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Walmart pursues mcommerce leadership by tapping MasterPass

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January 5, 2016

MasterPass is racing ahead with a bevy of major retail partnerships

MasterPass is racing ahead with a bevy of major retail partnerships

Walmart is angling for the top spot in mobile commerce, as evidenced by its move to integrate MasterPass into its digital offerings following the December rollout of the retailer’s own mobile payment platform.

The retailer is tapping MasterCard’s digital payment solution following a fruitful year for mobile commerce, which saw mobile and online purchases skyrocket. As it gears up to maximize sales with the launch of Walmart Pay, the brand is ensuring its digital checkout experiences are rife with options for tech-savvy consumers.

“Adding MasterPass is smart move,” said Jon Squire, CEO and founder of CardFree, San Francisco. “Any time you can take some pain out of the sign-up process, the customer is happy and Walmart should benefit from higher registration/adoption.

“We’ve now seen all of the big brands begin to embrace a common rail-in – to both reload payment vehicles and ease in the checkout process – and we expect 2016 to be race between all of the ‘Pays’ to maintain relevancy in these merchant wallets. With consumers, it’s often the first mover that gets the adoption so we’ve been seeing players get more aggressive in pursuing merchant deals.”

Retail-friendly features
MasterPass’s partnerships with a slew of major brands and quick service restaurants suggest that the digital payment platform has a lot to offer the retail world, particularly when it comes to driving mobile sales conversions.

Walmart’s newest initiative for 2016 will see the retailer incorporate MasterPass across its mobile and online properties in a bid to enhance the checkout process with even more digital payment options. MasterPass requires users to sign up for the service once by inputting all payment details and shipping information, which it then securely stores for future transactions.

Later, when shoppers view the “Buy with MasterPass” button on a mobile site or embedded within a retailer’s application, they may select it to enjoy a one-click checkout.

The solution is designed to save time for consumers by eliminating the need to enter billing and delivery details for each purchase, a process than can be especially frustrating on a small-screen device.

Consequently, marketers seeking to bolster their current digital payment choices are finding services such as MasterPass to be valuable sales channels.

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MasterPass is helping Walmart broaden its suite of payment options

Individuals interested in signing up to use MasterPass may do so by going to masterpass.com, or visiting a participating bank. The solution is currently accepted by 250,000 merchants around the world.

Walmart’s move to integrate MasterPass into its digital offerings highlights the retailer’s desire to cement its status as a leader in mobile, much like what Starbucks is doing. Walmart is staying ahead of the curve by rolling out its own payment solution, but is also ensuring that no potential customer is left behind, thanks to platform-agnostic options such as Walmart Pay and MasterPass.

The nation’s largest retailer launched the Walmart Pay mobile wallet this past December to meet customers’ demands and address the lack of open solutions usable across devices and payment types (see story).

Walmart Pay was created to better the mobile checkout process as well as the in-store experience, a tactic which differentiates it from MCX’s CurrentC wallet.

It is conceivable that the brand’s decisions could have a spillover effect on the rest of the retail sector as well.

“Walmart, like Starbucks and Dunkin’ Donuts, has a very unique relationship with its customer,” Mr. Squire said. “Walmart has the key ingredients to drive mobile success, frequency and loyalty, and it’s hard to imagine it won’t come out a winner in the space.

“Many in the industry are watching it closely and will likely follow its lead.”

Potential missteps
While offering a plethora of payment options is paramount for any major retailer, so as to not alienate iOS or Android users with an inclination for one particular service, Walmart must also be careful to refrain from overwhelming customers with a barrage of choices.

“Adding MasterPass to [Walmart’s online and mobile offerings] will increase the opportunity to sell, but I’m not sure that the impact will be significant, at least in the short-term,” said Thad Peterson, senior analyst at Aite Group, Atlanta. “In order to use the MasterPass buy button, a customer needs to register for the service and while it’s card agnostic, the clear perception from customers will probably be that it’s for their MasterCard and not necessarily for another network.

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Walmart Pay in action

“Walmart already has PayPal and that covers a lot of customers that might otherwise use MasterPass.  It gets to the whole buy button issue. How many and which kind should a merchant use?”

One solution to combat this potential mishap may necessitate engaging in heavy advertising for the MasterPass integration, alerting customers that not being a MasterCard holder does not preclude you from using the solution when buying items via mobile or desktop.

Walmart is likely well-poised to start of 2016 on a strong note in terms of mobile commerce, but a lukewarm reception from long-term shoppers could have the ability to shine a less-than-positive light on too many payments partnerships.

“A lot of choices means a lot of confusion for customers, which can mean a lot of abandoned shopping carts,” Mr. Peterson said.

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Alex Samuely is editorial assistant on Mobile Commerce Daily, New York. Reach her at alex@mobilemarketer.com.

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