08/10/2015 8:16 AM IST | Updated 15/07/2016 8:25 AM IST

How Mobile Payments Can Transform Consumer Experience


Let me start with a personal confession. For the very first time in my life, I used Uber in June 2015. Why? Out of sheer necessity. Needless to say, after one experience as a user I've become their advocate and fan. All it took was 39 minutes of my time, from mobile app download to destination.

What was it that appealed to me so much in a 39-minute interaction?

Just two words: the experience.

So what was it about the Uber experience that I really liked? First, booking a cab was never so easy before. It was simple. It was quick. It was smooth. It was convenient as it was done from within the confines of my home. Booking done, it was "service" time. The cab was on time. It was well-maintained. The drive to the destination was smooth. In fact, the driver engaged in very interesting conversation all through the way. It was seamless. When I got off the cab, the driver never mentioned anything about the price because it was enabled through mobile payments. Last but not least, the fare was one of the lowest I'd ever paid for the route. So, basically, an exceptional service experience at an incredible price point. And at the end of it, I felt really happy, good and upbeat. Not to mention, that I've recommended Uber to everyone in my network. (If Uber is reading this, they should be happy.)

"So what does a mobile payment system really do for me as a consumer? What it does is create a paradigm for me to live new experiences."

At this point I'm reminded of a quote by existentialist Albert Camus: "You cannot create experience. You must undergo it."

The thing about experiences and how we as individuals live them is very personal, contextual and is significantly influenced by the culture and the social ecosystem we are a part of. The other thing about experiences is there are very many flavours of how we all live them. So there are purely physical experiences, emotional experiences, intellectual experiences, information experiences, cultural experiences, financial experiences, social experiences and ethereal experiences. All these flavours add up in their own way to the overall experience we have as individuals. The value and importance we associate with each of these experiences is again subjective, based on our personal preferences and circumstances, so there's no secret potion which does the trick for every one of us!

Specifically in the context of payments, the "experience paradigm" is multi-layered, as described below:

First is the shopping experience, which is about the process of shopping, i.e., deciding what you want to shop for, getting feedback from friends/family /social media, deciding at which store (online/offline) you will shop.

Next is the buyer experience, which entails covers the process of buying, i.e. short-listing exactly what you want to buy at a particular store (online/offline), thinking through priorities, preferences and possibilities, getting feedback to help you finalise what you will buy, putting it in a shopping cart and placing an order.

Then comes the payment experience, which is about the "process of payment", i.e., deciding which mode of payment you will use (cash, card, etc) and actually making the payment -- which really involves transfer of funds from the buyer to the seller.

Last is the overall experience which is really about how you feel at the end of it all; it's a function of how you live the experience from start to finish.

As a consumer, I'm quite satisfied making payments with a card or cash and they work fine most of the time. So what does a mobile payment system really do for me as a consumer? What it does is create a paradigm for me to live new experiences. The novelty of trying something for the first time that makes you go "wow". Which disrupts the way you live and experience life. Which changes the way you do everyday things. Which pushes you out of your comfort zone, and compels you to explore ways to do everyday things in a faster, simpler and more efficient manner.

That is the real beauty of mobile payments. Creating new experiences for everyone...

Let me illustrate the way mobile payments can create new experiences.

Payment experience

By the mobile phone being an alternate for carrying cash/card, and using it as the way to initiate a payment transaction. Some noteworthy examples are Apple Pay and Stratos Card . What makes a difference is whether you can use the same mobile payments app for in-store/online/mCommerce purchases or both across brands/merchants.

Buyer experience

By enabling you to scan through and select for a product or service through your mobile phone, and also pay for it from your mobile. The Starbucks mobile app is a good example.

Shopping experience

By providing an integrated marketplace where you can choose from brands, buy them and also pay on your mobile phone. Examples include the Alipay wallet app. In this scenario, the end consumer experience can significantly vary based on whether a user can use the same mobile payment app for in-store and online needs

Customer experience

By integrating the online and offline experiences to create a "wow" customer experience. No prizes for guessing that Uber is what I'll put here.

The differences between these experiences are subtle, but distinctive. And can make all the difference in the way a consumer experiences the mobile payments solution.

In the long run, I think what will truly make a difference for mobile payments innovators are two things. One, being clear on what "consumer experience" they aspire to transform or disrupt. Two, being clear on how they'll make money 5, 10 or 15 years from now.

As I sign off, I leave you with a question: When did you first / last use a mobile payment? What did you experience? Did you like it? Leave a comment to let me know

A version of this post appeared here

Disclaimer: The views expressed in this post are mine and my employer does not subscribe to the substance, veracity or truthfulness of my views.

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