As 2015 draws to a close and we move to 2016, the key thing to keep an eye on is the role convenience plays in new business initiatives. As services such as Google Express, Prime Now and Postmates indicate, consumers look for immediate gratification while expending minimum effort.
As Wal-Mart announced today, they applied to the Federal Aviation Administration (FAA) for permission to test drones for numerous purposes, including home delivery. Clearly, they intend to compete with Amazon on delivering goods almost instantly. Wal-Mart may be even better positioned than Amazon, as over 70% of the United States population lives within 5 miles of a Wal-Mart. This major corporate effort is only one example of the convenience technology boom.
Chase recently announced ChasePay their competitor to ApplePay which they expect to release to consumers in mid-2016. Similar to ApplePay, this would allow consumers to pay for items with their phones, no longer carrying around credit and debit cards. However, this technology would work on all smartphones, not just the iPhone. But, one thing to keep an eye on with this new service is the way the technology differs from Apple’s. While Apple’s software is NFC based, allowing for tap and pay, Chase’s service uses QR codes. On the one hand, this software increases convenience as this system can be used at any store, not exclusively one with tap and pay enabled. Nevertheless, this system involves users opening their phone and the app and allowing the cashier to scan the code, rather than simply lifting the phone to a tap and pay system. It will be up to consumers to determine whether this different software optimizes their convenience, or does not.
Moving forward, the story-line to keep an eye on is how consumer demands for convenience determines the revenue and profits of major corporations, both those firms who are traditionally technology based and those who are not.