There has been some debate on Finextra of late as to whether Mobile Wallets and Payments are mainstream, or whether we are still years off seeing them have some real impact on commerce and payments. I thought I would give the Finextra community the benefit
of some simple research that shows that not only are mobile payments gaining traction, but for many retailers and service providers mobile already represents either a significant chunck of their revenue, or in many cases, most of their revenue.
Here are a few examples:
Starbucks revenue this year is estimated to be $14.6Bn in revenue, 30% of which is through their Stabucks Card, or 10% of which comes through dedicated in-store mobile transactions according to the Chief Digital Officer Adam Brotman - seehttp://www.mobilecommercedaily.com/starbucks-sees-almost-100pc-growth-yoy-in-dollars-loaded-on-mobile-cards
This New York based food business will generate $100Mn in revenue this year, 30% of which is through Mobile - http://www.reuters.com/article/2013/02/13/us-seamless-revenue-idUSBRE91C17M20130213
Fandango's mobile purchases increased by 170% in 2012 to 30% of all their purchases, leading to a total of $72Mn in mobile sales - http://www.internetretailer.com/2013/01/02/fandangos-mobile-ticket-sales-soar-171-2012
Uber is expected to generate $125Mn in revenue purely through their Mobile App in 2013 - http://allthingsd.com/20130822/uber-filing-in-delaware-shows-tpg-investment-at-3-5-billion-valuation-google-ventures-also-in/
Amazon does $5Bn in mobile sales via apps according to Citi Analysis - http://www.pymnts.com/briefing-room/mobile/playmakers/2013/Report-8-Percent-Of-Amazon-Sales-Are-Mobile
Apps Store revenue via mobile purchases already totals $26Bn, 17% of which is in-App purchases/sales - http://techcrunch.com/2013/09/19/gartner-102b-app-store-downloads-globally-in-2013-26b-in-sales-17-from-in-app-purchases/
EBay, PayPal, Braintree
EBay did $13Bn via Mobile last year,
PayPal does $20Bn of it's $44Bn in payments via mobile (that's close to 50%) and Braintree will do
$12Bn this year in dedicated mobile payments ($46Bn right there)
$80Bn and counting
If you add up those few retailers, understanding that there are more than 400 retailers who now offer mobile commerce sales in the United States alone, you already have close to $100Bn in total mobile purchases/revenue, and Starbucks alone exceeds $1Bn in
mobile payments revenue.
However, the more interesting trend is that of those that offer mobile purchases, you regularly see 30-50% of the payments already coming via mobile. While not every retailer offers mobile as an option, and thus we don't see 30% across the board, the fact is
all you need to do is offer mobile and you'll see adoption of somewhere between 10% and 50% on today's figures.
By 2015 on the estimates provided, here are a list of companies for whom mobile will make up more than a third of their revenue:
- iTunes (App store only, not Apple entirely)
- Urban Outfitters
- BestBuy, etc
It doesn't take much to do this research and come up with these numbers. The facts are clear, mobile is defintiely mainstream for those retailers and service providers who offer mobile purchases. For those who don't - it probably isn't mainstream yet...