Is It Apple Vs. Google In Mobile Payments?

When Visa announced Monday (Sept. 19) that it had officially sold a license to Google Wallet, it signaled a key next step in the mobile payment maneuvers. Google now appears to have the best position with retailers, while ISIS gets love from banks and card issuers, and PayPal is relying on its own online payment abilities. Then there's the mobile payment candidate waiting in the wings. Will Apple in a month or so make its NFC mobile move?

That's increasingly likely—at least if Apple is ready. This particular fight may be moving to the hearts and phones of consumers, where two players—ISIS and PayPal—have serious handicaps. But consumers see Google as a search engine that does a lot of stuff for them for free. And if any company generates even more warm-and-fuzzy feelings than Google, it's Apple.

Consider: ISIS has become the favorite of banks/issuers since the telco coalition shifted its go-to-market strategy in May. (Indications are that the Visa-Google deal was pushed in part by those ISIS changes.) Phone companies and banks? That's not exactly the short list of consumers' favorite companies to deal with. And PayPal, while it just jumped into the mobile payment pool, has a decade of its own baggage behind it, along with a long trail of irritated customers.

Currently, that leaves Google as the favorite, and you can expect to see some intense marketing campaigns aimed at consumers, but with retailer persuasion being the ultimate goal. If consumers shift strongly in one direction, that could be crucial.

But with the latest jockeying, the attractiveness of Apple in mobile payment is becoming stronger. In a battle for consumer support, Apple has all of the other vendors beaten easily. But that's an emotional connection. What about the facts?

Fact One: The biggest challenge in getting mobile payments to have any kind of decent acceptance will be through lots of early adopters. Given the fact that almost no retailers will adequately train associates, print and distribute effective signage and launch extensive awareness and customer-training efforts, many consumers will be left to figure out how to make it work on their own.

When you tried using contactless payment in its early months, think of how many associate blank stares you saw when you asked for help. When I was visiting retailers using ShopKick, I made it a point to ask a wide range of associates and managers questions about how the app should be used. Suffice it to say, none had known anything about it.

Choosing from the ISIS telco consortium, Google, PayPal and Apple, whose history suggests the best strength in creating intuitive designs?Choosing from the ISIS telco consortium, Google, PayPal and Apple, whose history suggests the best strength in creating intuitive designs? If we're going to teach consumers to swim in the waters of mobile payment, Apple's GUI efforts at least give them the best chance to not drown.

There's another fact about Apple that could prove crucial. It's the only likely mobile payment vendor that is also a legitimate national retailer. Although it's retail store revenue is tiny compared with the Wal-Marts, Targets and Home Depots, Apple is more than just a retailer. It's easy to make the case that it's the most cutting edge—and copied—retailer in the U.S. today.

Given that we're talking about mobile payment, which retailer pioneered in-store mobile payment—and has since had a laundry list of traditional retail chains copying its effort, right down to using Apple hardware.

What about merged channel (the ultimate progression of multi-channel to cross-channel)? A few weeks ago, I was in a local mall and discovered a small glitch in my iPhone. I quickly accessed the Apple site and, in less than a minute, scheduled an appointment (to happen 30 minutes later) with an Apple Genius (tech support) at their store. I walked to the store and the appointment happened right on time.

Think about what that involved. Can you think of any retailer's mobile app that is to integrated with in-store operations that it could be used to schedule an appointment with an in-store associate? The integration that Apple has created between mobile, online and in-store is nothing short of stunning, when compared with comparable efforts of much larger chains.

Set aside the GUI skills, the consumer popularity and the retail technology leadership and you have one other powerful differentiator: iTunes. Of the major contenders, only PayPal could challenge iTunes for its actual mobile payment transactional expertise and practical experience.

As we've argued before, there are a lot of strategic reasons why Apple may not want to engage in hand-to-hand combat on mobile payments and might prefer to cut a deal with someone—quite possibly Google—and simply take a big one-time check plus millions of mid-sized checks for Apple cooperation.

But if Apple opts to make the move—and rumors of an October iPhone announcement that can support mobile payments are true—it would have a lot of compelling arguments to make.

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