face of digital payments? Is there a tipping point for a virtual payment solution through any one channel?

Apple’s iPhone experienced a tipping point from a hardware perspective but iPhone owners use a vast array of applications from multiple sources.  Google Maps is one of the few applications that holds a dominant position on the smart phone even though it competes against Apple’s late comer iMaps.  Unless a company controls the data or a unique business model, there are innumerable barriers to obtaining any level of dominance in the virtual world.

Another way to look at virtual world opportunities is proliferation of presence.  That is, rather than chasing the elusive goal of becoming the dominant face for your market segment or the overall market, make it so that your product can be found in many virtual stores to maximize the visibility and the probability that a consumer will see it when shopping for it online.  In short, keep your focus on your core product offerings and core competency and do not attempt to become something that you are not, a path fraught with many failures and very rare successes.

This approach does not suggest or encourage that contenders in the virtual space not pursue their own solution or what I referred to earlier as the face of the payment.  In parallel they can pursue and capture a sub-segment of the market with their own branded wallet solutions.  However, pursuit of the branded solution should not be at the expense of developing many relationships with those who can more easily enable reaching broad acceptance significantly more rapidly and cost effectively than attempting to do it on their own.  Ultimately the goal may not be to be the “face” per se but rather maximum enablement and penetration, which in turn gives consumers maximum choice and dramatically increases the opportunity for virtual presence.

iPod sales

Source: ZDNet, 2013

Topics: Mobile, Payments Strategy

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