ApplePay is Like Listening to Barry White with the Lights Down Low. It’s Quite an Experience

This is my first inaugural blog here at Javelin and I will be talking about the intersection of experience design and payments. “The payment experience”—it is, if you think about it, distinctively human. Bartering, trading, transacting—all arrangements establishing a platform for a payment experience. Whether intentional or not, we have been designing this experience since, well, forever.

Although John Biggins can be credited (pun) for designing the first credit card, or “Charg-It” card in 1946, Frank McNamara, the inventor of the Diners Club Card, was the first to realize and challenge the then current (1949) payment experience.

Physically, he just created a piece of cardboard that was accepted at restaurants as an alternative to cash. But what he actually designed was a new, meaningful experience. What most people don’t realize is that all design is the process of evoking meaning. Quoting my DMBA Department Chair, “…meaning is the deepest connection that you can make with your audience, user, or consumer. It is established between people, between people and objects, between people and places, etc. And it is meaning that is the deepest part of those invisible connections.” 

Meaning is why by 1951 there were over 200,000 Diners Club Cards in circulation. The experience invoked both freedom and security. Although the platform was stable from a security perspective, the comfort of knowing that they had an acceptable, convenient alternative if they forgot their wallet or didn’t want to carry so much cash on them was such a credible (another glorious, unintentional pun) and meaningful experience to cardholders and is why the card (and the brand) has dominated the payments industry.

Who has challenged the payment experience today? (Of course) Apple Pay.As a note, I’m not going to talk about adoption rates, you can view them here Simply put, it is fairly obvious that our infrastructure has to catch up to this product. I will be talking about why the product will be successful with those who are using it and how the experience of the product will affect users and non-users alike.

Apple crafted a product that establishes a deep connection with its users. By marrying security and convenience, they have created a truly meaningful experience. The user authorization, the secure element, and the tokenization process all combined, offer users a deep sense of personal security. From an engineering perspective, it is secure, very, very secure. However, it is not just software engineering that helps create this sense of security—it is empathy.

Let’s look at our existing, in-store, payment experience. You shop, you swipe, you pay. You shop, you tap, you pay. Whether mag stripe, EMV, or NFC, this system has become fairly robotic in nature. Yet, it is still very intimate—that two-by-something piece of plastic represents our earnings, what we work every day for, how we provide for our families, and in a way, what represents our sense of personal, social, and financial security. So as robotic as the payment experience has become, it is still, very intimate. We saw this with the reactions to the Target and Home Depot security breaches—people felt violated and vulnerable and those feelings didn’t go away quickly. These were the sensitivities Apple designed for—and why users have responded so positively to the product.

Onto usability. People have and always will respond to convenience. It is not convenient to be asked 6 questions after you have just spend two hours trying to weed your way through kid-filled carts and arguing couples at 11:00AM on a busy Sunday at Whole Foods or Safeway—especially on a small screen, with a small font, on a dark background.

“Does the pen not work?”

Just trying pushing it with your finger.

“NO, no, I don’t want cash back.”

It’s ok, just press zero.

“Crap, I hit no.”

Oh, you canceled it, go ahead and swipe your card again, you have to start over.


That is a horrible experience.

One touch. Processed. BOOM BAM. Yes, many other companies have used NFC technology (Paypal,Google) but the back-end was never as integrated and the front-end was never as convenient. This is what creates such a powerful experience for the user. The sense of security is the foundation, the seamless checkout is the convenience; the marriage of the two is the experience. And it is the design of this experience that will (if it hasn’t already) distinctively affect future expectations for payments.

The Inevitable ApplePay Blog

So, the payments unicorn has finally made its way out into the world, with more conjecture and hyperbole than, well, the last time Apple did something. Much has been written thus far about ApplePay and it’s going to be hard to write anything truly fresh at this point, but I will try.

While the mainstream media was ooing and aaahing over Apple’s innovative new product, us fintech geeks were generally a little underwhelmed by certain aspects. In truth, I was very impressed by the integration of biometrics and tokenization – absolutely leading edge in terms of where security should be (is a fingerprint a PIN, Mr. Durbin?), but the rest of the ApplePay news was a bit flabby and old. NFC? That’s been rattling around since 2003. Building a merchant ecosystem? Not really – just piggybacking on Google Wallet, Softcard and those nasty looking old terminals at McDonalds that have been gathering McGrime since 2006.

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Apple Pay Starts Today October 20, 2014 –So Why Should You Care?

 Why should you care about the Apple Pay launch?

Consumer Confidence in Mobile Purchasing is Growing

Apple iOS users are young: 60% are under age 45

Apple iOS users are wealthy: 7% have investable assets over $1 million

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Fraudsters Take Advantage as Mobile Convenience Outweighs Security for SMBs

The allure of both smartphones and tablets stems from convenience, pure and simple.  For SMBs, that convenience translates into greater productivity when using mobile devices to manage their business and their finances.  The situation is complicated by the effect that convenience has on the security posture of employees, especially those who are using their personal devices for business purposes (i.e., bring-your-own-device, or BYOD).  When convenience outweighs security, the scales tip to the detriment of SMBs.

What Javelin found in our most recent report is that when you combine mobile-accommodating businesses (who are chasing every productivity edge they can muster) with the intent of fraudsters (who take advantage of every security weakness they can find) that things become unpleasant in a hurry.  Besides having to manage the challenges of company-issued devices, there is also the evolving BYOD movement to contend with.  Without clear guidance on their roles and responsibilities around BYOD and confronted with mobile-specific threats that are overwhelming the security habits of their employees, mobile-accommodating SMBs experience significantly higher rates of payments fraud than average.  And size does not necessarily translate into mobile-security savvy, as middle-market businesses ($10M to $500M in revenue) are no better off than micro businesses ($100K to under $1M in revenue) and small businesses ($1M to under $10M in revenue).

This is where an SMB’s financial service provider comes in.  The mobile security posture of SMBs directly relates to the integrity of their accounts; educating these clients should be a priority because as the use of mobile grows, so does the risk of fraud.  In the SMB Payments Fraud Report, we discuss how to empower SMBs in the fight against fraud – providing them with an opportunity to protect their revenue, which in turn can bolster the relationship with their financial service provider.  We need to restore the balance between convenience and security, but we won’t succeed if we are blind as to how the scales are tipping and why.

10 Keys to Apple Pay: The Quick and Dirty Analysis

Apple Pay 2

Overall Analysis: Apple Pay is the most important mobile payment system to be released to date.

1)      Customers of Apple iOS are the most likely to buy with their phones (67% purchase using their phones), they spend 2X as often as a typical smartphone owner and they purchase higher dollar amounts with their phones ($25 vs. $20 median purchase). Apple iOS control almost half the existing consumer smartphone market (45% vs. 47% for Android) in the U.S. This bodes well for Apple Pay and provides an incentive for merchants to adopt Apple Pay. Read the rest of this entry »

Yes, I really did just accept an a position on the Consumer Advisory Board of the CFPB! (Consumer Financial Protection Bureau)

I just accepted a position on the Consumer Advisory Board of the CFPB. This will require several trips a year to Washington, DC along with several touch-points, and I’m looking forward to getting acquainted with the CFPB’s staff and other 24 Consumer Advisory Board (CAB) members. I have a lot to learn!

I can’t get enough of innovation and digital strategy. My 30 year career started in merchant e-commerce technology, with numerous product management/leadership/launch roles before moving over to product-innovation research some fifteen years ago. The CFPB was formed after the global financial services meltdown  Read the rest of this entry »