Could consumers’ fears about crooks intercepting their financial data and spying on their locations dampen adoption of mobile payments?
Not necessarily, say experts.
But banks and retail marketers have a long way to go before consumers are comfortable sharing the level of personal data needed for robust mobile-commerce applications, suggest the results of a recent survey from consulting firm KPMG LLP.
KPMG conducted its online survey of 9,600 consumers ages 16 to 65 in 31 countries, including the U.S., late this past summer. (Consumers in Saudi Arabia and Nigeria were surveyed by telephone.)
Close to half of the respondents, or 40%, were worried about crooks intercepting their credit card data when performing financial transactions using mobile devices. Forty-one percent of respondents were nervous about the threat of unauthorized parties accessing their personal information through mobile devices, and 40% were concerned that advertisers eventually might choke their cell phones with spam.
The results suggest “a high level of consumer concern” about privacy and security when using mobile devices, Paul Wissmann, KPMG national sector leader for media and telecommunications, said in a Dec. 8 press release.
But consumers will let their hair down if they get a good deal or the mobile-device shopping experience is sexy enough, the survey data suggest.
Thirty-five percent of younger respondents ages 16 to 34 said they would share their mobile-device usage patterns and personal information with advertisers to get a discount on a product or a service, compared with 21% of adults ages 35 and older who said they would do so, the survey data show.
The survey findings support other market research indicating consumers “want to get something in return” for sharing personal and financial information through mobile phones, Bryon Morrison, president of the wireless practice at Dallas-based The Marketing Arm, tells PaymentsSource.
“Consumers will be willing, and even eager, to share personal and financial information with retailers and banks through mobile devices if they feel they are getting a better experience–if you give them a banking or shopping program that’s more exciting or delivers genuinely better value,” Morrison says.
To make that happen, financial institutions and retailers should ensure that new applications in development for mobile commerce are dazzling, he says.
“New mobile programs need to reduce the steps involved in transactions, speed up transactions or enrich existing loyalty programs, discount or product-comparison features,” Morrison says.
Firms developing mobile-payment technology also should play close attention to consumer concerns about protecting privacy and security, and let consumers feel they are in control, Morrison says. “But most consumers won’t even know how mobile payments, combined with a two-way exchange of information, will change their lives until they experience it,” he says.
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