Can Apple Watch Become the Primary Platform to Rescue Apple Pay from Its Adoption Woes?

In the last year, three technology giants Apple, Samsung, and Google have all launched their own mobile payment solutions. All of these solutions work similarly, allowing customers to hold their devices up to the payment terminals in the stores instead of swiping a card. Contactless payments were predicted to spread like an epidemic as they are easy to use, they're secure, and they work really well.

However, despite high market adoption expectations, Apple's Apple Pay doesn't seem to be used much among Apple devices owners. Sorry, Tim Cook, 2015 hasn’t exactly been the year of Apple Pay.

A study conducted by anti-fraud startup Trustev on 1000 US-based owners of modern iPhones (models 6 or 6+) indicated that 79% of iPhone 6 or 6+ users have never used Apple Pay at all and 21% of users have tried the service once or more.

Trustev broke down the usage patterns for the 21% that used Apple Pay. Among the people who have tried it out, 56% report that they only use it once during the week, and 15.3% say they "never" use it during the week.

The numbers are even lower for Samsung Pay and Android Pay as reported by Trustev. Only 14% of people who have the Samsung Galaxy S5 and S6 have ever used Samsung Pay or Android Pay. Of those people who have, only 36.17% use it once in the week and 38.3% report they "never" use it. One of the reasons for low Samsung Pay adoption rates may be its very recent launch and the fact that mobile payments are still relatively new.

However, Samsung is being optimistic on the future of the service adoption. In their official press release published a couple days ago, Thomas Ko, global co-general manager of Samsung Pay said: "After one month, the numbers say it all: Consumers who have used Samsung Pay are using it repeatedly because it works almost anywhere you can swipe or tap a card. We’re thrilled to introduce new partners that will build on our early success, and move us even closer to a world in which your mobile phone is a true mobile wallet." Samsung also shared that the company is expanding the partnership ecosystem for Samsung Pay, announcing support in the coming months for cards issued by Chase, PNC Bank, TD Bank, SunTrust, Fifth Third Bank, Key Bank, Silicon Valley Bank, Security Service Federal Credit Union, Navy Federal Credit Union, Virginia Credit Union, Associated Bank, Randolph Brooks Federal Credit Union and People’s United Bank. Starting next year, Samsung Pay will work with Discover.

Returning to Apple Pay, Pat Phelan, the CEO of Trustev, shared his insights on the reasons for the slow Apple Pay adoption in Apple Pay survey results published earlier in 2015, saying: Apple Pay is a great system: secure, elegant and convenient. But the slow adoption shows how difficult it is to get consumers to change well-entrenched habits, like paying with card swipes. Of course, it is early days, more merchants are coming on board, and I’m sure we’ll see adoption grow, but the initial reception has been slow.

He also added in the Trustev report: It also points to a broader issue: maybe paying with cards is just not that painful. For years, techies have been pitching e-wallets to consumers, but they don’t seem interested. Even after Apple has launched by far the most elegant version to date, consumer adoption is light.

Rurik Bradbury, the CMO of Trustev, agrees with Pat. Rurik commented for the Tech Insider: "It just seems to me that there's not much of a problem Apple Pay fixes. Paying with a credit card is very easy. It's a habit everyone has."

More than 82% of survey respondents according to Trustev survey reported that paying with a credit card in a store is "very easy" or "easy", validating Pat’s and Rurik's comments.

Among the other reasons for low Apple Pay adoption, the survey conducted by Trustev earlier this year, listed the following:

  • 50% of early and average adopters said they didn’t care about the feature,
  • 34% of late adopters didn’t know about the feature,
  • Most groups didn’t care about merchant acceptance - only 19% of ultra-early adopters said that’s why they didn’t use Apple Pay.

Apple Pay adoption rates has been a popular topic among researchers. Marianne Berry, Managing Director of Auriemma Consulting Group (ACG) Payment Insights practice shared her insights regarding the survey by ACG on the company's official website. ACG reported, that despite the enthusiasm of early adopters, Apple Pay sales volume accounts for only a tiny share of overall credit and debit card sales, and Berry doesn’t expect that to change quickly. Berry commented, In the early days after launch, we found a high level of intent to use among those who hadn’t tried it yet. As more iPhone owners gain the ability to use the service through the upgrade cycle, we’re seeing a pretty stable proportion of about 30% who are taking a ‘wait-and-see’ attitude, often citing security concerns about a new technology.

Even though 2015 has not been the year of Apple Pay according to the adoption rate data reviewed above, positive trends were observed in relation to Apple Watch. Wristly Apple Watch Insider’s Report indicated optimistic results on Apple Pay adoption among Apple Watch owners. Wristly conducted a survey between 11th and 18th of August, 2015 with more than 1,000 participants from the UK and US. Interestingly, 80% of Apple Watch owners surveyed are already using Apple Pay (compared to the adoption rate mentioned previously in this article being between 15% to 20%).

Another important insight from the Wristly survey is the fact that while the vast majority used Apple Pay first with their iPhone (56%), slightly more than 19% of respondents (or 25% of those who have used Apple Pay) first tried it on their Watch.

Wristly further analyzed the 19% of Watch users in the US who haven’t yet used Apple Pay and found that about 5% of that subset indicate that they do not perceive a benefit, another 5% have concerns about the security of it and about 15% state that their payment needs are being met already. What that means is that 25% of the non-users may never be interested in using Apple Pay at all.

Given that those 25% of surveyed that may never use Apple Pay are within 19% of the whole set, the end result will be around 5%. Therefore, Wristly concludes an optimistic result of only 5% of Apple Watch users being unlikely to use Apple Pay.

What does it actually mean in terms of adoption? Lets look at it from the other perspective. These results mean that Apple Pay on the Watch could eventually reach an adoption rate as high as 95%, suggests Wristly.

However, the positive trends do not end here. Survey results suggest that one of the main reasons not to use Apple Pay is the fact that it is not supported by the banks and the uncertainty in store acceptance.

These results can be seen as a positive trend because they indicate that the adoption rate has potential and usage barriers are not related to Apple Pay itself as it provides a smooth experience, but are due to the external factors, which can be fixed over time.

The idea is approved by the 81% of those surveyed reporting that they use Apple Pay most of the time when it is available.

When asked about the feeling regarding their Apple Pay usage, 51% of those surveyed said It's magical and 42% reported convenience.

Another interesting insight is the fact that 79% of those surveyed would prefer to use the service on their Watch vs. 9% who would prefer to use it on the phone.

Positive trends in Apple Pay adoption and usage are also indicated by the frequency of use amongst those surveyed who used the service. Earlier in June, another Wristly survey reported 65% of the panel members who had set up Apple Pay were using it on a weekly basis. The survey conducted by Wristly in August indicated a total of 78% using it at least once in the prior week and 14% claiming a daily (or more) usage rate. That’s more than 15% increase and illustrates an incredibly fast pace of usage and adoption.


Although 2015 did not fulfill expectations of Apple, the corporation, there are lessons to learn and certainly space to improve. Apple Pay may not be the problem fixer when it comes to the smartphones. However, Apple Watch has great potential as a device to push Apple Pay adoption along. Apple Watch owners clearly indicated desire and interest in using the service if the retailers and banks accept it. For Apple it implies the need for active partnership development and extra efforts to boost adoption of Apple Pay on Apple Watch. Low Apple Pay adoption on iPhones has interestingly brought Apple to the revelation of another opportunity: promoting Apple Watch as the primary channel for Apple Pay...or perhaps that was Tim Cook’s plan all along!?