Western mobile payment options such as PayPal and Apple Pay are scrambling to reach the levels of consumer engagement that Chinese mobile counterpoints Alipay and WeChat have achieved, according to a new report from Forrester.
In the report, titled, “Engage Customers With Mobile Wallet Marketing: What Global Players Can Learn From Asia’s Digital Leaders,” researchers at the firms said Chinese mobile wallet companies have secured loyalty through efforts that inform the entire customer life cycle.
Alipay and WeChat have benefited from consumers who are ready for mobile pay options that enhance their shopping journey and facilitate frictionless checkout options. “A whopping 76 percent of metro Chinese consumers use mobile wallets or are interested in doing so, compared with just 36 percent of the urban online U.S. population,” the report said. It noted that Chinese consumers are primed for the release of new technologies due to their familiarity and participation within the digital ecosystems of Alibaba and Tencent.
The Asian e-commerce and messaging platforms connected available services while addressing friction points found during check-out. “Both Alibaba and Tencent have been expanding their coverage in the digital ecosystem, including group buying, online travel agencies, and ride hailing and food delivery services,” said authors of the report. “Naturally, their mobile wallets have become the key connector of the various mobile services in the ecosystem and have evolved into lifestyle platforms.”
What Western counterparts can glean from these success stories is perhaps more than simple technology know-how. By reconciling challenges consumers faced in point-of-sale moments, loyalty and trust grew. Alipay and Tencent are also remaining future-focused on new technologies — instead of being caught in the weeds of overwhelming data that might serve little direction unless accurately analyzed and utilized in new marketing mechanisms.
“In addition to regular coupons and display ads, both wallets successfully invented new formats, like Alipay’s augmented reality [AR] red packets. During Singles’ Day last year, Alipay launched the Pokémon-Go-like AR mobile game Catch the Tmall Cat,” the researchers said. “More than 30,000 retail stores participated, including KFC, Shanghai Disneyland and Starbucks; Starbucks alone gave away 270,000 AR coupons.”
They also look to new shopping behaviors to dictate features that embrace emerging consumer patterns. For example, Alipay optimized cross-border spending by sending push banners for tourist hot spots once users entered a different country. What’s more, they also go beyond the basic services of payment to other intuitive functions such as food and car ride ordering, the report said.
Perhaps most importantly for Alipay and WeChat’s success stories is their holistic perspective on purchases dictating a relationship with consumers that begins before a purchase and ends long after the item is bought. WeChat has integrated messaging features into its mobile while Alipay delivery status functionality serves an added value, the report suggested.
By approaching each user as a human rather than a data point, the mobile pay options have expanded their reach to offer users social gifting features — Starbucks pioneered the technology. “By leveraging the power and reach of WeChat, we want to encourage everyday simple acts of kindness to put a smile on someone’s face at any time or place, while elevating the unique Starbucks experience beyond our retail stores in China,” said Belinda Wong, chief executive officer of Starbucks China, in the report.
And though U.S. counterparts are still playing catch-up to Alipay and WeChat’s advancements, they are working on improvements. The report said PayPal has already rolled out features that help users find nearby stores and Gmail for Android allows customers to send money directly through its app.
There’s also room for third-party providers. The report suggests building a strategic and localized approach for consumers to adopt mobile wallets while also proactively testing new features that will best resonate with users. Maximize on shoppers’ rising tendency to use mobile wallets for cross-border travel and shopping excursions, the report suggested. As Millennials and Generation Z shoppers mature and gain spending power, deploying efficient, accurate and speedy features that keep step with new behaviors will be integral to immerse in daily usage and dependency.
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