While mobile payment systems (mobile money, mobile wallets) have been around for over a decade, the unveiling of Apple Pay late last year has some analysts projecting that as many as 2 billion of these kinds of mobile transactions will transpire by 2017.
Apple Pay allows users to make payments using various Apple products, including iPhones, iPads, and the Apple Watch, which will be released later this year. Recent reports on Apple Pay seem to suggest that consumers believe that technology is safer than swiping a credit card and more "user-friendly" than other mobile payment systems. From a security standpoint, at least for now, Apple Pay's methodology may provide better data security and increase consumer "buy-in." Further, there is no doubt that Apple Pay will have a lasting impact on mobile payment transactions.
Marketers hoping for an aggregation of data shouldn't get too excited just yet. Apple has a history of externally espousing its criticisms of data mining, in favor of protecting the privacy of its customers. And when it comes to Apple Pay, Apple senior management has been adamant about privacy. Senior Vice President Eddy Cue stated that Apple is not in the business of collecting data, so when consumers make a purchase, the company doesn't know what you bought, where you bought it, or how much you paid for it. CEO Tim Cook has repeatedly restated Apple's interest in selling products and not data harvesting. Apple claims that competitors Google and Facebook are out of alignment with their customers because of their reliance on an advertising-based business model.
Nonetheless, Apple began venturing into advertising and data collection, albeit reluctantly. In 2010, the company tried its hand at creating a mobile advertising service, iAd, which proved to be a dismal flop for a couple of reasons. For starters, there was the whopping $1 million price tag. Next, Apple stated that marketers could design the creative—but Apple would produce the ads, and choose which customers to market the ads to. Marketers were ultimately reluctant to invest in such a heavily restricted ecosystem.