By : Andy Brown
September 26, 2017 08:00 AM
For many people, their relationship with their financial services provider is a long-lasting and complex one, often built up over many years. While a consumer may well move between brands in sectors such as retail fairly frequently, when it comes to their finances, trust is a hugely important factor.
Perhaps, then, it is unsurprising that consumers have a tendency to stick to names that are familiar to them when it comes to activities such as mobile payments. In a market where there are a wide range of names competing for attention - both established brands and newer startups - being able to stand out from this crowd and gain the trust of consumers will be a difficult task.
PayPal, Amazon top mobile payment brands
This has been highlighted by a recent Harris Poll study, which has announced the results of its 28th annual EquiTrend study. This measures the overall health of brands in various categories, with the study looking at Familiarity, Quality and Purchase Consideration to give each company a brand equity rating.
In the mobile payments category, it was PayPal that topped the table to win Harris' Brand of the Year designation for the third consecutive year. Online retail giant Amazon took second and third places with its (now discontinued) Checkout by Amazon and the replacement Amazon Payments offerings respectively, while PayPal-owned Venmo was fourth.
Joan Sinopoli, vice-president of brand solutions at The Harris Poll, noted: "Financial services is a very difficult category for consumers to relate to, so it's no surprise that mobile pay and credit cards, which consumers use every day and see real, tangible benefits with, are the shining categories."
A place for up-and-comers?
This does not mean, however, that there's no room for providers with less of a foothold in the mobile space to make inroads into what is a market with huge potential. Sinopoli said that consumers' appetite for these services is increasing, and as new services build their familiarity, there is every chance that they could become significant threats to more established brands.
Already, relatively new startups such as Venmo and Square have proven to be successful in this market, while options from companies not previously thought of as financial services providers, including Amazon and Apple, have also increased their brand equity score significantly over the last 12 months.
Sinopoli said that as these names continue to gain recognition, "rooted brands like PayPal and Amazon Payments must continue to differentiate and leverage their master brands so they don't find themselves surpassed by fast risers in the category."
Opening among younger consumers
Targeting a young, tech-savvy customer base is likely to be a particularly effective strategy for emerging brands looking to establish a foothold in the market. These consumers may not have the same long-term attachments to their financial services providers that their older peers do, and are typically seen as more willing to give a new provider a chance.
Millennial customers already have much greater awareness of mobile payments options (42 percent are familiar with such brands, compared with just 19 percent of baby boomers). Harris Poll also noted that in general, younger consumers have positive opinions on the quality of these services, with the likes of Square and Apple Pay challenging more established brands on this factor.
This can only be positive news, and if these strong perceptions of mobile payments providers are maintained in the coming years, there will be huge opportunities for the most innovative and forward-thinking providers to make their mark in the sector.