Target Offers Glimpse into the Future of Digital Payments

More retailers, like Target, are looking to roll out mobile payment apps. How will they integrate them with the current shopping experience, and will consumers take to the concept of different apps for different retailers?

While it may be tempting to look at the upcoming Target Pay (true product name TBD) as just another mobile payment app, there are some aspects to the upcoming solution that may shine light on what’s ahead. 

For starters, Target is rolling this out with a niche consumer segment — its own RED cardholders, many of whom are also users of its famed Cartwheel shopping app (downloaded more than 27 million times). Because this segment is already used to pulling out their phones at checkout, Target Pay would not require much of a change in behavior.

Second, Target’s switch to EMV chip technology has led to  transaction times longer than magnetic stripe swipes, an irritant to some of their most loyal shoppers. If a mobile payment app can speed up that process, it may be enough to sway even a non-RED cardholder to look deeper into becoming one. 

A question on a lot of minds is whether or not retailer apps like this and Walmart Pay will cannibalize growth for Apple Pay, Android Pay and Samsung Pay. It may. On the other hand, faster, more seamless mobile payment experiences at major retailers with their own wallets may entice consumers to duplicate that experience at other places (places where only mainstream “Pays” are accepted).  

It’s hard to imagine a day when we all have 100 different apps for 100 different retailers on our devices. Yet, as those apps evolve into tools that truly add value in terms of discounts, coupons, rewards points and more (Starbucks, anyone?), perhaps it’s not such a wild vision. As apps become easier to use, faster to download and ask pretty much nothing of us as they run in the background (siphoning our personal info to feed the big data machine), we may not  think anything of using 100+ apps.