Published On: Wed, Feb 24th, 2016

How Did Mobile Commerce Get So Big?

Will mobile phones eventually negate the need for a wallet? That question has been on the lips of experts for some time now. Many believe that soon enough we will do away with all portable payment options except the mobile phone.

Mobile business

Well, it hasn’t quite worked out like that yet. And if you ask me, mobile phones will never replace payment cards on such a grand scale. Think about it: have cards obliterated cash? No! Most of us still carry cash around. We continue to pay for things using traditional credit cards and cash, and we’ll be doing so for a very long time. It wouldn’t only require a huge change in people’s spending habits. It would also require a change of the infrastructure of too many businesses. There are still businesses out there that don’t even take card yet. Some that do still charge exorbitant fees to payers who want to use card.

So maybe this revolution is a long way off yet. But online payments have caused massive changes. Why do so many people think it’s coming at all? Well, a look at the mobile commerce industry will show that it has grown at a truly astonishing rate. Think about it: just over a decade ago, mobile commerce was barely even in people’s dreams. Now it’s touted as the next trillion-dollar industry.

But how did all of this happen? Here’s what companies did to expand mobile commerce.

It’s incredibly easy

The most attractive feature of mobile commerce is that it’s really easy. It takes no time at all to enter card details into an app once. When those details are saved, a user never has to enter them again. With so many websites able to accept credit card payments via mobile phones, it’s no wonder this payment method has spread in popularity.

Payment options in free products

There are so many free apps available for you. There’s the tremendously popular messenger app WhatsApp, or the game Candy Crush. Most of the popular apps are free. But they all come with features you can pay for.

By tempting users with additional features in bigger and free applications, the app market is making billions. Surely not, I hear you say. Why would people throw money at something they can use for free? I direct your attention to the daily revenue King make through Candy Crush. Nearly a million dollars a day, and that’s just one game. King make several other games. And King is just one company; there are several other companies making billions in the same way!

So even in the free items on your phone, companies are making big bucks. That is, in fact, where the big bucks are.

Moving to replace the credit card

Apple Pay. Android Pay. Samsung Pay. Those are the biggest mobile payment platforms around right now. Notice a pattern in the names, there? Physical stores all over the world are getting set up to accept these payments, negating the need to use cards or cash.

What else do you notice? They have the names of the biggest mobile phone companies around. These payment apps are being used not only to spread the use of mobile payment. They’re used to support the even larger, ‘micro’ platform behind each one.

And it’s not like those are the only payment apps around! There are an amazing amount of payment apps that cater to very specific situations. For example, there are a ton of apps made for splitting the bill with friends. It sends money from several people to one user, who then pays the restaurant with the press of a button.