Mobile payments success hinges on customer care

Consumers will be using their handsets to make mobile payments valued at $180 billion (€145 billion) in 2017; an astonishing number given the relative immaturity of the complex technology and value chain that is involved.

However, this forecast comes from Juniper Research, a respected market intelligence firm, claiming that more than one in four of U.S. and Western European mobile phone users will pay for goods in-store using their NFC-enabled handset by 2017, compared with less than 2 per cent this year.

The company stresses that NFC-based m-payment trials are now increasingly transitioning to full commercial service as both mobile operators and the financial services industry push forward with their deployment plans.

Gartner takes a more aggressive stance, claiming that m-payment transactions, not just those using NFC, will be used by over 200 million people this year and exceed $171.5 billion in value.

However, Gartner's view is that text messaging will remain the dominant technology for these m-payment transactions in developing countries, while Web/WAP will continue to be the preferred technology in Western Europe and North America. NFC, meanwhile, will continue to play a minor role in the m-payment sector until 2016, according to Gartner.

Regardless of the technology, the amounts--both people and transaction value--involved cause me to wonder about the level of customer care that will be necessary to preserve user loyalty.

Juniper Research does recognise this worry and highlights that m-payment services must be deployed with a fully integrated and tested customer care channel. It points to the complex mix of mobile, financial and retail technology needed to ensure the process works efficiently. The firm also advises that a single point of contact be established to take responsibility for resolving customer problems, warning that users will quickly turn away from m-payments if issues are difficult to resolve.

Rating a service on its response to customer problems can provide stark illumination as to its interest in subscriber retention. A few excel, leaving the previously annoyed customer happy to continue being a customer and willing to recommend the service to others.

The majority, however, are average or poor, and a few seem to pride themselves on insurmountable incompetence.

Having battled with my telecoms provider for several weeks, where the problems still remain more tangled than when the first issue arose, I fear for the future of m-payments if telecoms providers such as these are part of the mix of industry players.--Paul

P.S. Customer service of a different, but no less important, kind is essential to the future success of M2M. For more on this burgeoning sector, check out this new special report.