What's In Your Wallet? Leave Home Without It? Apple Pay: Slowly Taking Off -- August 18, 2022

Updates

August 19, 2022:

Original Post

From The WSJ: link here.

Patience isn’t the most popular virtue in Silicon Valley, where companies aspire to move fast and break things, the motto that defined the age of tech excess. 

Nothing broke on the day in 2014 when Apple presented a new service called Apple Pay. 

If the quality of destruction was measured by the speed at which it happened, the flashy innovation from an industry titan would have been considered a disappointment. The idea that it would make the wallet obsolete sounded ridiculous when the pace of Apple Pay adoption underperformed expectations. Wall Street analysts and iPhone users alike were skeptical for the next few years. The experience of using a credit card didn’t seem like a problem that required a solution from Apple. 

It’s a bet that now appears to be paying off in a very strange way for our hit-driven economy: slowly. 

Apple has been picked apart for so many lessons that it could start its own business school, but what the case of Apple Pay shows is that patience is a competitive edge for companies that know how to wield it. 

Patience often sounds like a dirty word to our tech overlords—Steve Jobs wasn’t exactly Job—but only time can break certain habits of human behavior. 

Trillions of dollars in market cap buys that kind of time. Not every company has the luxury of playing the long game, but it was an indulgence the world’s richest corporation could afford. 

The percentage of iPhones with Apple Pay activated was 10% in 2016 and 20% in 2017, according to research from Loup Ventures, as most people seemed perfectly happy with their plastic cards and leather wallets. 

Adoption nearly doubled again in 2018. It hit 50% by 2020. 

Now it’s around 75% and inching closer to ubiquity. Of course, not every account that gets activated remains in active use. 

So what changed? We did. Apple’s executives remained confident about the future even when the present wasn’t so rosy because they could look at the rest of the world’s acceptance of contactless payments and see that the U.S. was lagging years behind. 

Much more at the link.

The company says that 90% of retailers across the U.S. now take Apple Pay. The number that accepted contactless payments when the service was introduced was 3%.  

Apple eventually wants your virtual wallet to contain everything from your driver’s license to insurance cards, but the company has learned that the process of replacing physical objects doesn’t happen overnight. It barely happens over decades. “There’s a legitimate chicken-and-egg problem in payments,” said Bernstein analyst Harshita Rawat. “Consumer habits are very hard to change, and merchant acceptance takes many, many, many years.”

I have photos of all my ID cards and all other important documents on my iPhone. 

I can leave home without my wallet. 

AMEX: don't leave home without it?

Capital One: what's in your wallet?