But these articles miss a key point: Apple Pay is based on Passbook, and Passbook has amazing abilities, that most haven't seen yet, to cut costs for retailers.
- Passbook is much more than a "coupons and offers" wallet
- It's much more than a payment system
Passbook is a fundamental improvement in the way retailers get new customers in the door. (See our write-up here to get a glimpse of mobile wallets in neighborhood shopping.)
Why Merchants Care
Retailers and big brands are having a difficult time with mobile. The majority of shoppers won't download retail mobile apps. Think about it for a moment: if less than 10% of shoppers will download retail mobile app, how are retailers supposed to reach their audience? Can we truly have "mobile-enabled shopping"? No.
This is where Passbook cards come in handy. They are a simpler, more lightweight form of "mini-app", a snap to distribute because they don't take up memory on the phone and take only a few seconds to download.
- Mobile apps are difficult to give away. Passbook cards are easy.
- Mobile apps aren't good for new customer acquisition. Passbook cards are great.
Passbook is Apple's Secret Weapon
Passbook is Apple's secret weapon. Imagine a market where each and every single retail brand or retail store has it's "brand card" for Passbook, a combination of loyalty points, offers, sales, brand education, and map/phone number for the store. Shoppers grab whichever cards they want.
Passbook allows every merchant to do what Starbucks did with their mobile payments system...build on top of mobile payments, adding offers and marketing, building brand value.
A Concrete Example
Consider Walgreens as an example:
- Walgreens currently has a mobile apps in Android and iOS. A small percentage of Walgreen shoppers will download and use these apps.
- However the other 60% of shoppers, especially those who are new or unconvinced, will not download these mobile apps.
- How does Walgreens reach these new customers?
- Walgreens could mass-distributed Passbook cards via Facebook, web pages, text messages, or in-store posters.. to customers who don't yet have a native app.
- Many of those customers who refused to download the native app WILL download Passbook cards.
- With our dynamic server technology, Passbook cards can build a relationship for months. Customers almost never delete them.
- No programming required, a few hours to set up.
The result: significant ROI, reaching more customers with little investment.