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Mobile pay competition intensifies, as Kohl’s Pay instantly triumphsBy
It has only been a few weeks since Kohl’s debuted its mobile payments platform, Kohl’s Pay, but uptake has been so strong among customers that the department store has already released some preliminary numbers.
The results of the first month of Kohl’s Pay bode extremely well for the retailer, with widespread proliferation of the Kohl’s Pay platform occurring around the country. The success of Kohl’s Pay could provide brands within similar retail strata a playbook for how to implement a mobile payments infrastructure.
“With their existing in-store app and the ability to support alternative payment types such as Apple Pay and Visa Checkout, Kohl’s has a solid foundation upon which to layer on their own mobile wallet,” said Ryan Grogman, vice president at BRP. “Their continued enhancements to the customer experience through the use of technology is one of the reasons they have been able to maintain relevance and accelerate adoption of Kohl’s Pay among the newest generation of shoppers.”
Kohl’s Pay is just the latest native mobile payments platform that retailers are pushing through in lieu of cards. The service is available through the Kohl’s application, and works as both an added amenity to existing Kohl’s app users and a practical entryway into the app for Kohl’s shoppers who have not yet downloaded it.
The platform works similarly to more generalized mobile payments platforms such as Samsung Pay, Android Pay, and Apple Pay, the latter of which already has a presence in Kohl’s locations. A significant difference, however, is Kohl’s Pay’s requirement that the user sign up for a Kohl’s Charge card instead of attaching their own credit or debit cards.
The mobile payments service works as a mobile analog to the Kohl’s Charge card, meaning that the learning curve to the technology is low for existing Kohl’s customers. It also allows for the user to automatically redeem offers, Kohl’s Cash and rewards through the app.
The results have been more than copacetic. In just a few weeks, Kohl’s Pay enrollment has grown by more than 70 percent week over week, Kohl’s Pay user transactions have doubled and 40 percent of Kohl’s Pay users are sending offers from their mobile wallets.
In addition, Kohl’s Pay has been leveraged in all 49 states Kohl’s operates in, and Kohl’s has had at least one Kohl’s Pay transaction in two-thirds of its stores.
The uptake will bode will for the holiday season
“Only the largest retailers with enough critical mass can feasibly build out an app with payments capabilities that truly adds enough value to the customer experience to be worth the investment,” Mr. Grogman said. “Several large scale retailers are opting to introduce their own branded mobile payment services because of the added benefits of having payments connected with their loyalty program and the associated customer information it captures.
“One of the easiest ways to identify customers is in the payment space. In exchange for valuable data, merchants can give shoppers a more personal and frictionless payment experience.”
The widespread uptake of Kohl’s Pay is good news for the company ahead of the holiday season. The Kohl’s app can provide a central hub for the brand to attract customers through offers and mobile browsing, which is a necessity for Kohl’s and its department store ilk that are currently struggling with stunted growth and store closings.
Kohl’s Pay comes at a time where the spread of mobile wallet platforms is hitting critical mass among large retailers. CVS Health joined the slew of marketers rolling out their own mobile payments services with the introduction of CVS Pay, an in-application feature that enables customers to pay for items, pick up prescriptions and collect loyalty points using a single bar code (see story).
And the volume of transactions on Walmart Pay recently increased 45 percent week-over-week, following the completion of the mobile payments solution’s rollout to all of the chain’s stores in the United States (see story).
“The use of Kohl’s Pay and Kohl’s other mobile apps are great ways to engage with its customers and help attract young, tech-savvy customers,” Mr Grogman said. “With the quick uptake of mobile capabilities, Kohl’s is on a roll and it paves the way for them to introduce continued enhance mobile feature and further customer engagement.”
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