Mobile Wallets: An Emerging Marketing Platform

Due to the rapid pace of digitization, 64% of the 195 million smartphone users today are employing mobile wallets that boast convenience and ease of usage – where they can simply scan and go with the use of technologies such as NFC.

However, as more consumers face the issues of reward programs and negative in-store experiences, the potential of these wallets in fact, do not just lie in payments, but more of a marketing platform for businesses to borrow mobile moments and offer value-added services to better serve their customers.

An example would be China, who is one of the worldโ€™s leading players in the mobile wallets sector, that has taken aggressive steps and evolved into adding phenomenon features such as loyalty perks, giving tips, making donations, sharing bills, and redeeming coupons which have since became powerful customer engagement tools.

So, to illustrate the above, here we will look at two innovative strategies that AliPay and Wechat Pay, the key players in the country have implemented to facilitate their consumers’ mobile wallet experiences.

AliPay – AR Coupons & Red Packets

Apart from the regular coupon banner ads, AliPay drew inspiration from the popular Pokemon-GO, and released an augmented reality (AR) mobile game where users of the app can walk around to search for and collect coupons that are hidden by retailers, or red packets (hongbaos) hidden by family and friends.

How does it work:

Retailers and AliPay users hide virtual coupons/hongbaos in their desired locations by scanning them with their smartphone cameras. They upload the photos in the app where locations are automatically recorded, and then send clues to consumers/friends to find the red packets. Once found, users can simply scan the spot and tap on their screen where the coupon/hongbao appears and the money will be deposited into their AliPay account.

How does it help with consumer engagement:

By tapping on the offline tradition of giving red packets during festive occasions such as Lunar New Year as a token of good luck , the game becomes a form of online entertainment for consumers. And, it forges a community amongst users of the app where they are encouraged to engage with one another by sending clues or asking questions while playing the game. With this digital activity, it also drives online traffic due to the strong desiring culture of receiving promotions and offers, so when users share a post or tag their friends after finding the coupons/hongbaos, it helps to increase awareness and user participation of the app.

The result:

After the feature was released in 2016, it witnessed positive results where a total of more than 30,000 retail stores participated – such as KFC and Shanghai Disneyland who alone gave away 270,000 AR coupons. More than 100 million AliPay users also won red packets that amounted to 800 million yuan during a promotion that occurred during a Lunar New Year gala program.

Wechat Pay – Starbucks Social Gifting Feature

‘Say it with Starbucks’, a collaboration between WeChat Pay and Starbucks where users of the mobile wallet can send beverages or a digital gift card with personalised messages to their friends and family via the app on occasions such as Valentines’ Day.

How does it work:

Given that WeChat Pay is integrated in the WeChat app, users can simply click on the Starbucks icon that appears on the Wallet page, and proceed to choose a preferred gift certificate or a cup of coffee, add a personal message using text, images or video, before paying directly via the wallet and sending it to a friend. Upon receiving it, the friend visits a local Starbucks outlet and flashes the QR code coupon to redeem the gift.

How does it help with consumer engagement:

Through social gifting, it becomes an initiative to enhance consumer experience by celebrating special festivals and holidays, as well as the special moments in customers’ lives. The feature also encourages consumers’ participation for they are able to display acts of love, concern and gratitude through instantaneous and convenient ways of sending digital gifts to family and friends. Overall, it is actually a predominant way of cultivating new and authentic customer relationships.

The result:

Since the release of the feature, WeChat Pay now accounts for 29% of all Starbucks transactions and over 1.2 million gifts were sent amongst consumers while half of the number have been made for redemption in Starbucks outlets.

The Takeaway:

To conclude, given that the use of mobile wallets as a marketing channel has thus far been proven a success in the Asian market, this trend would hence most likely catch up among foreign merchants in the near future.

And while users of these wallets are also expected to grow, it is still ideal for brands to work on identifying the strengths and weaknesses of their existing apps and justify on adding better sophisticated features to provide a more holistic form of engagement experience, and eventually building on consumer awareness, loyalty and retention in the long run.

So, what are your thoughts? Do you think more businesses should utilise mobile wallet marketing? Please feel free to share your comments below! ๐Ÿ™‚

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6 thoughts on “Mobile Wallets: An Emerging Marketing Platform

  1. Hi Emily! it’s me again! Answering to your question is YES, I think that more companies should take up mobile wallet marketing and learn the footsteps from China! I also really like the fact that you have wrote on consumer driven tactics done by Alipay and WechatPay! Mobile wallet is a Good example on mobile marketing as i am sure we are all able to relate!
    Looking forward to your upcoming post!

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    1. Hi Huiru! Thanks so much for your input! Indeed, China is a global leader in the mobile payment industry for a reason, hence I also hope that more countries can learn a thing or two from them ๐Ÿ™‚ Although I also think that it may take some time for brands to fully revolutionise the use of mobile wallets as a marketing channel, given that there is still a portion of consumers who do not trust the system due to security issues. So letโ€™s hope that things would turn for the better in years to come ๐Ÿ™‚

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  2. Hi Emily, insightful post you have! I also do feel that more businesses should utilize mobile wallet marketing. Nowadays, we can leave the house without our wallet but definitely not our phones. Our credit cards and loyalty cards could all be stored in this compact portable device and as the world is moving towards the idea of cashless, mobile wallet may be the future. I like the example of AliPay you’ve given, games and free credits could undoubtedly induce people to use their service. I mean, even I myself would!

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  3. Hi Wenqi! Thank you for your input! ๐Ÿ™‚ Personally, I’m enjoying the convenience of just paying with my mobile device as the thought of carrying cash and coins kind of puts me off sometimes due to the mess! Also, China is indeed far ahead of everyone when it comes to technological innovation. Who would have thought that angpows can be given via a game or the scanning of QR codes? Definitely adds on a bit of entertainment purpose for the festive occasion! ๐Ÿ™‚

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  4. Hi Emily, there are many benefits with using mobile app payment! As you can see in SIM, they are encouraging students to pay using the app โ€œpaylah!โ€. It is fast and cashless! One of the main reason China is using this is because there are many people using fake money!

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  5. Hi Abby! Yes you’re right! I actually really like the fact that cashless methods are popping up almost everywhere in Singapore right now. It brings so much convenience especially when there’s a long queue at ATM machines. Oh my, that’s bad to hear! ๐Ÿ˜ฆ But at least they’re really pushing forward their use of advanced technology to make things better!

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