Madison Reed has raised $32.1 million since launching 15 months ago.
A new study suggests the technology will not take off anytime soon.
41% of consumers are completely disinterested in using a mobile wallet for m-commerce and another 17% are not very interested, a new survey from digital marketing firm Catapult Marketing finds.
15% of consumers are very interested in mobile wallets, 10% somewhat interested and 17% neutral, the survey says. Catapult Marketing surveyed nearly 250 U.S. adult consumers in its Catapult Shopper Lab.
What’s more, 67% of consumers would be very concerned about maintaining their privacy when using a mobile wallet, the survey finds. 24% would be somewhat concerned, 7% are neutral and only 2% would not be concerned at all. Further, 47% would be very concerned when loading a mobile wallet onto a smartphone about an increased possibility of mobile phone theft, the survey says. 26% would be somewhat concerned, 13% are neutral, 7% would not be very concerned and another 7% would not be concerned at all.
These sentiments don’t bode well for companies, including Google Inc. and eBay Inc.’s PayPal, that have launched or are planning to launch mobile wallets. On top of the other sentiments, consumers have little trust in companies that have or could potentially build mobile wallets. While 50% of survey respondents say they would trust a mobile wallet from PayPal, PayPal’s closest competitor in consumer trust is Google at only 18%. 15% would trust American Express, 13% Verizon, 10% AT&T, 9% Target Corp., 8% T-Mobile, 8% Apple Inc., and 7% Wal-Mart. 42% of consumers would not trust any of these companies.
To be successful, a company behind a mobile wallet must educate potential users about what kinds of benefits the technology would bring, such as convenience, heightened security, speed at checkout and delivery of coupons, Catapult Marketing says.
“Privacy and security concerns must be addressed upfront,” the company says. “And theft concerns are real and must be addressed, for example, by using double sign-on, or fingerprint, retina or voice activation. While there may be early adopters of mobile wallets, nothing broad-based is likely until some of these barriers are addressed.”