The market in US for digital wallets has been growing considerably. Many payment options like Apple pay, Citi Wallet, Android are in use and upcoming product announcements from Samsung, Chase, Visa and MasterCard sounds promising. But if we consider the consumer side, only 2% of the payments are through mobile wallet. Even services like Paypal, Venmo are struggling to gain progress. So will consumers adapt digital wallets at a faster rate? A Mckinsey Research suggests that mobile payments will reach upto 9% spending by 2020. Among these, the early leaders would be online transactions combined with mobile payments. This could be followed by POS.
Online transactions are mostly done by card data stored in file, browser etc. Hence digital wallets should offer some sort of value to particularly capture this market segment. Also a considerable amount of effort is required from merchant side in terms of acceptance. Merchants should incentivise consumers to enable some motivation to help them make the switch. Starbucks is a good example as it helped consumers make the switch with reward programs.
Among consumers, if we look at a need based segmentation, Mobile enthusiasts would be early adopters. They could be followed by people who like to shop for deals, manage finances on their own. People who are cautious about security and budget would be late adopters. Hence trying to maximise market adoption would require specific strategies to attract different segments. Apple pay and android pay would be more attractive to mobile enthusiasts. To appeal to other segments, the product should have additional propositions other than just payments like helping to manage finances, reward programs by merchant companies, integrating bank card with digital wallet etc.
Source: http://www.mckinsey.com/~/media/McKinsey/Industries/Financial%20Services/Our%20Insights/Digital%20wallets%20in%20the%20US%20Minding%20the%20consumer%20adoption%20curve/Digital%20wallets%20in%20the%20US.ashx