Apple (NASDAQ:AAPL) introduced new iPhones, a watch and, notably, the long awaited mobile wallet that will tie together hardware, software and retail in an entirely new way.
The series of announcements are among some of the most important advances in the mobile retail space. Apple's iPhone 6 and 6 plus will likely be big sellers when it comes to hardware but the watch and payment technology promise to transform the retail experience.
Apple Watch functions as a communication and health and fitness device, and works with the company's new payment system.
Apple Pay supports American Express, MasterCard and Visa, lets users link their iTunes payment information and works only with the iPhone. Big retailers are already on board including Bloomingdale's, Disney Store and Walt Disney World Resort, Duane Reade, Macy's, McDonald's, Sephora, Staples, Subway, Walgreens and Whole Foods Market.
"(Tim) Cook's observation that previous mobile payment platforms had failed because they did not focus on the customer experience is absolutely right," said Pascal Caillon, general manager North America, Proxama. "Apple Pay's design interface and ease of use certainly help this, but it's all the other things beyond just payments that NFC technology offers to enhance consumers' everyday lives."
A selling feature of Apple Pay is its security, and comes at a time when data breaches and fraud are at an all-time high.
"Security and privacy is at the core of Apple Pay. When you're using Apple Pay in a store, restaurant or other merchant, cashiers will no longer see your name, credit card number or security code, helping to reduce the potential for fraud," said Eddy Cue, Apple's senior VP of Internet software and services. "Apple doesn't collect your purchase history, so we don't know what you bought, where you bought it or how much you paid for it. And if your iPhone is lost or stolen, you can use Find My iPhone to quickly suspend payments from that device."
Security issues are key and the timing is right for this product. A year ago consumers yawned when asked about security or privacy concerns. Then Target had a massive data breach, followed by Neiman Marcus, Michaels, Sally Beauty and now Home Depot.
Checkout lanes at all Whole Foods Market stores already accept industry standard Near Field Communication (NFC) payments via pads at store checkout registers. And Target, perhaps the largest retailer to suffer a high-profile data breach, will begin accepting Apple Pay in October.
"We know mobile is becoming the front door to Target, and we're focused on creating the best possible mobile experiences for our guests," said Jason Goldberger, senior VP of Target.com and mobile. "We're thrilled to support Apple Pay to streamline how our guests pay in the Target app–this absolutely makes purchasing from Target's mobile app easier than ever."
And while easy and convenient is important, security may be Apple's new mobile product's biggest selling point.
-See this Apple announcement
-See this Apple announcement
-See this Target blog post
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