Staples has revealed that Apple Pay is now the most popular form of payment in its iOS app, used for 30% of purchases made using the app. Apple Pay also appears to have driven new sales, with almost two-thirds of those transactions being from first-time Stapes customers, reveals FierceMobileIT.
“Apple Pay has been one of the most successful implementations when it comes to payments. […] Right now it’s the number one payment method for us in our iOS apps,” said Prat Vemana, vice president of mobile commerce for Staples.
Vemana also revealed that while Staples has both iOS and Android apps, with usage split pretty evenly between the two, Apple owners are more profitable, generating 70% of mobile purchases …
Staples didn’t reveal stats for in-store use of Apple Pay, noting that it hasn’t yet made it to the top three payment methods there but that numbers are “healthy.” Staples began accepting Apple Pay in its 1,200 stores last November.
While Apple Pay has been enjoying considerable success in the U.S., now accounting for two-thirds of contactless payments through more than 60 banks and other financial institutions, a planned roll-out in China has reportedly been stalled by delays in reaching the necessary agreements and regulatory requirements.
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I have two questions:
1. Does the vendor pay Apple a % for this? If so, what?
2. Does the customer (IE, anyone using Apple Pay) pay anything extra too?
No to both. The credit card companies pay a very small percentage to Apple. Neither the vendor nor the customer bear any additional cost.
Cool, thanks.
The idea behind it being that the credit card companies which charge fairly high fees to merchants, will end up ahead by passing along a vary small portion of these fees to Apple while at the same time Apple Pay cuts down on fraudulent charge losses.
Apple could have probably gone to the merchants and created a system (if Apple Pay is as secure it seems) which forgoes the credit card processors and their high fees. However, user adoption probably would have not been as fast without the credit card analogy (“users love their credit cards” Apple says). Plus by keeping the middle men around, Apple is getting a lot of free promotion from VISA, Chase, AMEX and the banks.
Finally, it seems like the merchants weren’t happy enough with just eliminating processing fees but also wanted direct access to your bank account and easy to access personal shopping information–something Apple Pay actually hides. So they were already in the process of developing an often maligned competitor payment platform, at one time called ISIS and now called CurrentC which we may have read about.
Thanks, very interesting!
This is really interesting when you factor in that the Staples online store is second only to Amazon in terms of net sales in dollars.