Dive Brief:
- Kroger is piloting Google Pay, Apple Pay and other mobile payment programs at 61 stores under its QFC banner in and around Seattle, according to a company press release. Kroger has not indicated a timeline for the pilot or if it will roll out to more banners across the U.S.
- Kroger, which last year launched its own mobile payment program, will also allow QFC customers to utilize Samsung Pay, Fitbit Pay and banking apps. Shoppers can also use contactless chip cards.
- Contactless payments are enabled through near-field communication (NFC) technology, which uses a radio frequency field to transmit data between a mobile device and a checkout PIN pad.
Dive Insight:
Kroger has been promoting its Kroger Pay program during the pandemic, and likely hoped that would suffice for customers rather than bringing on the third-party payment systems it has resisted up until now. Walmart has taken a similar approach with Walmart Pay, which launched back in 2015.
But the pandemic has boosted consumer use of contactless payment options, and Kroger wants to make sure it's reaching as many of these customers as it can.
Retailers like Target, Albertsons, Whole Foods and Costco have started accepting mobile payment programs in recent years as adoption as increased. According to eMarketer, there were more than 30 million Apple Pay users in the U.S. as of October 2019, making up nearly half of all mobile payment users in the country. Google Pay made up 19% of mobile payment users, while Samsung Pay made up 17%, per eMarketer.
According to a January survey by payment solutions provider Blackhawk Network, three out of five U.S. consumers have a mobile wallet.
For Kroger, the QFC pilot adds to a few other contactless payment services the company is currently touting, including curbside pickup and its Scan, Bag, Go mobile checkout service, which has introduced new improvements recently, according to the company's latest press release.
Launched last February, Kroger Pay is now available to shoppers chainwide. The program links up with shoppers' loyalty cards and offers customers a single-use QR code to scan at checkout for a faster transaction.
Despite growing interest in contactless payment during the coronavirus outbreak, mobile payment options aren't seeing a major uptick in usage, according to an April report from PYMNTS.com. Walmart Pay, for example, was only used in 3.3% of eligible transactions in the period from early- to mid-March, a decline from 4.5% in 2019. Apple Pay usage peaked in 2017 and has been declining since, according to the report.
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