Apple Music may be doing fantastically in terms of subscribers, but Apple isn’t having quite the same adoption success with Apple Pay, according to a new report.
Payment industry and retail data analysts at InfoScout and PYMNTS claim that the percentage of iPhone 6 users in the U.S. who have tried Apple Pay declined from 15 percent in March to 13.1 percent in June.
The number of “committed” users is falling, too. Back in March, the number of committed Apple Pay U.S. users was reportedly hovering around 48 percent, referring to the ones who would use Apple Pay in a store that accepted the payment technology. In June, that number had shrunk to 23 percent.
So what is to blame? PYMNTS CEO Karen Webster seems to take the view that Apple Pay is a solution in search of a problem.
“Paying for something at a counter in a store isn’t broken – Apple Pay was ‘fixing’ a pain point that doesn’t exist for consumers,” Webster said.
Elsewhere, Webster argues that:
“When Apple Pay launched, it did so with constraints on the user side – had to have the iPhone 6 – and the merchant side – had to have an NFC terminal – and nothing more than a way to pay as a consumer value proposition. When even the diehard early adopters didn’t go crazy for it at the start, it seemed a sure sign that their slog to ignition would only get harder. That’s certainly how it appears.”
Personally, I don’t think Apple has anything to worry about. Among everyone I’ve spoken with anecdotally about Apple Pay, no-one has reported a less-than-great experience with the service.
If usage rates decline over a longer period, Apple may have something to worry about, but it makes perfect sense that early adopters are more likely to jump on technologies like Apple Pay more quickly due to their love of tech. People buying the iPhone 6 now that it’s a year old are less likely to fall into this category, which also makes them less likely to seek out new technology like NFC payments.
It may take a while for everyone to cotton on to the technology but, when they do, I can’t see people going back.
Somehow I don’t see Tim Cook losing too much sleep over this one.
Source: PYMNTS
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
54 responses to “Apple Pay adoption is on the decline in the U.S.”
The slow ramp-up in banks that participate – and vendors who accept Apple Pay – is a large part of the issue I’d assume. I have yet to use it because it took 10 months for my bank to be approved and I only know of a couple places in my area where I can use it. Not exactly a recipe for success.
What a contrast to the U.K! Since launch, I’ve only used my card a couple of times, been Apple Paying the whole time.
You must be the dick in front of me trying to buy a coffee yesterday, holding up the whole queue with repeated failed attempts to pay, fiddling around with your damn phone and bobbing up and down because you still had your earphones in.
They opened another till in the end and processed about four other payments before you were done, everyone else just tapping their contactless card.
Maybe you didn’t notice the pitying glances and wry smiles of the pretty girls behind the counter.
Maybe you didn’t spot the withering looks from your fellow customers, or hear their tutting and frustrated words.
You sure looked mighty cool though, eh?
Wow.
You obviously feel annoyed about the experience you had yesterday. Perhaps rather than hiding behind your keyboard and abusing a stranger who had absolutely nothing to do with what happened, you should have encouraged the guy having issues yesterday to pay with his card.
Personally, I’ve used ApplePay with no glitches so far. I’ve been mainly using it on my breaks when I’m already using my phone anyway. It’s convenient and easy.
If there had been an issue if have just paid with my card, not held the line up.
The point is it is solving a problem that doesn’t exist, and creating a whole host of potential new ones in the process, not just to the inconvenience of the user, but also to innocent retail staff and fellow customers.
I’m glad you keep your card handy and are aware of the fact that you may be inconveniencing others. But other people don’t. Which is not very cool, is it?
How is it any more of a problem than someone who’s card has got damaged, so won’t swipe or the chip won’t read?
It’s really not a complicated process. Please go look like an idiot somewhere else. Thanks.
Funny. That’s precisely what I thought.
I’d use it every day if there were enough stores offering it. I’m pretty sure you’re right.
Im in the UK. I want to use apple pay sooooo bad. I am with Barclays, however, who are one of the only major banks in the UK which doesn’t support apple pay. I am giving barclays till december 31st this year to adopt Apple Pay, else i will be emptying my account and switching. Finito.
I use it where I know it works, but often am unsure so default to my credit card. I don’t like standing there waiving my phone around. Most standing at the check-out have no clue still about all of this either. I’m aware of the service and try my best to use it but imagine how the casual user feels.. if this is at all confusing or uncertain, they will go back to credit cards only.
My experience exactly! My banks are Apple Pay friendly- it is the merchants who are slow in adopting Apple Pay.
If someone can hack the firmware of a Mac without a person knowing it happened who to say that the firmware of the ApplePay isn’t going to be a likely target of hackers in the very near future. Can Apple, banks and other financial institutions have an iron clad agreement that if someone does hack the firmware that the people’s accounts will be reimbursed the full amount that the hackers steal. This sort of thing is in it’s teething stages and I would rate till it’s more mature before getting into it.
Apple never gets your credit card/account number… It creates tokens.
But banks and other financial institutions do. Still won’t trust it. Hell I hate carrying credit cards since they can be scanned while in you pocket.
My theory on this and almost anything that is written in code is that if a human can write another human can hack it.
You need to read up on cryptography. It’s not hard to make things like this very very secure.
We have a credit card get hacked every year. Not too much of a big deal if you pay attention to your statement. Usually the credit card company calls us first wondering why someone is using our card on the other side of the country at a gas station just minutes after we used it in our neighborhood. Have yet to lose any money.
That doesn’t happen with Apple Pay.
Dude, the banks are the last and final stop. Of course they have to have your personal info. If they are going to be hacked, then it doesn’t matter what form of payment you’re using (besides cold hard cash). Think about it.
Using Apple Pay eliminates just another link in that chain of potential hacker attack. The bank will always be the end of the line and will always be where our personal info has to reside, but with AP at least it can be the only place left, rather than scattering our details across so many various merchants.
Funny how people have this wild theory about card being scanned in your pocket!
Have you had yours scanned once or someone close to you?
Stop being scared or worried over nothing
> Hell I hate carrying credit cards since they can be scanned while in you pocket.
Silly urban legend.
First, the data is encrypted with on a random number generator, that is, the raw data read out is different every time, so it is scientifically impossible to prank the card simply with a transponder.
Second, the technology used in credit card can not be “scanned”. The signal is very “fragile” and you’ll need to place the card at the right position and angle so that the signal can only be read. And only one card can be read at the same time so only garbages will be read out if you’ve multiple card in your wallet.
Third, a reader that is capable to read though your bag is at the size of a large trunk and weight about 40+ lbs, and you’ll also need an antenna the same size of a pizza.
What you believed is nothing but witchcraft. Read more science textbooks and don’t spread rumors like that anymore.
I am an android user but i hope that apple pay succeeds. I love using my gwallet to pay at places and with apple pay there have been even more places because of it. I guess if apple pay fails then nfc payments will decrease also which sucks.
I use mine all the time too. I have actually been seeing more people use it lately.
“…cotton on…” Lol, proof-read or get a job you can do effectively.
http://dictionary.cambridge.org/dictionary/british/cotton-on
Also, proofread is one word.
Nobody uses that silly term in the US, or was your piece written only for UK folks? Also, i do not profess to be a professional writer, as you do.
It’s an American idiom as well, just an infrequently used one.
Wish I could help. I have a card stored in my iPhone, but I haven’t had a chance to use it. I just don’t see any Apple Pay logos when I shop. I could probably use it at my local gas station, but getting out of my car at a full service station seems less convenient to me.
I attempt Apple Pay if I see the wireless insignia on the card machine, most times it works regardless if there is an Apple logo present or not. Wonder if not many people try this which ultimately lends to less usage?
Hmmm, I need try that. I’ve seen the wireless insignia a few times, but if it didn’t say AP, I assumed it wasn’t going to work. I especially prefer using AP on my watch.
Same here on the watch. Yeah the BP Gas Station I frequent says nothing about AP but has the insignia. On the off-chance that it would work I tried it and wha-la. Same goes for my grocery store, tried it the other day and it worked.
Apples own website tells you that if you see the contactless logo, it will work.
I definitely enjoy using Apple Pay on my watch, especially at the grocery store, where I spend most of my retail money. I wish AP were set up at drive-throughs and gas stations. I would bet that there’s still many iPhone users who don’t know how and where to use AP.
Jack in the Box in california has it set up in their drive thrus
Really? I go to JB about once a week. Do the workers have to use a handheld scanner to make it work?
I’ve been to 3 or 4 different ones and they all have a scanner mounted on the drive thru window.
McDonald’s has a handheld.
Yeah, I know, but I try to avoid McDonald’s as much as possible. Lol
I carry 3 CCs. I just pull out the one that gives me the most cash back for the situation (gas pump, or grocery store, restaurant, etc). I’ll bet I can open my wallet and switch to my desired CC faster than doing it on an iPhone. I agree with the author – Apple is trying to fix something that’s not broken.
And my CCs never run out of battery.
iPhone yes, but the apple watch is faster.
The purpose of course isn’t to be faster, but the fact that apple pay is the most advanced payment technology in the world (tied with bitcoin in complexity, and a step ahead of EMV used in europe). Apple Pay is about protecting your data (it’s the equivalent of digital cash, which is why retailers are hesitant since they have become addicted to downloading everyones data and losing it). It only has to be as fast and convenient.
The whole speed argument is absurd. There’s no difference in time between digging out your wallet and selecting your card, to getting your phone out and double tapping the home button.
My issue is that it isn’t supported everywhere and you always have to ask or try and fail… and the clerk has never even heard of it if you do ask first. Around here, there are many places that have readers with NFC symbol but they still don’t take NFC payments and/or are not configured.
It needs to be (nearly) as universal as the credit card itself. I would use it 100% of the time if it can get more market penetration.
The problem is certainly NOT the (dumb) argument put forth here about “solution in search of a problem” security benefits alone are worth it for me, my CC has been reissued three flipping times thanks to security breaches within the last year.
Apple can keep on pushing but will only succeed if Apple also supplies the underlying infrastructure to all retailers especially the major ones, which is not going to happen.
Moreso, ,most retailers wants to capture the retail data which is big resource, which they wont get with the adoption of ApplePay which is solely controlled by Apple
False, in Oct new laws will push data loss liability onto the retailers unless they upgrade their systems to those that support EMV and which will therefore support NFC and apple pay.
It isn’t a solution in search of a problem, and apparently Karen Webster doesn’t understand what the real problem is. I now avoid retailers who don’t accept Apple Pay because here in the US capturing mag stripe data from payment cards is both relatively trivial and relatively lucrative if you’re a criminal looking for a payday. This is the problem Apple Pay solves and is the reason why I won’t shop at stores who don’t accept it.
I would love to make use of it more often (and start leaving my cards at home), but my “daily driver” credit card isn’t supported yet and most of the merchants I frequent don’t have NFC terminals =(
This just proves how stupid average people are. Having to carry around that damn wallet when our smartphones could replace it for payments is a dream people just don’t realize they would love. Apple Pay IS fixing a problem that exists – having to carry both items (if adoption was high enough all stores would start accepting it and you could leave your fucking wallet in the car), and the fact that stores are getting hacked and all that personal information is getting stolen. Guess what, if you only ever used Apple Pay, those stores wouldn’t have any of your personal info!
-sigh-
Perhaps Apple is simply failing to make the case, not advertising the benefits well enough. I so long for a time when my smartphone can be the only thing I need to carry with me.
The case can only be made if Apple is willing to supply the underlying infrastructure and share retail data with most retailers.
Most retailers don’t want to provide the infrastructure while Apple rips the benefit of it all.
Lets be honest, lack of Apple Pay will not deter you from shopping from a retailer close to your home simply because they do not support it, i can bet that you aren’t willing to drive 2-3 miles just to find a retailer with Apple Pay, there is a similar store a a few yards away from your home.
Also keep it in mind, that there are a lot of people out there with Android, unless Apple can really provide this product to Android users, it will struggle to gain traction.
Apple don’t need to do anything for Android, they have Googke Wallet. Both use the same systems on the retail side.
As for retailers, I’m assuming you’re in the US, in which case soon those retailers will have to move to the worldwide standard of chip and pin cards, meaning all the terminals will have to be replaced anyway.
Thanks for proving to everyone how stupid you are.
Your ignorance and imbecility is quite obvious, considering the fact that you cannot comment respectfully……..
Ignoramus
Says the one who doesn’t realize Android phones can use the same NFC terminals Apple phones can use.
Unless you are an early adopter, the novelty wears off after awhile and becomes inconsistent coupled with the fact that some retailers in US do not support it yet, not to forget that most of us are conditioned to whip out our CC for most purchases before remembering we have Apple Pay.
Apart from Fraud issues, the time differential between using apple pay and using your CC is not much and with the advent of chip and pin technology in a few months, the fraud argument for use of Apple pay will decrease.
Apple has to supply the underlying infrastructure for retailers and also be open to sharing retail data for this to really catch on and consider working with Android on this. there is still a high number of people out there with Android and they aren’t going to switch to IOS just because of Apple Pay
Apple pay drives NFC payment drives android pay drives merchant support. This will obviously be how payment is done in 10 years, we are just watching it grow.
Of the first 100 users, 100% of them used Apple Pay because they were early adopters. Once the unexposed masses got their hands on it, 100/100000000 of them used apple pay.
This will change in october